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Miami Herald - January 23, 2006

Budget housing plan on track

A Broward County housing program that offers free land to developers willing to ensure low sale prices is on schedule to produce its first homes this year.


Home-building giant Lennar Homes has been tapped to build affordable housing on 19 county-owned lots, a key step in a program meant to create more than 100 moderately priced houses in Central Broward neighborhoods.

Lennar and county officials say they are negotiating a contract and plan to be ready for a County Commission vote next month.

The county hopes that free land and speedy permitting will allow efficient, low-cost construction and ease a growing shortage of homes affordable to everyday workers.

''We want to build these houses and get people into them quickly,'' said County Commissioner Josephus Eggelletion, who represents the area. ``I feel very confident now that some of these neighborhoods can turn themselves around.''

Broward County owns roughly 110 vacant lots and plans to release them to developers in batches of up to 20 at a time, providing free land in exchange for long-term price caps. The lots, many acquired after owners failed to pay taxes, are scattered throughout Roosevelt Gardens, Washington Park and other central neighborhoods where private-sector interest in redevelopment is growing.

County officials have said they would like to expand the program to include vacant lots with unpaid taxes within cities.

Several small builders and nonprofit agencies have complained that county-imposed insurance requirements and a ban on using the land as collateral for loans have boxed them out of the housing program. Of 15 builders preapproved to bid on county lots, only Lennar managed a valid bid on the first 19.

''We just weren't able to do it because the ground rules were out of our reach,'' said Jacqueline Tufts, executive director of the nonprofit New Visions Community Development, noting that the bonding requirements alone -- a form of construction guarantee -- would have cost about $1.5 million.


``I don't think the playing field is fair when you say you have to provide bonding and financing up front.''

Eggelletion said he, too, wants smaller businesses to be able to compete for the lots. He said he hopes to fix the problem before the next lots go out to bid, possibly by reducing bonding requirements and allowing developers to bid on five or 10 lots at a time.

''Historically, most of the affordable housing has been built by small developers,'' he said. ``Now that there's a big push, I think it would be unfair to abandon them and give the land exclusively to big, market-rate developers. I always want to dance with those who brought me to the dance.''

Lennar's plans call for 19 single-family homes in the Roosevelt Gardens neighborhood, with prices pegged at $130,000, $160,000 and $220,000, depending on the size and model. All of the homes will have at least three bedrooms, two bathrooms, and a single-car garage.

If an agreement is reached with the county in the coming weeks and construction goes smoothly, the homes could be finished by the fall.

New Visions has signed on to help market the homes and will provide down payment and other assistance for 10 home buyers. The remaining nine buyers are expected to receive assistance through a county program, officials said.

As the last large tracts of open land disappear in Broward County, Lennar's local operation has increasingly turned its attention to smaller redevelopment projects in or near urban centers. The company has produced affordable housing in Fort Lauderdale and Pompano Beach, among other places.

Construction costs on the 19 homes now under consideration are expected to reach $2.7 million, with sales revenue to bring in $3.1 million. Profits of roughly $20,000 a home are modest for Lennar, the nation's largest home builder.


But Lisa Maxwell, Lennar's redevelopment director, said the company hopes to demonstrate that government incentives like free land can produce housing faster than fees or mandatory price caps on portions of each project.

''What we are attempting to demonstrate is that through a public-private partnership, low- to moderate-income earners can actually get a roof over their heads,'' she said.

``And that's really what the goal should be.''