The Bluegrass Area Development District is selling its Trent Boulevard property to a nonprofit Ohio company that plans to create more than 50 housing units for limited-income seniors.
The development district, which helps coordinate regional planning and federal spending among local governments in a 17-county area of Central Kentucky, will receive about $800,000 in the sale, a district official said Tuesday.
Meanwhile, Episcopal Retirement Homes Inc. of Cincinnati plans to invest about $8.75 million in the property, with much of the money coming from state and federal affordable housing tax credits.
The sale ends a long saga over the future of 1393 Trent Boulevard, which began two years ago when the River Park Neighborhood Association objected to the development district's plan to turn the former campus of a residential facility for the mentally handicapped into housing for former felons. The acrimony led to a legal battle over the district's spending records; influenced the departure of the district's director, Lenny Stoltz; and sparked an investigation by state Auditor Adam Edelen, which has not been released yet.
The district bought the six-acre property in 2012 for $600,000 from the Episcopal Diocese of Lexington. It then spent $500,000 on upgrades, much of which were done through no-bid contracts.
"This was probably a way to turn lemons into lemonade," said Garrard County Judge-Executive John Wilson, a member of the district's board. "The neighborhood is happy with it, the city of Lexington is happy with it. It would have been nice to completely recoup our losses, but this is a good solution — it allows BGADD to move forward and focus on helping the region move forward."
The Lexington-based district handles tens of millions of dollars annually and is governed by a board made up of mayors and judge-executives.
Charles Payne, president of the River Park Neighborhood Association, said neighbors were "very pleased at the prospect of having Episcopal Retirement Homes, Inc. as our new neighbors and are looking forward to working with them to make this a successful venture."
"I feel they will be an asset to our community and will go a long way to helping us revitalize our neighborhood," Payne said.
Jay Kittenbrink, director of development for Episcopal Homes, said the group — which owns 17 senior residence communities, most of them offering affordable housing — has been wanting to expand into Kentucky.
Lexington architect Tom Fielder of the Fielder Group brought the Trent Boulevard property to the company's attention, and meetings then started with local residents, Kittenbrink said.
"It does need a lot of work, but the bones are very sound," Kittenbrink said of the property, which has several buildings. "It will get new roofs and new exteriors."
He said 40 of the units will have one bedroom and 14 will have two bedrooms. Rental prices, which already are decided because of federal tax-credit rules, will be $535 a month for the one-bedroom units and $635 for the two-bedroom units. The property should be open by spring 2016.
The development district originally had sought $995,000 for the property, but officials later lowered the price.
Originally, Stoltz had planned to use the property for a felony re-entry program, but he refused to discuss details of the project with the neighborhood association and later refused to provide records under the Kentucky Open Records Act.
Attorney General Jack Conway's office ruled that the development district was not authorized to operate the program and was required to share its records.
In July, the district's board gave Stoltz the choice to resign or be fired. His resignation came with a $128,000 severance package and $8,000 in consulting fees because officials said Stoltz was the only person who could operate the district's accounting system.
Shortly afterward, the state auditor started an investigation into the district. Spokeswoman Stephenie Hoelscher said the audit was expected to be released within the next couple of weeks.
View Low income senior housing in a larger map
Linda Blackford: (859) 231-1359. Twitter: @lbblackford.