City Manager Wally Bobkiewicz says that Evanston-based firms have done 40 percent of the work so far on its $18 million Neighborhood Stabilization Program grant.
Bobiewicz, responding to charges by a minority contractors’ group that local firms are being cut out of the program to rehabilitate 100 units of housing in two city census tracts because of the city’s partnership with Brinshore Development of Northbrook, said most of the work done so far has involved property acquisition and has employed Evanston-based architects, appraisers and attorneys.
He said that if title companies — of which there are none in Evanston — were excluded from the count the local share of the work would rise to 56 percent.
The city has pledged to award a minimum of 25 percent of total contracts to minority-owned, women-owned and Evanston-based businesses, but the Evanston Minority Business Consortium has demanded the share be raised to at least 60 percent.
The consortium has also complained that local non-profit housing groups were not allowed to assume Brinshore’s role as lead developer for the project.
The housing groups, known as Community Housing Development Organizations, have come under sharp criticism from aldermen in recent years for repeated cost overruns and delays in completing small-scale housing rehabiliation projects in the city.
Bobkiewicz says none of the local groups had the track record of success demanded by the federal Housing and Urban Development department as a condition for awarding the grant.
He also said that the federal requirement that half of the grant funds be spent within two years and that all funds be spent within three years was another factor in the city’s decision to partner with Brinshore.
“Having one entity responsible for program activities reduces the administrative costs associated with the grant” leaving more funds available for rehab work, Bobkiewicz said in a statement, and “assures a consistent level of quality throughout the program.”
The contractors’ group also complains that Brinshore will make millions of dollars through its multiple roles as developer, general contractor, sales agent and rental manager for the project.
But Bobkiewicz says Brinshore has arranged $31 million in private investor equity that will be used to fund a second phase of the stabilization program — construction of more than 60 units of mostly rental housing in a development the city is calling Emerson Square, centered around the former Bishop Freeman industrial plant on Foster Street across from the Fleetwood-Jourdain Community Center.
The city had initially requested $40 million from HUD for both phases of the project, and Bobkiewicz says without Brinshore’s ability to raise private capital the city would be unable to proceed with the new construction work.
The contractors’ group has scheduled a protest rally for 3:30 p.m. Saturday at the Lake Street Church to press its demands.
Related links
City statement on Brinshore (.pdf)
EMBC statement on Brinshore (.pdf)