By Matthew K. Roy
PEABODY — Habitat for Humanity wants to partner with the city and renovate three condemned homes on Park Street.
The nonprofit organization that relies on volunteer labor and donations of money and materials to build homes for low-income families has proposed spending $1.5 million to purchase 5, 12, and 14 Park St. and transform them into eight affordable homes.
Donald Preston, president of Habitat for Humanity North Shore, wrote in a letter to the City Council that his organization would request that the city contribute $500,000 toward the project.
The proposal sparked councilors' interest, and they voted Thursday to invite Habitat to deliver a more detailed presentation at a meeting of the Industrial and Community Development Committee.
"Five-hundred thousand (dollars) for eight (affordable) units isn't bad," Councilor Jim Liacos said. "That's certainly, from my point of view, worth bringing in Habitat."
The three homes on Park Street are casualties of the foreclosure crisis that has swept the country. In June, the council approved a pilot program crafted by the city's Community Development Department that intended to use $500,000 to help spur the redevelopment of the properties. The city, according to the program, would provide a low-interest loan to a developer.
Money for the loan was to be drawn from $1.2 million the city received as part of an "inclusionary zoning buyout." The developer of the Highlands at Dearborn apartment complex paid the city the hefty sum in lieu of including affordable housing in a 446-apartment development.
Over the summer, the city solicited bids from developers to participate in the pilot program but received only one response. Casco Bay Holdings, the bank that owns 5 and 12 Park St., offered to sell the two properties to the city for $460,000, Community Development Director Jean Delios said. Owning the blighted parcels is not a goal of the city, she said.
Under Habitat's proposal, the city would provide $500,000 to the organization in the form of a grant. The offer is attractive to councilors because the investment would help create eight below-market-rate housing units instead of the four called for in the pilot program.
"Eight affordable units is something we should really explore," Councilor Anne Manning said.
Affordable housing is a pressing concern because the city's affordable housing stock could fall below 10 percent after the 2010 census. Now, with 10.4 percent of its housing stock considered affordable in the eyes of the state, Peabody has more leeway to reject or control so-called 40B development. The 40B refers to a state law that allows a developer to skirt most local zoning rules if a portion of a development is set aside for affordable homes.
Delios touted Habitat's project as a way to add to the city's affordable stock, promote home ownership and improve a neighborhood by breathing life into distressed homes. Habitat would like to put two units each at 5 and 12 Park St. and four townhouse-style units at 14 Park St.
Council President Arthur Athas said the city needs to find out what neighbors think of Habitat's plan. He also wants more detail about what other funding sources the group will tap.
In his letter, Preston mentions the possibility of using Peabody's Community Preservation Act money. The act empowers the city to raise money by adding a 1 percent surcharge to property tax bills.
