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WyoTech housing? 'Not in my neighborhood'

Jeff Himler
| Friday, May 11, 2012, 1:20 a.m.

BLAIRSVILLE--Borough Council Wednesday took the next step toward approving a student housing complex along Grandview Avenue, although several residents and at least one council member expressed reservations about the $27 million project.

Close to 100 citizens filled the WyoTech cafeteria to hear Ambling West of Anaheim, Calif. state its proposal for 16 housing units to accommodate 637 students of the local automotive school.

According to Conrad Sick, senior vice president of Ambling West, the apartment units would look like "a three-story manor house" and would be built on 12 acres to be leased from the borough at the site of the closed swimming pool. Nineteen audience members responded with questions and comments--including concerns that the housing project would add to loud disturbances, speeding and vandalism which many town residents attribute to WyoTech students.

Several also expressed skepticism about the housing development's projected return to the borough of $42 million over 40 years.

Sick explained the money would be returned to the borough through annual residual cash flow payments, resulting from the firm's plan for financing and operating the complex.

According to Sick and Borough Solicitor Matt Kovacik, the borough would not be assuming indebtedness or guaranteeing loans for the project.

But the borough would have to form a tax-exempt economic development authority, which would lease the ground from the borough for a minimum of 35 years and also would own the housing units. The authority would obtain financing through a 32-year bond issue, secured by a letter of credit Ambling intends to obtain from a bank and by a guarantee from WyoTech that it will pay for any shortfall in funds if student occupancy doesn't meet expectations.

Ambling would construct the housing units and manage the facility under a two-year renewable contract with the economic development authority. Built into the project's budget will be profits for Ambling--a developer fee in the neighborhood of $800,000 and a management fee of up to five percent of gross receipts.

Sick said the project's ownership/financing arrangement will help keep monthly rent reasonable for the two-bathroom student apartments. Each averaging 964 square feet, about half of the 169 apartments will feature four single-occupancy bedrooms and the other half two double-occupancy bedrooms.

According to Sick, beginning monthly rent levels, including all utilities, are projected at $330 to $350 for double-occupancy rooms, $380 to $410 for single occupancy.

As those rents increase over the years, following the consumer price index, there also would be an increase in the projected residual cash flow to the borough--remaining after operating and debt service expenses have been met.

According to Sick, the annual cash flow return to the borough is expected to increase from $106,000 in the first year of occupancy to $250,000 in the 10th year, $800,000 in 20 years and $1.6 million in 30 years. He admitted the real return to borough taxpayers over 40 years would total about $31.5 million if the borough honors a proposal provision, setting aside one-third of the cash to fund scholarships for WyoTech students.

Overseeing the apartments would be a five-member governing board, including two borough officials, a community member and one representative each from WyoTech and from the property management staff.

At the end of the nearly three-hour meeting Wednesday, council voted 5-1 to have Kovacik and a Pittsburgh bond counsel further investigate the student housing proposal.

Kovacik noted many issues still need to be determined--including how the economic development authority and governing board would be formed, whether the site's zoning would need to be amended and whether Ambling can obtain the letter of credit needed for the financing.

Sick said council's Wednesday vote was the "notice to proceed" his firm was hoping for this month, so it can continue developing plans for the site and arranging financing.

If those plans become a reality, he said, Ambling anticipates closing on project financing by next April, breaking ground in May and being ready for occupants by July 2005.

"We're really looking to work with everybody in the borough," Sick said.

Councilman Ron Evanko was opposed to the motion to proceed. Paul Masula cast a favorable vote but expressed reservations.

Masula, who resides on South Stewart Street, echoed complaints from other residents: windows broken out of buildings and, when classes let out, students racing their vehicles down side streets and ignoring stop signs.

"It does look like the Daytona 500," said Masula, who indicated about 85 students are rooming in his neighborhood.

But Masula acknowledged all traffic and mischief complaints in town can't be traced back to WyoTech students.

Police Chief Don Hess concurred. In response to complaints about speeding and traffic violations on intersecting East Brown Street, he said three police cars set up surveillance of the location one evening earlier this week.

"We made many stops and they were cited," he said. He noted one of the motorists charged, after a lengthy chase, was a 17-year-old borough resident.

"Word has gotten out" about the traffic crackdown, he said. "You will have results, but it's not going to happen overnight."

Guy Warpness, president of WyoTech's Blairsville area campus, expressed understanding for residents with complaints about his students' afterschool misdeeds.

But he noted he has no power to control the activities of those who rent from private landlords in Blairsville.

He said the proposed Grandview Avenue complex is an attempt to minimize complaints by concentrating student housing on the outskirts of town in a facility that would have management staff on site 24 hours a day.

