[ad_1]
Vineyard Creek Apartments are located not far from Charles M. Schulz-Sonoma County Airport, “nestled among the vines” next to an aging mobile home park.
The 232-unit complex, which includes a community garden and balconies overlooking a swimming pool, is marketed as offering the luxury of Wine Country, with units named for Syrah, Malbec, Riesling, and Zinfandel.
When the county was considering approving the project in the early 2000s, it was under pressure to comply with a court order to give the green light to more affordable housing. County officials have rezoned the commercial space near the airport to pave the way for Vineyard Creek. In exchange for zoning concessions and permits, Sonoma County developer Bill Gallaher agreed to designate 47 units of the complex for low-income tenants.
But a whistleblower lawsuit filed by a former employee in June 2019 raises questions about Vineyard Creek’s compliance with the deal. In her complaint, Mariah Clark, the resort’s former property manager, accused Gallaher-owned businesses of massive affordable housing fraud in Vineyard Creek, including overcharging low-income tenants and renting out some affordable housing to those that were not eligible.
The Press Democrat reported that Clark and five companies named as defendants in the lawsuit agreed to a settlement of $ 500,000 for allegations of retaliation and other alleged violations of the California labor code. The settlement would also result in the dismissal of the fraud allegations.
Three government agencies, the Sonoma County Community Development Commission, the California Attorney General’s Office and the California Department of Insurance all investigated whistleblower complaints and refused to join the trial.
Lawyers for the companies did not respond to repeated requests for comment on the lawsuit and settlement last week. Gallaher also did not respond to requests for comment.
When the project was first considered, critics feared that the complex – at the time, the largest residential development proposal in the unincorporated county – was a harbinger of urban sprawl. uncontrollable that would put a strain on municipal infrastructure.
But the desire for affordable housing won out.
The allocation of affordable units also allowed Gallaher to obtain cheaper financing.
On three occasions in the mid-2000s, California officials granted $ 35 million in tax-exempt bonds, which largely funded the construction of Vineyard Creek.
The state grants bonds to encourage projects that might otherwise have difficulty obtaining funding. Because investors don’t have to pay tax on income from bonds, they’re more likely to agree to lower interest rates for a developer.
The California Debt Limit Allocation Committee, a board that chooses which projects get tax-exempt status, is made up of representatives from the offices of the governor, treasurer, and state comptroller.
The board of directors allocated $ 23.5 million in tax-exempt bonds to Vineyard Creek in 2003. In 2007, when information at the time suggested the resort was already open for business, Vineyard Creek requested 12 , An additional $ 4 million in bonds, citing increases in construction costs and other expenses, according to committee documents and minutes. The committee granted the request.
Outside of Vineyard Creek, none of the companies listed as defendants in the whistleblower lawsuit have an affordable housing deal with the Sonoma County government, according to county officials.
In 2017, Gallaher secured an exclusive deal to purchase the 72-acre Chanate Road campus in the county for a housing project that could have included more than a hundred affordable units. Gallaher dropped out of the race for the project last fall, county officials said.
You can reach editor-in-chief Ethan Varian at [email protected] or 707-521-5412. On Twitter @ethanvarian
[ad_2]
