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Following the U.S. Department of Health and Human Services (HHS) denial of the Colorado Coalition for the Homeless plan to develop 59 acres near the Federal Center in Lakewood into a housing and resource center for the homeless, the coalition is contesting the denial and considering legal options.
“HHS's determination that the application is not approvable 'because it failed to meet threshold requirements related to the CCH's ability to finance the development and operation of the approved program use,' is erroneous, arbitrary and capricious,” wrote John Parvensky, president and CEO of the coalition, in a letter to HHS sent on March 27. He requested a response from the department within 10 days.
In that same letter, Parvensky wrote that HHS failed to provide the coalition with an opportunity to correct or supplement any information in its final application that HHS felt was incomplete, “even though other applicants under the Title V acquisition process have been able to provide such clarifications or supplemental information.”
Perhaps the most direct accusation in Parvensky's seven-page letter states, “HHS made conclusions in its determination that were not supported and are contrary to a reasonable interpretation of the law and fact.”
In the HHS letter of denial to the coalition, Theresa Ritta, program manager of Real Property Management Services for the federal department, wrote “the final application is not approvable because it failed to meet threshold requirements related to the CCH's ability to finance the development and operation of the approved program of use. More specifically … many aspects of the submitted financial plan are either incomplete or speculative.”
According to Ritta's letter, the coalition failed to include sufficient cost information on electric service infrastructure, water expenses, creating a solar farm, and ability to finance the project.
In the coalition's application, the plan was to utilize $5 million of an estimated $6,658,684 to be collected by organization related to the sale of apartments currently owned by the Renaissance 88 Apartments LLLP, of which CCH is a limited partner.
The Purchase and Sale Agreement between Renaissance 88 Apartments LLLP and Integra Housing Group LLC, dated June 27, 2017 that the coalition provided as supporting documentation, is only signed by the Renaissance 88 Apartments LLLP.
Ritta wrote, “A partially executed document is not legally binding and is therefore insufficient to demonstrate that CCH has $5,000,000 available to fund the development of the approved program of use.”
The final problem HHS saw, according to Ritta's letter, is related to funding Phase 1 of the project. For this phase, the coalition proposed building temporary housing for about 250 homeless people that could include trailers, geodesic domes and large tents.
“CCH stated that the proposed $2,664,231 operating budget for Phase I is less than 5 percent of CCH's 2017 operating budget and less than 73 percent of the net operating income for CCH in 2017,” Ritta wrote. “However, CCH declined to designate specific funds for operations, stating that CCH 'believe(s)' that the ongoing cost of Phase I can be absorbed by existing revenue sources without specific designation. It isn't clear why CCH would decline to designate specific funds in order to demonstrate its ability to fund proposed operations.”
Despite the coalition's assertion that it would undertake a capital campaign to support the program, Ritta wrote “CCH did not provide any information demonstrating past success with similar capital campaigns.”
Ritta was the point person on the HHS decision-making process, and as such, she was the person to whom neighborhood residents — who were both for and against the proposed project — wrote letters and messages.
A statement from Cathy Alderman, vice president of communications and public policy with the homelessness coalition, states “there are a number of documents that HHS deemed 'incomplete' which CCH could have easily provided to HHS, but CCH was not afforded the opportunity to submit those documents.”
Alderman said if HHS refuses the appeal and further information, the coalition will have no option other than to return to the U.S. District Court of Colorado to settle the matter.
“Because HHS has not provided any guidance on what a 'reasonable plan to finance the approved program' requires, CCH submitted the best plan possible to HHS with the understanding that there might be some points of clarification required in the process,” Parvensky said in a statement. “By categorically denying the plan outright without specifying the threshold or standard, HHS has attempted to essentially deny us the opportunity to exercise our mission and provide housing and services to those experiencing homelessness in Lakewood and Jefferson County."
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