State should intervene for Kukui residents

THE ISSUE The Kukui Gardens affordable rental housing complex is for sale and residents fear eviction.

LOW-INCOME residents of the Kukui Gardens affordable rental housing complex on the edge of downtown are concerned they might face eviction in five years. The complex is up for sale, and the only way to ensure that its apartments remain affordable might be through state legislative action. As rents soar along with housing prices, the state needs to increase affordable housing, not allow it to disappear.

Clarence T.C. Ching developed the complex in 1970 as affordable housing, which qualified it for tax exemption and 100 percent mortgage insurance under the Federal Housing Administration. His son, Wallace S.J. Ching, who sits on the Kukui Gardens board of directors, opposes the sale, but he appears to be in the minority.

The pressure to sell the complex is strong. Two-thirds of the proceeds would go to the Marianist Center, the Catholic order that operates Chaminade University and St. Louis School, and the other third would go to St. Francis Medical Center. Ten of the Kukui Gardens directors are from those two organizations.

The 17 potential buyers have been reduced to three, and the board issued a statement that it has "no intention of accepting an offer from a buyer who will kick out the current tenants and raze the complex," as many residents fear. The statement pointed out that the buyer must comply with U.S. Housing and Urban Development requirements that it offer rents to low- and moderate-income. About 2,500 people live in the 857 units.

However, those federal requirements end in 2011, when the 40-year loan agreement expires. "After 2011, we don't have any other mechanisms to control affordability," said Cheryl Fukunaga, project manager for HUD.

Earlier this month, the state House approved a bill that would provide for the state to buy the complex through the power of eminent domain. The measure, which is making its way through the Senate, would allow the state to partner with private developers who would agree that all the units "be retained in perpetuity" as affordable, under HUD standards.