By Sean Keenan and Maria Saporta
Atlanta’s housing authority will have to foot the bill for a years-long legal battle with developer Integral Group and its business partners with non-federal cash, despite the public agency’s efforts to get permission to use U.S. Department of Housing and Urban Development (HUD) funding for the fight.
Additionally, on Friday, Integral Group filed a motion in the Superior Court of Fulton County to “enforce the terms of the settlement agreement reached with [Atlanta Housing]” — a deal approved by the AH board in February that mandated the housing authority would have to pay the Integral Group team $1.8 million for its legal troubles, as well as convey nearly 80 acres of land neighboring four of the development group’s mixed-income communities to a 50/50 partnership between the two parties.
The message of the motion seemed clear: Quit stalling, pay up and transfer the land we’re owed.
“Though the settlement agreement is binding, that is not enough to stop AH board chairman and [former Atlanta Mayor] Kasim Reed appointee Christopher Edwards, who presided over the board meeting where the settlement agreement was unanimously approved, from continuing to seek ways to get AH to avoid honoring the terms of the agreement,” according to a press release announcing the motion.
HUD approved the settlement deal in March, signaling an end to the feud that kicked off in 2017 with allegations that the housing authority, under the leadership of then-CEO Renee Glover, engaged in “sweetheart” land deals with Integral Group. (Both Glover and Integral Group officials dispute such an interpretation of the dealings.)
Ninety-five percent of AH funding comes from HUD, and the local agency asked the federal one to approve the use of federal dollars to clear the debt with Integral Group and its development partners, and to pay its own lawyer fees. But, according to AH CEO Eugene Jones, “[HUD’s] office of general counsel said this case did not qualify for federal funds.”
Having to come out of pocket for the $1.8 million bill — plus AH’s own legal fees — means, “We have to look at how we strategize our resources on protecting our residences, providing social services, meals, mental health and other services,” Jones told SaportaReport in an interview.
But HUD’s regional administrator Denise Cleveland-Leggett told SaportaReport it’s “just protocol” to turn down AH’s request to use federal funds for the long-running legal melee. In fact, the federal agency told AH in March that it couldn’t use HUD cash for the fight, but AH officials kept trying to get the green light to do so, she said.
“If you’re going to file lawsuits, you have to ultimately make the determinations of what you think is worth it, and now they have to make determinations of how they’re going to utilize their funding,” she said in an interview.
After all, Cleveland-Leggett added, public housing authorities shouldn’t be spending energy fighting in court when they could sooner “focus on housing and job creation and so many incredible things that are significantly more important, especially during COVID.”
A few weeks ago, Cleveland-Leggett was in Miami-Dade County, where she participated in two groundbreakings of “incredible projects” that would add to the inventory of affordable housing in those communities.
By comparison, she has not seen that kind of activity in Atlanta.
“It really hurts my heart that in the city I love, I see a once-storied housing authority falling behind,” Cleveland-Leggett said.
In July, HUD shot down AH’s dispossession application, meaning the local agency “is going to have to redo our application,” Jones said. It’s yet unclear when or how the land conveyance could pan out, although the terms of the settlement agreement dictate that the properties in question host the development of 2,035 residences, 389 of which would have to be earmarked as “affordable” for households earning between 80 and 120 percent of the area median income.
AH officials were not immediately available to comment on Integral Group’s motion or Cleveland-Leggett’s remarks, and this story will be updated as more information is provided.