Not so Cooperative
Thirty years ago the federal government deeded over 38 acres and 96 units of boarded up Navy buildings in North Kingstown to a non-profit group, to use for affordable housing. Now the Association to Save Quonset Affordable Housing Cooperative (ASQAH) and its management company are the target of a lawsuit by one of its residents, who says a rogue board has taken over the development while government officials look the other way. This week: Jim Hummel has her story and tries to get some answers of his own.
Click here to view the lawsuit.
In the spring of 1985 the federal government deeded over 38 acres of land, along with 96 units of long-boarded up Navy housing, to a non-profit group that had formed to help provide affordable housing in North Kingstown.
Even the name - The Association to Save Quonset Affordable Housing - or ASQAH as it is known in town - indicated the units would be designated for primarily low- and moderate-income families. The ASQAH cooperative bought the land for $10 - with it came a 30-year deed restriction aimed at preserving it as affordable housing.
Amicarelli: ``This sounds like a good deal.’’
Ellen Amicarelli worked for years in the mortgage lending industry and was intrigued because ASQAH was termed a housing cooperative.
Amicarelli: ``I knew some people who lived here who said, `Oh, this is the only housing cooperative in the state of Rhode island, and what you do is you’re an owner. You buy a share, you become an owner, it gives you the right to your unit. You have to do all the work, you get a mortgage write off, it’s just like you own the property.’”
Amicarell said the property manager for the development told her in 2013 she could `buy in’ for just under $5,000 - he called it a subscription fee, with a monthly rent - what they termed a `carrying charge’ of $531. She says he told her - and the bylaws reinforced - Amicarelli could get back the cost of improvements if she decided to leave.
Amicarelli: ``You can come in here, you’re responsible for all the deferred maintenance, so you’re responsible to do all the improvements to your unit - but just think at the end of the day, the carrying charges, it’s not rent, you all own this together. So it’s not rent, it’s carrying charges, and they’re under $600. And then he said: the reverter’s coming off the deed and you’ll own it.’’
Amicarelli said many of the residents she spoke with at the time said there was a buzz, that when the 30-year deed restriction came off in 2015 the property could sell for millions and those who lived here - and had bought in - would divide up the revenue.
So Amicarelli moved into Number 81, spending $20,000 of her own money to transform a dilapidated unit into what you see today. She has had health problems and financial challenges and saw it as an investment to securing future income, as she has no pension.
Then Amicarelli started asking questions, wanting to see financial statements. After all the original mortgage of $1.3 million from 1985 still has a substantial balance and ASQAH takes in more than half a million dollars a year from the residents. Where does all that money go? And what about the $5,000 subscription fee to get in? Amicarelli ran into an unresponsive board of directors and was quickly painted a trouble-maker.
She has tried to get answers from HUD, Rhode Island Housing, the town of North Kingstown, and others, all of which have distanced themselves from ASQAH, saying they had little involvement with or no control over the cooperative.
In 2011 Rhode Island Housing dropped ASQAH from its affordable housing list, because, a spokesperson tells The Hummel Report, it did not meet all of the requirements for Low- and Moderate-Income housing.
When Amicarelli tried to sell her unit more than a year ago - and recoup what she put in from a willing buyer, the board blocked her, according to a lawsuit she filed in Superior Court in June. She recalled a conversation she had at the time with the property manager.
Amicarelli: ``Sure, you can leave. I’m like I’m going to get my money back. He’s like: You have to ask the board. So I start emailing the board and said to him please tell the now president Gosselin, the guy down the end of my unit here, I want to leave, I was emailing him. I sent him like five emails, could you please arrange to do a walkthrough of my unit with the directors to determine the improvements I’ve done? He never responded.’’
DeLuca: They don’t know what they’re doing. And they’re taking big risks with these people’s property and money.‘’
Attorney Carl DeLuca, who represents Amicarelli, says he has spoken with some ASQAH residents in preparation for filing the lawsuit.
DeLuca: ``I understand there’s been a lot of intimidation from talking to some of the residents there, people who have tried to find out what’s going on have been ostracized. They basically defame them, and slander them and call them names and tell people not to listen to them because they’re crazy or stupid or whatever. People tried to bring up stuff, and the board of directors just walked out of the meeting. Just left.’’
That would include a board president who we found has two cars with license plates registered in Florida parked outside his unit.
A month ago we asked the property manager, Thomas Silvia, to have the board president contact us. Instead, residents told us, they were warned not to talk to a reporter who had been on the property.
We never heard from the chairman so we decided to try and contact him ourselves. There was no answer when we knocked on his door last week. Next stop: the office of the property manager.
Hummel: ``We spoke a couple of weeks ago. How are you doing?’’
Silvia: ``We did. Is this being filmed?’’
