$3M loan sought for Schenectady buildings

City would demolish 60, put up $1.3M for DSS renovation plan

Tuesday, June 11, 2013
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The former county DSS building on Nott Street in Schenectady has been proposed for renovation into an apartment building, built by Galesi Group and funded partly by a federal loan.
The former county DSS building on Nott Street in Schenectady has been proposed for renovation into an apartment building, built by Galesi Group and funded partly by a federal loan.

— The city wants to borrow $3 million from the federal government to demolish 60 blighted buildings and renovate the former Schenectady County Department of Social Services building on Nott Street.

The Galesi Group would turn the former DSS building into an apartment building. Including the city’s contribution of $1.3 million, the project would cost $2.8 million for 14 units. That’s $202,000 per apartment.

But it would restore a blighted building, city officials argued in their loan application.

They said the project is a “key neighborhood anchor” and would help jump start a new Walk To Work initiative in the neighborhood, which has three big employers: Union College, Golub Corp. and Ellis Hospital. Both Ellis and Union also have limited parking, which could be somewhat relieved if more employees walked to work.

The building is near Union and Golub, but is three-quarters of a mile from Ellis.

The city is proposing to borrow $1.3 million for the project, with the Galesi Group providing the rest.

Gerald Hennigan of the Galesi Group wrote a letter in the application explaining that the project would be more than just an apartment building.

“We feel the 487 Nott St. project will have a larger community impact based on its location in an area of greater economic distress including deteriorated housing stock,” he wrote.

The City Council will hold a public hearing on the expense at 7 p.m. Monday, June 24, in City Hall. That hearing also will discuss the loan to demolish houses throughout the city.

City officials have proposed to demolish 80 houses, out of 124 properties in the city that were deemed beyond salvaging. All of them are vacant and have been for quite some time.

The trouble is that the city only owns 55 of those houses. Most were taken through foreclosure.

Building Inspector Eric Shilling said the owners of the other houses should pay for their houses to be demolished.

“It’s my opinion the owners should be completely responsible for the cost of demolition,” he said.

The city’s Law Department is sending letters to owners now to urge them to pay up. Those who are convinced could demolish quickly, Shilling said. They must first prove National Grid has cut off electricity and gas and remove any hazardous materials.

But even if they started from scratch, Shilling said, owners could easily be ready to demolish within a month.

Convincing them might not be easy. Fred Lee, who owns one of the houses on the demolition list, said he can’t afford to demolish the house he and his wife bought as a potential rental.

They bought 806 Sprague St. on the theory they could fix it up themselves and rent it out. They said they saw it as a way of improving their neighborhood, not to make money.

“We bought it with great optimism,” said Lee, a longtime neighborhood organizer.

Then a tree fell on it from a neighboring property. It left a hole in the roof the Lees’ insurance wouldn’t cover — they only had construction insurance on the house. The homeowner who owned the tree wouldn’t, or couldn’t, pay for the damage through his insurance, and so the hole remained in the roof.

“The house deteriorated,” Lee said.

Desperate, they even tried to give the house away. No one would bite, not even Habitat for Humanity.

“Our heart was in the right place,” Lee said of the initial renovation plan.

Now, he said, the city should pay to take it down.

“It needs to be demolished. I want to say we’ve given up. We’re just tapped out. There just comes a point where you just have to say there’s no more you can do,” Lee said.

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June 12, 2013
7:56 a.m.
gina99 says...

More borrowing? No wonder Moody's and the State Comptroller both issued warnings. McCarthy and his rubber stamps burned through the surplus and cannot make more than minimum payments on existing bonds. Federal Block Grants should be used to remove these eyesores that are in every neighborhood in the City because of confiscatory Democratic taxation.

June 12, 2013
10:05 a.m.
hodgkins.t says...

The City wants to borrow money to give to a private developer ? A gift of 46% of the project cost?

June 12, 2013
11:28 a.m.

hodgkins.t, What happened to your preschool mission. Reads like you're already 'aspiring' to other windmills.

June 12, 2013
4:47 p.m.
justapto says...

There is a surplus of rental units in Schenectady. Now the city wants to compete with the existing housing stock by adding more units.
Take funds from other tax payers and give them to Galesi Group, (an out of town developer). The Mayor and city council should join the Malta Library group; resign en mass!

June 13, 2013
12:09 p.m.
mkuban says...

If Galesi wants to develop the property fine but it should be on their dime not Schenectady's taxpayers. I suppose they will want or get a tax incentive too. Mayor McCarthy needs to put the taxpayers first and not some out of town developer.

When a developer or business wants to do something in the city the first thing the Mayor or Metroplex does is throw money and tax incentives at them. When an individual wants to purchase a city owned home to live in and acks for a break on taxes to make repairs and renovations more affordable the common council tells them it is illegal to do so.... WTF why pay $88K for a house that needs work when you will be paying taxes on $147K assessment. Wonder how long it is going to take the new golf pro to grieve his taxes.

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