Fairfax County supervisors this week questioned why two nonprofit groups needed to restructure their loans for affordable housing projects, raising concerns that the county had become a financial fallback for nonprofits in trouble.
Proposals from both the Wesley Coppermine Limited Partnership, which runs a 66-residence development for the elderly in Herndon, and Chesterbrook Residences Inc., which runs a 97-unit assisted-living facility in McLean, came before the board on Monday. Chesterbrook was seeking an additional $275,000 loan from the county after seeing shortfalls due to an unexpected stream-restoration project. Wesley sought to restructure the terms of its $794,000 county loan after ongoing construction caused overly high vacancy rates at the development.
While supervisors eventually appeared satisfied with the explanations for the shortfalls from housing officials, there appears to be lingering unease that the requests represent a trend as the county enters grim budget years and competition for public dollars grows ever fiercer.
“I still think we need we need to be very, very careful, because the county cannot be expected to bail out partners that have overreached,” Mason District Supervisor Penny Gross said. “The well has only so much water in it.”
It remains unclear how the recent downturn in residential tax revenues will tighten Fairfax County’s affordable housing program, in which the county partners with nonprofits to preserve low- and mid-priced units.
“I think we need to be sure that we know what is going on financially … when you have any organization that is dependent on contributions,” Providence District Supervisor Linda Smyth said. “When you have an economic downturn, anything like that can happen that can strain their financial resources.”
