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Accusations fly on project delay

November 30, 2008|By DAN DEARTH

HAGERSTOWN -- The president of the Hagerstown Neighborhood Development Partnership (HNDP) said the organization is moving ahead with a 4-year-old concept to redevelop the first block of East Baltimore Street despite accusations that the city had dragged its feet on the project.

HNDP President Richard W. Phoebus wrote in a letter dated Oct. 2 and sent to the Hagerstown mayor and city council that HNDP officials began borrowing money to acquire the former Massey Auto Body property at 28-50 E. Baltimore St. after receiving "assurances from the city" that federal money would be available to help fund the project.

"In fact, the Community Development Department created overwhelming liabilities for the Hagerstown Neighborhood Development Partnership," Phoebus wrote. "HNDP never received a significant portion of the multi-year allocation. The residential redevelopment project was ineligible for Community Development Block Grant funds."

Community Development Block Grants are awarded by the federal government and distributed by the city to help fund qualifying projects.

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Phoebus wrote that "while the mayor and city council supported redevelopment of 28-50 East Baltimore Street by approving funding in the Community Development Block Grant budget, the actions of city staff contradicted those good intentions."

Phoebus said in a telephone interview in mid-November that progress has been made since the letter was written.

"It's not a static situation," he said. "We are moving forward in some areas."

Mayor Robert E. Bruchey II said Tuesday that the city drafted a letter in response to the one written by Phoebus, but never sent it.

"I don't want to point a finger," Bruchey said. "I think we need to sit down and find a consensus.

"The worst thing that happened with the Baltimore Street project was the (housing market). It's really no one's fault. The bottom just fell out."

Bruchey said the city has discussed "some options" concerning the use of the property, but "nothing has been finalized."

"It's going to have to be a team effort," Bruchey said.

Early plans

HNDP was created in 2003 to partner with the city to increase residential and commercial development in and around downtown Hagerstown.

The Herald-Mail reported in September 2004 that HNDP and the city agreed on a plan to build between 20 and 30 new homes on the former Massey property, which housed Massey Auto Body, several run-down residential units and a large parking area.

Phoebus said back then, HNDP's plan was to build homes that would attract people with moderate to high incomes.

Shortly after the project was approved, HNDP officials borrowed about $1 million to purchase the Massey property, with about $750,000 of that money coming from local banks, Phoebus said.

The remaining $250,000 was loaned by the Hagerstown-Washington County Industrial Foundation Inc., known as CHIEF, a private, nonprofit group that has played a major role in building industrial parks and luring companies to Washington County.

Phoebus said HNDP purchased the land in February 2005.

Phoebus said it was not until spring 2006, however, that city staff reviewed "the Maryland Historical Trust mapping, which indicated that three buildings on the site were historic, preventing use of federal and state funds if redevelopment involved demolition."

After HNDP officials learned that federal funding would not be available, Phoebus said, HNDP voluntarily stopped drawing funds that were being used, in part, to maintain the property and pay property taxes.

To date, HNDP has spent more than $1.3 million on the Massey property, Phoebus wrote, "due in great part to our reliance upon commitments from the Community Development Department -- commitments which did not materialize."

Asked whether the city staff handled the matter in an appropriate manner, Phoebus said, "I think the letter speaks for itself."

Phoebus also contended that city officials refused HNDP's request for other assistance with the Massey property, including a waiver of real property taxes and assistance with maintenance.

But within the last few weeks, the city has agreed to work with HNDP officials to resolve certain code violations associated with the property, including graffiti and broken windows, he said.

City was 'good partner'

When asked about the letter, Community Development Manager Larry Bayer referred questions to City Administrator Bruce Zimmerman.

Zimmerman said the city has been "a good partner" to HNDP by allocating about $1.2 million to the organization since it was formed, and has a good record of helping other nonprofit organizations receive public funding to refurbish buildings downtown.

As examples of such projects, Zimmerman mentioned the University System of Maryland at Hagerstown, the Academy Theatre Banquet & Conference Center, which formerly was the Tusing Warehouse, and the Barbara Ingram School for the Arts.

"We're not going to let (Phoebus') letter slow us down," Zimmerman said. "We're going to move forward in a positive way."

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