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CEO Promises New Day for Embattled Housing Company

November 10, 2009


Mount Hope Housing Company was founded in 1986. Its mission: to provide safe, affordable housing for residents of the Mount Hope neighborhood, and in the process fight back against the urban decay that was ravaging much of the south Bronx.

Today, the organization manages more than 30 apartment buildings and provides a range of vital services, such as GED classes, to local residents. In the words of Xavier Rodriguez, Community Board 5’s district manager, Mount Hope is one of the area’s “Fortune 500 companies.”

But, behind the scenes, all has not been well these past few years. Tenants say they’ve noticed a drop-off in services. They say the buildings and apartments have been neglected, that repair requests are ignored, and that Mount Hope has been contributing to the problems it seeks to combat.



Tenants’ Anger Bubbles Over

In September 2008, approximately 50 tenants living in 1892 Morris Ave. took Mount Hope to court for failing to maintain the building.  That November they began a rent strike which continues to this day.

Tenants there complain of faulty elevators, broken locks on the building’s front doors, sporadic heat and hot water, and broken security cameras. Residents of other Mount Hope buildings have similar concerns.

“I’m not satisfied at all,” said Maria Mercado, a resident of 1789 Davidson Ave. “To fix the
apartments, they take forever.”

“Everyone is unhappy. They’re like ‘this place is just horrible,” said Gloria Rivera, who lives at 1800 Davidson Ave. “Some of these people are good hardworking people. It’s not fair what’s going on.”

At 2059 Davidson Ave., tenant Yessica Alcantara showed a reporter two gaping holes in her bathroom ceiling. Mount Hope had someone fix leaks in her ceiling a year ago, she says, but no one returned to patch things up. “We pay our rent every month and it’s just like ridiculous,” she said.

George Clardy, the husband of Leona Clardy, a Mount Hope founder who died in 2005, has no complaints himself. But he says he’s regularly stopped in the street by fellow tenants with a Mount Hope-related gripe on the tip of their tongue.

“I know, and I’ve heard, a lot of displeasure,” Clardy said.

New CEO: Mistakes Were Made

Of course, not every tenant is dissatisfied, and not every issue can be blamed on Mount Hope – it’s not Mount Hope that breaks the locks on buildings’ front doors, for example. Moreover, the buildings are aging, and costs, such as heating oil, have shot up recently, making effective management difficult.

But even top-level staff and board members admit that mistakes have been made.

They say Forrest Branch, the company’s property manager until earlier this year when he was fired, failed to address tenant complaints in a timely manner, if at all. Under his watch, legal fees soared (because Mount Hope had so many court dates with tenants), as did other expenses.

Meanwhile, the buildings’ Con-Edison and water bills were left unpaid, and debt mounted.

Adding to this, the organization was galloping forward, and not looking back.



“Over the last three or four years… we took our eyes off the prize, the prize being service to our tenants, and the stability of our buildings,” said Fritz Jean, Mount Hope’s new CEO, in an interview last month. “We took our eyes off that and started looking into development. That is fine, because we have to grow, but it is not fine when we do that at the expense of our existing… portfolio.”

Jean took charge in June, replacing Shaun Belle, who had been with the organization 13 years. He says Belle’s leaving was a “mutual decision” between the board of directors (Jean was then president of the board) and Belle.

According to Jean, Belle focused on new projects – including the new community center on Townsend Avenue – and didn’t give the buildings the attention they needed.

Specifically, during the latter years of Belle’s tenure, close to $4 million was moved from several
buildings’ reserve accounts (money put aside for major improvements, a common real estate industry practice), Jean said, to help fund Mount Hope’s new community center, social services programs, and other projects. This, Jean said, despite the organization being told by the Department of Housing Preservation and
Development (HPD), to leave the reserves intact.

“Many of the funding reserves, a good portion of it, was used to trigger new development, and that’s a problem,” Jean said.

Asked about the reserves, Belle wrote in an email: “The use of MHHC reserves… was consistent
with its mission.”

He added: “At no point, could the CEO or other staff unilaterally or independently approve any of these activities as all such transactions required board involvement and approval as exhibited in all company records.”

But it remains unclear as to whether board members knew HPD had asked Mount Hope not to touch the reserve money. The Board trusted Shaun, said one staffer with knowledge of the situation.

Jean said he believes the money went back into Mount Hope, not people’s pockets. But that hasn’t stopped the city’s Department of Investigations (DOI), an agency that investigates fraud and corruption, from looking into Mount Hope’s finances, and asking for documentation, which Jean said they’ve provided.

A DOI spokeswoman would neither confirm nor deny that an investigation was under way.

A Corner Turned?

Jean, a 43-year-old lawyer who lives in Brooklyn and is a childhood friend of Belle’s, has made significant changes since becoming president of the board in February and then CEO in June.He’s laid off at least seven staff, cut remaining staffers’ salaries by 7.5 percent, and says he’s tried to install a better work ethic.

Moving forward, Jean says, the focus is on addressing tenants’ concerns; ensuring Mount Hope’s different departments (such as Youth and Adult Services) become self-sufficient; replenishing the buildings’ reserves; ensuring a system is in place to guard against the reserves being “purged” again; making Mount Hope’s finances more transparent; and ultimately restoring HPD’s and other partners’ confidence.

Jean says Mount Hope has managed to pay off some debt, and to address problems in the worst
buildings, including one on Creston Avenue.

Key figures in the community are rooting for him.

“I think Fritz is going to turn things around,” Clardy said. “His head and his heart are in the right place. I keep telling folks, give him a chance.”

“I think he’s on the right track,” said Cleo Boyd, one of Mount Hope’s founders and a longtime
board member.

Jean believes Mount Hope has turned a corner, but he fears funders and partners could decide to bring someone else in to manage the buildings.

“Ultimately they [HPD] have a decision to make, the same thing with all the partners,” he said.“My only hope is for them to say, ‘You know what? Mount Hope historically has been a very good organization. Hey, Mount Hope you dropped the ball three, four years ago. We noticed that you took made decisions, and this is
your plan going forward. We want to [give you another chance].’ That would be a beautiful scenario for us.”

Joyce Hilliard, the president of the tenants association at 1892 Morris Ave., the building that
is on rent strike, says a new management company might be just what the doctor ordered. But
Jean thinks it would be sad day if Mount Hope was forced to scale back.

“Mount Hope is a minority-run organization,” Jean said. “The number of individuals who have come through here from different walks of life and have received their training to move on [is tremendous]. To close that [door] would be a shame.”

He added: “I believe in Mount Hope, what it stands for, what it stands for in the community. And I’m going to commit myself 110 percent to make it what it’s supposed to be.”

Additional reporting by Linsey Isaacs.

Ed. Note: For help and assistance, Mount Hope tenants can call the organization’s customer service hotline at (866) 279-6388. Mount Hope is looking for board members. For information, call the main office at (718) 583-7017.


One Response to “CEO Promises New Day for Embattled Housing Company”

  1. YEAR IN REVIEW: The Latest on Three New Community Centers : Mount Hope Monitor on January 8th, 2010 7:18 pm

    [...] has his plate full.  On top of getting the new center open, he has to turn the organization’s dire financial situation around, and ensure Mount Hope’s 30-plus apartment buildings receive the care and attention they [...]

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