Hummel: ``It is.’’
Silvia: ``I don’t want it filmed.’’
Hummel: ``Did you pass our request along to Mr. Gosselin?’’
Silvia: I did. If you want to go ahead and leave, this is private property.’’
Hummel: ``We haven’t heard from him, though.’’
Silvia: `` That’s fine, I’ll call and give you our lawyer’s name, Michael Robinson.’’
Hummel: ``Have you been telling people not to talk to us?’’
Hummel: ``I’ve been talking to people….’’
Silvia: ``Not at all.’
Hummel: ``They said you sent out the message not to talk with us.’’
Silvia: ``That’s not true. Have you seen that message?’’
Hummel: ``Well, I’ve heard it from…I’ve talked to a number of people who live here.’’
Silvia: ``Then I would ask them to see what I sent out.’’
Hummel: ``Well, so what about we wanted to get some information, who do we need to talk to about that?’’
Silvia: ``Please leave.’’
Hummel: ``I’m just asking you, what the contact information. You don’t own this property, do you?’’
Silvia: ``I do not.’’
Hummel: ``So what right do you have to tell us to leave?’’
Silvia: ``I’m the property manager here.’’
Hummel: ``I’m a guest of people on this property.’’
Silvia: ``I’m calling the police, then.’’
Craven: ``Clearly there needs to be some legislation for cooperatives of this nature, to account to someone. ‘’
North Kingstown Representative Robert Craven met Amicarelli when he was campaigning last fall and is following her case closely.
Craven: ``One would presume, I did, I fall into that category, presumed that HUD did those things, or Rhode Island Housing on behalf of HUD their local partner, did those things and that does not seem to be the case here.’’
A spokeswoman for HUD tells the Hummel Report the agency only insures the mortgage, but does not - and never has - required ASQAH to be affordable housing. Part of its oversight includes inspections and financial reports, both of which we asked for nearly three weeks ago. The spokeswoman said they would not be available until later this month, adding she wasn’t sure they were quote: `releasable.’
Americarelli says HUD is not telling the whole story and recalled a telephone conversation she had with a high-ranking HUD official in Washington last year.
Amicarelli: ``He told me in May: He said Ellen, we know, we know, we know, we have a serious problem here. We’re getting calls from all over the country. I said on ASQAH? He said no, Ellen, on this exact same problem. Rogue boards.’’
Hummel: ``Is that what it comes down to?’’
Amicarelli: ``Yes! They’re not following the bylaws, they didn’t maintain the property, they didn’t take care of the property.’’
Hummel: ``And who’s responsible for making sure that they do?’’
We had trouble even finding out who is on the board of directors or any other information because state law does not require ASQAH to list any of it publicly, or file a yearly report, as virtually every other corporation in the state is required to do.
DeLuca: ``When people try to sell something, they’ll puff it, beyond the terms of the ultimate agreement, and then they’ll say well the agreement doesn’t say that. That may be innocent when it’s done once or twice. But if they’re telling people or did for a continuous period of time things that were not true, or not in the written agreement, then that becomes a potential problem because it is an intentional fraudulent inducement.’’
Many of the units are in run-down condition. Even though Amicarelli has made significant improvements to hers, the bathroom is still a problem, with leaks and mold, and a management that she says refuses to fix the problem.
And DeLuca says, she is not alone.
DeLuca: ``These were low income housing units - they should have been in good shape when they were given to people. People shouldn’t have had to go in there and have to fix anything.’’
DeLuca says as a cooperative the residents could vote out the board and fire the management company whenever they want, but many are hesitant because they see how Amicarelli has been treated.
DeLuca: ``They’re afraid, they don’t want to lose what they have over there, so when they’re told to shut up and get in line, which has happened in this case, they shut up and get in line. Sometimes they grumble and they’re knocked down and they don’t talk anymore.’’
Amicarelli has pleaded with HUD and the Rhode Island Attorney General’s office to investigate.
Hummel: ``When you invested that money you thought, well, down the line I’ll eventually get this money back.’’
Hummel: ``There was no question in your mind.’’
Amicarelli: ``There was no question.’’
DeLuca: ``They did induce these people to fix them up as much as they want and they can get their money back - and she has records to demonstrate that. They were fully apprised of what she did and when she did it. She’s not asking them to pay it, she’s asking for someone coming in to pay it. And there are people who have been willing to do that.’’
Craven: ``If there was any intent or deliberate actions on the part of the people that sold her the unit, or cooperative itself, then under that circumstance it isn’t a phantom leap to think her original $5,000 deposit, along with the sale of this unit to her was done under false pretenses. That’s a crime, that’s a felony, people go to jail for those things.’’
In North Kingstown, Jim Hummel for The Hummel Report.