According to Meridian Housing Authority Executive Director Ron Turner, there is a simple explanation as to why the agency has been foreclosing on a number of properties over the past few months.

As an example, the Sept. 7, 2016 edition of The Meridian Star included seven legal ads listing the address of properties foreclosed on and amounts borrowed against them. MHS addresses and amounts borrowed included 1920 37th Ave. ($82,500), 2601 16th St. ($60,759), 2605 16th St., $78,369), 2607 16th St. ($60,289), 2701 16th St. ($60,289), 1520 Valley St. ($60,726) and 1520 28th Ave. ($43,900).

Turner blamed U.S. Department of Housing and Development (HUD) for not providing funds so the MHA could maintain its properties. That led to a number of foreclosures of properties that MHA operated.

The 87-unit Queen City Apartments is privately-owned and consists of 26 properties comprised of multiple duplexes, triplexes, and quadplexes throughout Meridian.

“In 1987, the Meridian Housing Authority reluctantly assumed financial management and responsibility of several turnkey housing units at the request of Department of Housing and Urban Development (HUD,” Turner said in a prepared statement. “Overwhelming demands for affordable housing existed in 1987 and currently exist today, so the MHA Administration at the time of purchase was highly encouraged to include the Queen City development into its affordable housing inventory. The properties never obtained or sustained the level of cash flow promised by a former HUD administrator.”

Turner said Queen City turned out to be a financial disaster.

“MHA paid out thousands from its non-federal reserved proceeds in an effort to sustain the properties,” Turner said. “MHA’s current administrative staff plan to rehabilitate the Queen City properties was based on a successful award in 2014 low-income tax credits from the Mississippi Home Corp.”

Turner said economic factors before the tax credits were awarded led to a money drain.

“Unfortunately, a change in the IRS regulations governing the tax credit program reduced the 2014 allocation rates from 9 percent to a floating rate of about 7 percent that created a $1 million funding gap for the rehabilitation project,” Turner said. “After years of faithfully making mortgage payments on the declining properties and expending more than $900,000 of the agency’s non-federal funding in an attempt to provide much-needed affordable housing options, MHA could no longer support the debt service on the existing properties without negatively impacting the quality of life for its public housing residents.”

Turner said foreclosure was the final step.

“After several failed attempts to encourage HUD to restructure the $1.4 million debt service on the property, MHA was forced to default on the 26 FHA-insured mortgages. Foreclosure proceedings on these vacant mixed income properties are currently underway,” Turner said.