On Tuesday, the Holly Ridge town council voted to extend the deadline for Holly Plaza's lease buyouts. Former residents of the public housing complex, which Holly Ridge condemned due to mold issues, now have until noon on December 29 to decide.
Holly Ridge announced lease buyouts during an emergency meeting on November 27. These agreements, which vary based on apartment size and time left on the lease, initially came with the condition that Holly Plaza residents refrain from suing the town of Holly Ridge.
But on December 5, residents were informed of another caveat. Last week, the federal housing agency HUD notified tenants that accepting the buyouts could make them ineligible for long-term federal rental assistance. The letter also stated that those accepting the buyouts would no longer be subject to HUD tenant protections.
Brianna Paull, who is the lead plaintiff in the class action suit filed against Holly Ridge, spoke during the meeting's public comment period.
"This HUD letter was received on December 5, weeks after the town already started thrusting these agreements on us," she said.
Town manager Heather Reynolds offered some clarification on the letters.
"HUD was notified immediately when all this transpired back in September, October timeframe," she said. "So it's very disheartening that now on Dec. 5 they've decided to reach out to the tenants, after having known about this for close to two months."
A HUD spokesperson told WHQR via email that HUD was first made aware of mold issues on October 30, 2023.
Reynolds also said during the meeting that the letter's language about tenant rights and assistance was misleading. She said that town attorney Sam Potter met with a HUD attorney on Monday to clarify the language.
"[HUD] explained that the assistance that they intended to reference in the letter was the Holly Plaza housing. Sam informed them again that there will be no Holly Plaza housing. So that benefit is not relevant," Reynolds said.
Reynolds said that town officials are attempting to schedule a meeting with HUD to clarify the terms set forth in the letter. She alleged that they have not yet heard back on a date.
"[HUD has] had all of your contact information this whole time," Reynolds said. "So that's the frustration that the town is dealing with on the fed's side."
Holly Ridge is extending the buyout deadline in order to get clarification from HUD. Tenants still have until December 31 to find new housing.
On December 13, the USDA informed an attorney representing former Holly Plaza tenants that the agency would be providing 12 months of rent vouchers for every household. Tenants can use these vouchers to cover a substantial portion of their rent at HUD-certified and non HUD-certified apartments.
"It's the average market value rent for their specific unit subtracted by the amount that they were contributing to the rent at Holly Plaza. They will be paying the exact same amount," Miller told WHQR.
Related: USDA to offer 12 months of rent vouchers to all Holly Plaza households
These vouchers will allow tenants to have housing for the next twelve months. It's available to all tenants, including those who sign lease buyouts with Holly Ridge.
During the meeting, the town also swore in three new town council members: Phil Misciagno, Joshua Patti, and Aaron Ritter. The town council elected Joshua Patti to the position of mayor pro tem.
A HUD spokesperson issued the following statement:
HUD’s main concern is the health and well-being of the Holly Plaza residents. The project receives project-based rental subsidies under a Section 8 Housing Assistance Payments (HAP) Contract. The Town of Holly Ridge renewed the HAP Contract on November 4, 2021. The HAP Contract is in effect until November 30, 2041. The mortgage is financed through the United States Department of Agriculture (USDA), Rural Development Division.
On October 17, 2023, HUD received a Congressional inquiry regarding constituent correspondence that the residents of Holly Plaza were being displaced by the Town of Holly Ridge. On October 30, 2023, HUD received additional information that the Town had vacated the residents from Holly Plaza.
After discussions with the Town and USDA, HUD issued a notice on December 6, 2023, informing residents that accepting a lease buyout offer from the Town may impact their rental assistance from HUD.
On December 14, 2023, the Town’s attorney requested a meeting with HUD to discuss the notice. The meeting is expected to take place the week of December 18, 2023.