Last relocation phase begins at sinking NLV subdivision

With the start of phase three of the relocation of the homeowners from sinking Windsor Park, North Las Vegas city officials hope they finally are seeing the light at the end of a three-decade-long nightmarish tunnel.

Mary Reed, who like scores of others in the 241-home subdivision saw the dream of home ownership ruined as the ground sunk underneath her house, was honored today as the first to relocate under the new Windsor Park Housing Revitalization Bond.

The new plan differs from the first two phases in that residents of Windsor Park off Martin Luther King Boulevard and Carey Avenue now can relocate anywhere in North Las Vegas and receive $50,000 to defray the cost of a new home.

The Federal National Mortgage Association -- Fannie Mae -- purchased a $4 million general obligation bond in February that made it possible for the city to relocate homeowners much quicker than originally planned. The city has to repay the money over 10 years.

"Fannie Mae's involvement has expedited the process by 15 years," Lydia Camacho, manager of federal programs for the city of North Las Vegas, said.

"Now we are looking to offer (the assistance) to the remaining homeowners within five years -- maybe quicker. Otherwise, it would have taken 20 years using (Community Development Block Grant) money to make the same offers. This emphasizes the importance of public-private partnership."

Today's ceremony took place at Reed's new home at 2216 Rejoice Drive, near Lake Mead Boulevard and Victor Way. Sen. Richard Bryan, D-Nev., North Las Vegas Mayor Michael Montandon and Charlene Peterson, director of Fannie Mae's Nevada Partnership Office, were to have attended the event.

"Fannie Mae got involved to speed up the process because of the safety factor of the homes in Windsor Park -- they are not going to last another 20 years," Peterson said. "The city first approached us in 1997. Since then we have helped design this assistance program."

Founded in 1938 as an arm of the federal government, Fannie Mae became a publicly held company in 1970. It is the world's largest non-bank financial service company and specializes in assisting low-moderate-middle-income families with buying homes.

There has long been a stipulation to the city's offer that prevents homeowners from using the assistance money to make a quick financial killing. They must stay in their new homes 10 years or pay back the assistance money, or a decreasing portion of it as the years pass.

This was a sore spot with some of the 45 homeowners who agreed to relocate under phase two to Walker Park at Cartier Avenue and Martin Luther King Boulevard.

Many of those homeowners said they deserved a more liberal use of the grant money because their Windsor Park homes became worthless after sinking ground buckled foundations and sidewalks, cracked plumbing and ruptured gas lines.

However, Camacho said, the money was meant as assistance, not as a settlement. Otherwise, homeowners could purchase a house for $100,000 using the $50,000 assistance money as a down payment, then sell it a week later for $100,000 and pocket the city-generated $50,000 as a profit.

Instead, a 10-year lien is placed on a new home, requiring that the assistance money be paid back to the city from the sale proceeds. After 10 years, however, homeowners are free to sell their homes and not repay any of the $50,000 in assistance money.

Reed, using the assistance program money, bought her new home for $102,000, city officials said. She had lived in Windsor Park 30 years.

The first phase began in 1996 when four Windsor Park homes were relocated to Martin Luther King and June Street. But the cost of maintenance was so high, the city abandoned that plan.

For phase two, the city built 45 homes across the street from phase one and provided assistance money to relocate Windsor Park residents there.

Today 82 homeowners and their families still live in Windsor Park. Another 44 families live there as tenants in rehabilitated homes, Camacho said. A number of homes have been abandoned.

Between 10 percent and 15 percent of the Windsor Park residents have declined the city's assistance offer and say they will stay in their damaged and unmarketable homes, Camacho said.

Many of them are older people whose homes are paid for. They have told Camacho they will not be able to find a home that costs $50,000. At their advanced ages they do not want to make mortgage payments on a new home, she said.

The city can offer the assistance to 10 homeowners at a time -- taking those whose homes are in the worst shape first, Camacho said.

A number of those receiving offers, she said, have opted not to immediately sign the agreement instead of outright turning it down or making a 10-year commitment to stay in a new home. Once the offer is turned down, the city will not offer it again, Camacho said.

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