New tenants in Hialeah’s affordable housing will see rent hikes, despite mayor’s promise

Facing a financial burden stemming from rising maintenance costs, Hialeah voted to turn over 625 affordable housing units that it had managed to a state housing agency, a move that likely will mean higher rents for new tenants.

In an unanimous vote at the April 23 council meeting, the council members agreed to retain ownership of the units, housed in 14 properties throughout the city, but they will be managed and maintained by the Hialeah Housing Authority. The authority is a state agency that receives funds from the U.S. Department of Housing and Urban Development. It operates 1,117 public housing units and manages 5,128 Section 8 vouchers within the state, according to HUD.

Ruth Rubi, the city’s finance management director, said at the meeting the rent increases will affect new tenants, not existing ones.

“The legacy tenant will remain the same...The increase comes in the form of a voucher, Section 8, on basically empty units,” she said.

That’s different from what Mayor Esteban Bovo Jr. said in a Jan. 9 council meeting, when he first presented the proposal to have the state agency take over the units. Bovo emphasized three times, “We will not raise rents on the city’s housing.”

The council did not vote on the matter at that time.

Higher rents

Currently, 40 of the 625 units have been vacant for months due to ongoing repairs, according to Rubi. The vacant units will now be leased for $1,239 a month with Section 8 vouchers or other rental subsidies.

The rent charged on the units now ranges from $300 to $1,070, depending on the length of time the tenant has lived there, according to documents reviewed by el Nuevo Herald. In many cases, a building can have up to four different rents.

This will be the first time Hialeah’s affordable housing will take federal Section 8 vouchers, said HHA Director Julio Ponce. HHA will also make the units available to renters who don’t need vouchers or additional subsidies.

“If someone on another waiting list or not on any list comes looking to rent a unit in these city properties, we will rent it to them for $1,239,” said Ponce.

The mayor’s chief of staff, Ismare Monreal, told el Nuevo Herald that Hialeah will receive more money through federal funds, so tenants will pay less out of pocket.

The agreement between the city and HHA for managing these properties would be a minimum of five years, with potential renewal, through a 6 percent fee. This will cost the city approximately $150,000 in the first year.

Although the increase in rents is now official, the city has been raising rents on these properties as they became vacant for some time.

Jesus Tundidor, council president, told el Nuevo Herald that in the city’s largest property, Daisy & Rosa, “rent has been honored until the end, but when someone dies and the unit becomes available, rent is charged at market price.”

Councilman Bryan Calvo, the main opponent to Mayor Esteban Bovo Jr., says HHA’s management should benefit residents because there have been maintenance issues for a long time.

“No one wants to raise rent, but the most important thing is that no apartment remains vacant,” said Calvo. “The most concerning issue is that there are 40 vacant units. It’s disheartening when there’s so much need.”

The revelation of 40 vacant units in Hialeah’s affordable housing comes after thousands of people lined up at the John F. Kennedy Library to register for the Section 8 voucher lottery for 1,000 slots just opened by HHA.

Financial challenges of Hialeah’s affordable housing

According to a letter sent by the finance director, Rubi, to council members, the affordable housing program faces financial challenges because the city has been subsidizing part of the property expenses, mainly because the rental income does not cover annual maintenance costs.

Rubi projected an affordable housing shortfall of $1.061 million to be subsidized by the city’s general fund for 2024.

El Nuevo Herald requested the budget for these affordable housing units, and the city sent documents from the past five years showing revenues, excluding the expenses incurred by the properties.

The records show a significant increase in funds being transferred to cover the rising deficit stemming from operating these units. Over five years, a total of $2.87 million was transferred out of the city’s general fund to cover these costs.

The records do not detail the expenses incurred by each property.

This subsidy has led to a “significant financial burden that the city must address,” Rubi said.

The chief of staff estimates that with this new agreement, Hialeah will be up to date by 2027.

READ MORE: Struggling to stay in Hialeah: Evictions surge in new luxury enclaves

HUD and local code violations

Much of Hialeah’s affordable housing is currently funded through the HOME Investment Partnerships federal program , which is the largest federal grant to state and local governments designed exclusively to create affordable housing for low-income households. According to HUD housing standards, properties must be decent, safe, sanitary, and in good repair.

However, public records provided by Hialeah reveal that at least 7 of the 14 affordable properties have incurred city code and HUD violations, presenting conditions that pose risks to the safety of residents. These violations include:

▪ Fire exit signage damaged

▪ Expired elevator inspections

▪ Expired elevator inspection certificate

▪ Shopping cart obstructions in hallways, leading to multiple incidents

▪ Shopping cart obstructions in stairwells

▪ Illegal dumping

In one building, Villa Esperanza, which is part of HOME program, tenants reported to city inspectors that a person was living in the laundry room.

These violations are part of the reason Mayor Bovo’s administration wants to transfer control of the city’s properties to HHA.

“With HHA, a robust service that the city cannot provide through subsidies will come; we will have a much more robust city administration,” explained Rubi before the council.

READ MORE: Hialeah turns to developers, attorneys to help tackle its affordable housing crisis