Wilmington to resume nonprofit failure projects

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The Wilmington Housing Partnership, a semi-public non-profit organization that takes over devastated properties and rebuilds them for sale in affordable housing, is running out of money because it has bought too many properties without adequate funding, an audit found from the city.

WHP's director, Steve Martin, will resign and Wilmington's real estate and housing department will resume its two ongoing construction projects, the city said in a statement Friday afternoon.

"The WHP has accumulated remarkable achievements in neighborhood stabilization for many years," Mayor Mike Purzycki said in a statement. "I want to make sure that the PCS continues to focus on rebuilding our neighborhoods."

The WHP is partly financed by public funds and partly by grants and private loans. Several city administrators sit on the organization's board of directors.

The city was made aware of the financial difficulties of the organization last spring when the newspaper The News Journal reported that the organization was running out of money to pay a contractor, thus putting his plans outstanding. Purzycki then asked the city auditor Terrence Williams to review the agency.

The Wilmington Housing Partnership Project is running out of money, says a contractor

The News Journal has been inquiring about the finances of the organization since last spring. Martin has repeatedly agreed to meet with a journalist and then ignored the attempts to meet.

The publication of the audit by the city comes after a News Journal reporter asked for it via a request for public archives this month and after weeks of investigations. with the city on its role in the projects of the organization.

The audit revealed that the organization had poor monitoring of its financial records and inadequate monitoring of its bank accounts. The audit revealed that the organization had not followed the use of the grants, used the financial support of the city badly and had not recorded the costs of the project.

The two ongoing WHP projects, four townhouses located north of Pine Street and Vandever Avenue and 14 homes located in the 900 block of Bennett Street, have not been completed. .

The director of real estate and housing, Robert Weir, will finish these projects and sell them as soon as possible, said the city. Weir will also decide what to do with the approximately 150 properties WHP has acquired in recent years as part of an effort to preserve neighborhoods, primarily in the Wilmington East Side.

The audit revealed that about 88 of these properties on which WHP held inventory in June 2017 had a combined value of $ 3.1 million and that no development plan was required. put in place.

WHP was expecting about $ 400,000 in grants from the JPMorgan Chase Foundation, but still had to cover the initial costs of construction. As WHP was unable to complete the project, it was unable to recover some of the costs through the sale of completed homes.

The city granted two loans to WHP last year, $ 500,000 from Urban Development Action Corp. and $ 275,000 in real estate and housing.

In January, WHP owed the city $ 185,000 in outstanding loans.

WHP Board Chair Rob Buccini, co-owner of the city's largest development company, Buccini / Pollin, said that there was not enough money to keep the staff of the organization.

Buccini "has not discharged any responsibility for the current financial situation of the WHP," the city said in a press release.

In an interview, he realized that the WHP needed help from the city "six to nine months ago".

He defended the many real estate purchases made by the organization in the eastern part.

"The most difficult thing in this case is the acquisition of the property, so I think we did the hardest," he said. "L & # 39; s expertise [from the city] will be useful for building them. "

Christina Jedra contributed to this story. Contact Jeanne Kuang at jkuang@delawareonline.com or at 302 324-2476. Follow her on Twitter @JeanneKuang.

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