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Berkeley's Public Housing Units May Be Bought by Billionaire (Analysis)

By Lynda Carson
Wednesday September 21, 2011 - 03:31:00 PM

In another step to privatize Berkeley's 75 occupied public housing town-homes, billionaire Stephen M. Ross, CEO and founder of The Related Companies, and 95% owner of the Miami Dolphins, is in talks with the Berkeley Housing Authority (BHA) to buy Berkeley's occupied public housing units, through one of his companies. 

The BHA has entered into an exclusive negotiating rights agreement with billionaire Ross and his company known as The Related Companies of California, LLC, after the BHA's joint finance and feasibility subcommittee recommended that his company should be chosen to buy Berkeley's 75 public housing units. As of September 8, currently 66 units of the 75 units of Berkeley's public housing are still occupied. 

According to Forbes as of March 2011, 69-70 year old Stephen M. Ross is worth around $3.4 billion, and has made his fortune in real estate, is married with 4 children, and has lost around $1.6 billion in net worth during the past few years because of the crumbling real estate market. Ross resides in luxury at 956 5th Ave., in New York City. 

As recent as September 8, Tia Ingram, Executive Director of the BHA, directed the members of the Berkeley Housing Authority Board to approve the recommendations to authorize the Executive Director to enter into an exclusive negotiating rights agreement (ENRA) with The Related Companies of California, LLC, for the transfer of Berkeley's 75 public housing units to the company owned by the billionaire, Stephen M. Ross. 

BHA's Ingram, wants the ENRA to last a period of 90 days, with the possibility of a 30 day extension, to negotiate the terms of the Disposition and Development Agreement to transfer the 75 public housing units, and to designate the BHA's joint Finance/Feasibility Subcommittee as the lead to work with BHA staff during the negotiations. 

If billionaire Ross and The Related Companies gets their hands on Berkeley's public housing units, the city of Berkeley may end up subsidizing the billionaire and his company out of the city's Housing Trust Fund in the effort to renovate and rehabilitate the public housing units, but the majority of funds needed to renovate the buildings will have to be raised by the Related company. 

When asked if the BHA has another developer interested in buying Berkeley's public housing units if the negotiations breakdown, BHA's Project Manager, Kathleen Sims said, "The BHA is in negotiation with The Related Companies of California, and until those negotiations are over I cannot say more about the next step the BHA will pursue with it's public housing units if the negotiations fail. I think that finding someone to renovate and maintain the public housing units as HUD has ordered, is a good thing for Berkeley." 

Berkeley has long been known as a bastion of liberal causes and the progressive movement, and it is obscene gesture to many in the community that Berkeley's public housing units may end up in the hands of a billionaire and his for-profit corporation, and that the billionaire and his company may be subsidized with funds from the city's Housing Trust Fund. 

Former Berkeley Rent Board Commissioner, Eleanor Walden said, "The BHA has now fallen into lockstep with people like Dick Cheney and Haliburton, if this contract is not transparent or competitive. I am appalled at the record of the BHA during the past few years which has contributed to the erosion of public housing." 

Though established during 1966, in recent years the BHA has spent numerous years listed as a Troubled agency. The BHA owns and manages 75 public housing units, administers around 1,939 subsidized housing Section 8 voucher contracts, and filed papers with the Department of Housing and Urban Development (HUD) on Dec. 29, 2009, to dispose of it's public housing units. The approval by HUD to dispose of and sell Berkeley's 75 public housing units occurred on Dec. 22, 2010. 

As recent as May 2, 2011, the BHA released a Request For Proposals (RFP), in an effort to find one or more so-called nonprofit housing developers, or for-profit developers willing to buy Berkeley's mostly occupied 75 - three and four bedroom townhouse units, located throughout the City of Berkeley, on 15 parcels. 

Lynda Carson may be reached at