A 21 percent rent increase mandated by the federal government was the subject of much debate Tuesday at a public hearing of the Senate Committee on Housing, Parks and Recreation.
The committee also received an update on the relocation of residents of the Donoe Housing Community.
The meeting, chaired by Sen. George E. Goodwin, heard testimony from Conrad Francois, director of the Virgin Islands Housing Authority, on the agency's policy on family choice of rental payment, switching rent method and financial hardship.
Francois first addressed the matter of rent increases. He said tenants have an option to choose annually between a flat rent or an income-based rent.
Sen. Judy Gomez asked who mandated this raise, inquiring whether it was VIHA acting on its own, or the federal government. Francois explained that it is mandated under the federal Quality Housing and Work Responsibility Act of 1998.
"And what if we don't implement the increases?" Gomez queried.
"Then we would lose our federal rent subsidies," Francois explained.
Gomez wanted to know how government workers who "at this time can't afford it" would be affected.
The increases only apply to those tenants who are already at prescribed ceiling rents, Francois said. He added that "anyone lower than that would not be affected."
"We are not raising the rent; we are raising the cap," he said.
Sen. Donald "Ducks" Cole wanted to know if this was true and how it worked. Francois explained that the purpose of a ceiling is to protect residents from paying excessive rent. Cole said he receives calls every day from disgruntled residents complaining about waiting "two years" to get a new sink. He said he couldn't imagine these same residents welcoming an increase in their rent.
In response to Cole's inquiry about whose rent will be raised, Francois said 171 families are at the new cap, resulting in about 9 percent of 2,000 units.
On another note, Sen. Adelbert "Bert "Bryan, not a committee member, inquired about the equity of having tenants in high income brackets still living in public housing and keeping those in the lower money brackets on the waiting list for the housing. He asked if there was a plan in place to rotate those who can afford it out of the cheaper housing and into a homeownership plan.
Using figures supplied by Francois, Cole and Bryan both pointed out a Kirwin Terrace family (data supplied without names), with a total adjusted gross income of $67,778, who, under the VIHA, pay $772 monthly for a three-bedroom apartment. Bryan said it is these families who should move out and make room for other, more needy, tenants. Francois said these matters were under investigation.
On the Donoe Housing Community resident relocation, Francois said the work is moving along on schedule, and there is a "mostly favorable response from the residents and from the landlords."
Donoe, which was condemned years ago, is deteriorating to the point that it would be cost-prohibitive to repair it, according to Francois. It has not weathered time, nor the storms, well.
New housing for the tenants is funded under Section 8 of the U.S. Department of Housing and Urban Development. VIHA has received funding to relocate families from Donoe to private-sector housing.
Francois expects that by May all interviews with tenants should be completed. Interviewers assess the tenants' financial status and assist them in finding private housing. By November, or sooner, the site should be demolished, Francois said.
Cole asked if local contractors would be hired for the work. Francois said that since it's being paid by federal funds, "outsiders can't be kept out." However, he noted that strict licensing laws apply.
Cole reminded Francois that 4 percent off the top of any monies paid contractors goes to the Internal Revenue Bureau in gross receipt taxes, noting that there is legislation in place for that.
The meeting was attended by committee members Goodwin, Gomez and Cole, and by Bryan. Sen. Alicia "Chucky" Hansen was absent and Sen. Norman Jn. Baptiste was excused.
