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Oakland to sell site for affordable housing, businesses

A proposal to transform a once-blighted West Oakland parcel into affordable housing, an urban farm and businesses run by formerly incarcerated people advanced this week when the City Council approved the property’s sale to a nonprofit on a second reading,
Oakland & the World Enterprises, which is buying the parcel, envisions 59 to 79 apartments, an urban farm, a small grocery store, a fitness center, a small restaurant/cafe and a technical support center on a corner of the site sits on Seventh Street across from the main Oakland U.S. Postal Service sorting facility. The West Oakland BART station is about a third of a mile to the east.
“We’re a small developer, but we have a big mission. Our mission is to not only create decent, truly affordable housing in a depressed community of Oakland, but also to create a model of community economic development,” Elaine Brown, the nonprofit’s CEO, told the council Economic and Development Committee on June 13.
“One of our primary missions is to launch businesses for ownership by formerly incarcerated people and economically marginalized people,” she said.
Brown was criticized by the Alameda County civil grand jury earlier this year, although it did not use her name. According to the panel, Oakland & the World Enterprises was formed by Alameda County Supervisor Keith Carson and Brown, who is on his staff. Carson hired Brown to get the nonprofit up and running; she is both a county employee and unpaid CEO of Oakland & the World Enterprises, the jury’s report said.
Brown’s role in the county giving the nonprofit more than $800,000 was a conflict of interest, according to the grand jury.
The money included $102,527.24 in county money for predevelopment expenses for the affordable housing. Another $710,000 total was allocated in four different disbursements from Carson’s fiscal management reward program account. Supervisors often give money from that program to nonprofit organizations to provide services or benefits to Alameda County residents, according to the grand jury. Brown requested funds from Carson for Oakland & the World Enterprises, the report said.
“As far as the grand jury can determine, there was no county oversight” over the funds given to the nonprofit other than by Carson and Brown, according to the grand jury.
Brown “was wearing ‘two hats’ in connection with these transactions, in that she was actively involved on both sides of those transactions, as both a county employee and as an advocate for OAW,” the grand jury report said.
By owning the site rather than leasing it, Oakland & the World Enterprises improves its chances of getting funding for the project, according to a staff report.
Affordable housing projects on leased land are harder to get financing for, according to Oakland & the World Enterprises.
“Since we may eliminate some lenders because we will not exclude ex-felons or those with criminal records from renting since they are our target population, a lease rather than ownership will narrow the field of lenders even more,” the nonprofit wrote in a report to the city.
Oakland & the World Enterprises will partner with Community Housing Development Corporation, of Richmond. Community Housing has experience building affordable housing.
“We have a  big budget; we’re looking for $24.5 million. We will be seeking that money through a variety of means, through state tax credits, through cap and trade money, through tax-exempt bonds, new market tax credits, and private funders,” Brown, a former Black Panther Party member, told the committee.
The city has owned the site since 2013. Oakland’s Redevelopment Agency loaned money to an earlier nonprofit to buy most of the parcels that make up the site. The nonprofit went under, leaving the loans unpaid, and Oakland purchased the foreclosed property in 2013.
Oakland & the World Enterprises has been operating the farm on a portion of the three-quarters of an acre site since 2014. The farm has cut down on illegal dumping, which has been a problem at the corner, according to a staff report.
“The urban farm on the property turned what had been blighted property for many, many years to some significant and productive use,” said James Nixon, an Oakland & the World board member.
Nixon said what especially drew him to the project was that it provides a comprehensive opportunity for people who were formerly incarcerated or economically disadvantaged.
“They can live in the affordable housing in the top floors of the mixed-use development, and they can work and actually be owners of businesses on the lower floors,” he told the council committee.
If the project is successful, it could potentially be replicated at other sites in Oakland, Nixon said.
The city will sell the property to Oakland & the World at a “nominal price,” according to a staff report. The site is valued at an estimated $1.4 million, the report said.
Oakland also will loan up to $2.6 million for the affordable housing part of the project.

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