Aim Low

The nation's biggest player in the apartment rental business has found huge profits in low-income housing

By 2002 the San Francisco City Attorney's Office was blitzing AIMCO with legal briefs accusing the firm of flouting the "state and local laws applicable to residential housing"; the city's legal complaint, which chronicles the history of code violations at the properties, runs 111 pages. The courtroom drama ended in 2004 with AIMCO agreeing to pay the city $2 million, pour another $1 million into renovating a nearby Boys and Girls Club, and perform extensive repairs at its Hunters Point apartments.

At AIMCO, Cynthia Eichner clearly doesn't want to discuss the corporation's track record in San Francisco. "Why do you want to write about this?" demands Eichner, the vice president for communications, when asked about AIMCO's regulatory troubles. "What's your point? You just want to trash us." She continues, "These cases are sort of old. These issues are not uncommon" among large-scale property-owners.

Today the repairs are finally underway, funded by more than $82 million in tax-exempt construction bonds handed out by the California Statewide Communities Development Authority. Peterson, though, still isn't happy. She doesn't trust AIMCO, which has a history of selling off its low-income properties, and claims the corporation has hired a construction firm from out of state to do the rehab work. "The bond money," she argues, "is welfare for the rich."

Tenant organizer Sara Shortt, an expert on low-income housing, also isn't a huge fan of AIMCO, although her critique isn't as scathing as that of Peterson. "We need to bring private interests into the role of providing affordable housing," says Shortt, who works for the Housing Rights Committee of San Francisco, and is charting a steady decrease of federal dollars flowing into inexpensive housing. "This type of subsidized housing could work" with stronger government oversight, day in and day out.

Peterson's friend, Espanola Jackson, a longtime neighborhood activist, is more blunt: "Why should we support some suckers the city just sued for $3 million? Why should we do anything for them?"

Certainly, AIMCO's reliance on taxpayer funds is somewhat ironic, considering CEO Considine has a penchant for bankrolling conservative political candidates who detest government spending, people like Michigan Rep. Tim Walberg (who "believes the federal government is too large," according to his campaign Web site), Colorado Rep. Marilyn Musgrave (who says "government bureaucrats cannot control their thirst for gratuitous spending"), and former Pennsylvania Sen. Rick Santorum, according to campaign finance records.

A former Colorado state senator who campaigned for U.S. Senate in the 1980s, Considine also sits on the board of the Lynde and Harry Bradley Foundation, a well-endowed, paleo-conservative think tank based in Milwaukee, Wis., which isn't particularly big on federal programs for the poor.

Michael Kane, head of the Boston-based National Alliance of HUD Tenants, has been following AIMCO for years, and wonders "if Considine's cynical, or if he somehow reconciles" his politics with his feed-at-the-trough business approach.

"There's a whole industry that's grown up around building this type of housing," says Kane. "It's a very profitable field. For one thing, these are secure investments — there's a guaranteed source of income in the form of government dollars."

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