At the Grandview location, Sick noted, students would have less than two miles to travel to the new Wyotech campus east of town, at the Corporate Campus industrial park in Burrell Township. Also, they would not have to drive through downtown Blairsville.

The main entrance to the housing complex would be next to a car wash on old Rt. 22 in Burrell Township.

Warpness noted WyoTech is negotiating with Indigo, the county transit authority, to provide bus passes for its students--with routes that might also be used by Blairsville seniors to get between downtown and destinations along the Rt. 22 corridor.

Sick said Ambling's on-site staff would include a community director who will focus on physical property issues and an assistant who will be concerned with "lifestyle management"--intervening in disputes between students while "assuring rules and regulations of the project and of WyoTech are followed."

Each of the 16 units will have a student designated as a community assistant, to provide oversight of student conduct in that building and to organize social activities for the occupants.

While adjacent tennis courts and other borough recreational facilities will be available for students, Sick noted the housing complex will offer its own activities: cable and Internet access and a 3,500-square-foot community building featuring game and exercise rooms and a kitchen where local vendors will be able to serve meals.

Several residents renewed a request made two weeks ago, that ultimate approval of the housing proposal be decided by a town-wide vote.

"We'll have to look into that," Council President Andy Baker replied, though he also told the residents, "You elected us (council members) to represent the community in the best way...No matter what we do, it will not be 100 percent popular."

Kovacik pointed out the deadline has passed for handling such a vote as a formal referendum on this November's general election ballot.

"The town does not want student housing in the borough," asserted Gene Pellegrene, who recently presented council with a petition to that effect, signed by about 200 residents.

Several other residents said they want the student housing complex in Burrell Township, closer to the WyoTech campus.

Greg Persichetti, a member of the Blairsville Rec Board and a resident of McArthur Street, said, "The (proposed) facility is beautiful. No doubt, the school needs it." But, "We don't want it up on the hill. This needs to be closer to the school."

In addition to concerns about student conduct, some residents who live near the Grandview site feared their property values would decrease.

Darlene Shaffer of North Brady Street argued there's more danger of that happening to homeowners if individual landlords continue to develop student housing in scattered residential areas. She cited insufficient parking as a related problem.

"The school's not going to go away," she said. "Do we put up with this around town, where there is no safety and no controls, or do we allow them to put in a beautiful facility where it's supervised."

Warpness said other sites in the Blairsville area were considered for the housing project, but construction costs were too high, due to steep grades or other factors.

He noted residential structures cannot be placed at the industrial park.

Councilman Scott Cavender said the growing number of WyoTech students in the community will require an increase in borough services, regardless of where housing is located.

He argued it would be preferable for the borough "if they're living in town and contributing to the cost of services."

He said the borough already is in need of two additional full-time police officers, which will add about $90,000 to the budget.

Compared to the impressive cash flow expected from the housing project, he noted one mill of borough property tax generates about $16,000 annually.

Scott Delcoco pointed out traffic is congested along Grandview during Friday night football games at the adjacent high school field, located across the street from the targeted housing site.

Sick said Ambling would coordinate parking with the school district. He said about 25 parking spaces would be added at the site, noting demand on parking should ease on weekends, when a third of students typically return to their hometowns.

Kristi Eckenroad of Campbell Street said she also is annoyed by some of the noise generated by students and their vehicles.

But she argued it's part of the "growing pains" Blairsville will have to cope with if it wants to enjoy the economic growth fueled by WyoTech.

She cited one specific benefit of that growth: a local father of three who had been out of work for more than a year before gaining a job at the automotive school.

Instead of resisting change, she suggested concerned residents get involved in a crime watch program being organized by Blairsville police.

Responding to other comments, Sick said a geological study completed by his firm indicated undermining of the Grandview site, though a factor in closing the pool, is not an obstacle to developing housing units there.

An engineer with the Blairsville Municipal Authority indicated the authority systems have sufficient capacity to handle water and sewage needs for the proposed student apartments.

Ambling West was hired last April by WyoTech's parent organization, Corinthian Colleges, to assist with developing student housing at the automotive school's Blairsville and Laramie campuses.

Sick noted the proposed Grandview housing would accommodate only about 64 percent of the 1,000 students expected to be enrolled at the Blairsville campus by 2005.

He said Ambling will begin making general plans for two further potential housing facilities for WyoTech. But he noted it's too early to pinpoint their size or location.

Laura Ramsden of Derry Township argued that the rental fees cited by Ambling still are over-priced for many WyoTech students.

She represents the owner of the former Burrell Elementary School, which is being converted to student housing. She said 24 students currently reside there and 130 more are to move in by the end of the year.

Warpness reported some students currently are paying as high as $500 per month for housing in the Blairsville area.

"We lost a lot of good students who couldn't afford (rent)," he said. "They simply had to go home."

Others have had to go to Indiana to find affordable student housing.

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