As Rome continues to grapple with a housing shortage, the Northwest Georgia Housing Authority is forging forward to meet a segment of the need by becoming its own general contractor.
NWGHA Chair Lee Hight makes it very clear, though, that the authority has no intention of competing with private industry homebuilders. It prefers to stay in a niche of providing quality affordable housing to low-income Rome residents.
“It gives us more control over what’s going on,” said Modernization Director Howard Gibson. “We can move a lot faster on some of our projects.”
Randy Lippert, one of the authority’s employees, is a licensed general contractor. The authority is able to use his position to take the lead on projects that do not involve state or federal housing tax credits.
The authority can serve as a co-developer of tax-credit housing. Once it has completed five such developments, the Georgia Department of Community Affairs can certify it to act as a lead general contractor.
NWGHA Executive Director Sandra Hudson said being a co-developer on tax-credit projects — like the Sandra D. Hudson Villas under construction off Spring Creek and East 14th streets in East Rome — also brings in developers fees.
The agency is receiving developers fees for the projects it is co-contracting on. Those fees are considered non-federal dollars, which the authority can use for a variety of purposes.
Hudson is clearly looking forward to the day that the authority can be the GC for its own tax-credit projects, but that comes with additional responsibility.
“We’ll have to put up all the guarantees — the construction guarantees and the guarantee that it is going to be completed in a timely manner,” Hudson said. Those guarantees are critical to getting capital investors aboard.
Gibson explained that one of the primary advantages of being its own contractor is that the authority is able to choose who it wants to use as subcontractors.
“Joe Wright Village is a good example,” Gibson said. “We permitted that and we can control what’s happening a lot better.”
Aside from control, there are some obvious financial advantages to serving as its own general contractor. To start with, the authority can purchase materials in bulk without having to pay sales tax because it is a tax-exempt agency.
The authority is also able to eliminate the overhead, the profit margin, that another contractor would include in any bid for work. Right now, the going rate is around 14%.
“We save all of that right off the top,” Gibson said.
In addition to the Joe Wright Village, the authority served as its own general contractor for the 10-unit Bill Collins Village homes on Charlton Street in the Summerville Park community. It has also taken the lead on infill housing along the Maple Street corridor in East Rome.
“We’ve also got a lot of small projects that we deal with, like remodeling or insurance claims,” Gibson said.
The housing authority has 1,166 names on its waiting list for public housing.
However, Hudson said the U.S. Department of Housing and Urban Development has adopted the position that it is not going to allocate any additional public housing units to Rome.
Some of the homes being constructed along the Maple Street corridor are considered public housing, but those are replacement homes and not considered "additional" public housing units.
Again, that creates non-federal revenue, which the authority is pretty much free to use to continue to build new housing without tight federal strings attached.
“I just see this as the new direction, a great direction for housing authorities. It’s good that we’re on the cutting edge of that,” said Melvin Scott, director of housing for the NWGHA.
Other housing authorities have reached out to Gibson to see how the effort is working in Rome, and have expressed interest in replicating it in other parts of the state.
“I’ve been talking to a couple of Department of Community Affairs people and I think they really like this idea,” Gibson said. “Especially the quality of what we’ve built.”
“We’re not charging (private) market rent, we’re charging HUD fair market rent,” said Hannah Phillips, development coordinator for the housing authority. “Our mission is to provide safe, decent and sanitary housing for low-income individuals.”
The housing authority is not selling any of the units it builds, as all are being leased. That’s another way the authority maintains control over the properties, and the tenants who lease from them.
It’s a concept that even has some private developers asking about the feasibility of hiring the authority to manage properties they would build around the community.
Walt Busby is one developer who is seeking to take advantage of the Section 8 housing market to build infill homes, largely in South Rome. He has indicated that the Childs and Fountain group will ask the NWGHA to manage new rental properties being planned for South Rome and Armuchee.