A contingent of Gainesville residents drove to Austin Monday to argue for and against a proposed 144-unit apartment complex in northeast Gainesville.

A board of the Texas Department of Housing and Community Affairs ruled to allow the project, Bella Vista Apartments, and said it had community support from within the city.

“This is going to be a great day for Gainesville because (this property) is finally going to be a beautiful housing development for 144 people,” said Dr. Les Schachar, a local opthamologist and the owner of the proposed site of the development. “There’s absolutely no negatives for the city.”

Opponents who traveled to Austin said they are outraged.

“To say that I am disappointed is an understatement!” said Lisa Bellows, president of the Gainesville ISD Board of Trustees.

Beverly Snuggs, Gainesville city councilmember for ward 1, said each person was given “a mere three minutes” to speak.

Schachar said the land “has brought no tax benefits to the city for many years” and “I do not understand the opposition to this project.”

Bella Vista would pay 50 percent of the taxes normally owed by an apartment due to Monday’s approval by the Texas Department of Housing and Community Affairs.

Schachar stated at a March 22 Gainesville City Council meeting the apartments could net $12 to 13 million in tax revenue. He said he had plans to use remaining land he owns near the development to build several places of business, which could, in turn, generate more tax revenue for the city.

There would be a 17-year obligation for the apartments to stay on the property, so it would not be a “fly by night” operation, he said at the meeting.

Schachar did not comment on how much he was paid for the property but said it was a “minuscule amount.”

The rent for the apartments would range from $606 to $840 depending on number of bedrooms or other amenities. Though not a “section eight” development, the rent owed by a tenant would be flexible, depending on the person’s annual income.

Schachar, who joined up with a group calling itself United Housing Foundation of Gainesville, L.P., advocated the development.

“I didn’t go to anybody. They came to me, because it’s such great land — behind Wal-Mart,” Schachar said. “I just wanted to sell my land!”

He said the apartments will be by no means “shabby.” He said the gated, controlled-access units would have vaulted ceilings and the complex would feature a computer lab, exercise area and other “state-of-the-art” amenities.

“If it’s good enough for Plano, it’s good enough for Gainesville,” he said, noting similar developments in the Metroplex.

One of the qualifications of living there would be steady employment, he said.

Bellows, who attended the Austin meeting with Snuggs and Jerry Henderson, director of the Gainesville Housing Authority, said she disagrees strongly with the Austin board’s decision.

“We were told in Austin that there just was not enough community input to make their board vote against the staff recommendation for this project and every elected board in our area had clearly expressed that we could not afford this project,” Bellows said.

Bellows said advocates of the apartment development stood outside the Gainesville Wal-Mart Supercenter and gathered 287 signatures for a petition in previous months.

Snuggs said a public hearing was held at Robert E. Lee Intermediate School, up the hill from the proposed site, to gage public opinion. Snuggs added 30 people attended and the person moderating the forum rushed meeting as she had a flight to catch at Love Field that evening.

“In my short 3 minutes (at the Austin meeting), I tried to tell them that Gainesville could not afford to have a $12 million dollar projection built on 13.5 prime acres be on the property tax rolls for next to nothing,” Snuggs said.

She said since the apartments would be taxed at 50 percent of its income, the apartments projected income at maximum occupancy would be about $1.2 million per year, with half of it being $600,000. At $0.673 per $100 valuation, that multiplies out to $4,038 per year to the city, Snuggs said.

“The amount for the value of the property at $12 million would be $80,760. You do the math ... it is over a $75,000 loss each year for the city,” she said. “The board did not believe the figures that I presented, because later the representatives of Bella Vista and Mr. Schacher gave them entirely different numbers.”

Snuggs said Schachar accused her of having a conflict of interest, as Snuggs owns rental property in Gainesville.

Doug Smithson, chief appraiser of the Cooke County Appraisal District, said the 22.53 acre tract Schachar owns has brought in about $38 per year (with a $1,554 taxable value) while zoned for agricultural use.

“If the property is to change use, then there would have to be a rollback on it for the five of the previous years based on the difference of the commercial compared to agricultural,” Smithson said, noting more taxes would be owed.

After the apartments are built on the 13.5 acres sold to United Housing Foundation, Smithson said, part of the taxable value would be based on the income the apartments generate.

“... Based on the assumptions of their income, then it would have an $8.2 million value, and would be taxed at 50 percent at that and would generate approximately $122,000 for all taxing entities.”

Smithson projected the apartments would generate about $26,000 annually for the city of Gainesville. Gainesville ISD would receive $63,800 anually.

After debates on the sometimes varying numbers, on Feb. 21, and March 1, 2005, the Gainesville City Council voted unanimously to deny United Housing Foundation permission to apply to the Texas Department of Housing and Community Affairs for tax exempt mortgage revenue bonds and housing tax credits.

Each of the other taxing entities, including Cooke County, North Central Texas College, North Texas Medical Center and Gainesville ISD, voted to deny permission. The Gainesville Housing Authority also voted to recommend denial and sent a letter to the board.

Bellows said she was concerned for the taxpayers of the GISD.

“I informed the Austin folks that we had recently approved a bond for $29.5 million and that our tax payers were stretched to the limit,” she said. “The developments and properties that we have need to pay the full assessed value for us to be able to provide a quality education and projects like these would truly be at the expense of our children and their future. I asked then I said, no I beg you, to deny this project that lines the pockets of a few at the expense of our children and our community.

“You know, it is amazing that our ‘Big Daddy’ government — state and national — have the controlling power over us locally to permit a group of developers and a single property owner, none of whom reside in our school district, to gain financially by building 144 units behind Wal-Mart after every taxing entity in our area unanimously voted to deny this project,” Bellows said.

She said since the apartments have a large tax exemption there will be insufficient revenue to compensate for an increase in the number of students entering the school district from living in the apartments.

“I have no idea why they were so viscerally opposed to this,” Schachar said, noting benefits of the apartments. “I didn’t want to alienate myself to the community. I want to benefit the community. Why would I want to sell my land that would denigrate the other portion of my land? It doesn’t make any sense.”

Schachar continued: “If there was any way this could have hurt the city of Gainesville, there’s no way on God’s green earth I would have sold that land.”

Schachar said if in the event the apartment project fails, the property would be available cheaply and could be used by other apartment managers to turn a profit.

“I just hope that the citizens of our area know how hard we tried to stop this tax free project from being placed in our community,” Bellows said.

Snuggs said she and city staff are researching avenues by which to appeal the Austin board’s decision.

“I do not think Gainesville was fairly considered in this matter. Again, all taxing entities in the county voted against this project, each one giving it proper consideration and voting unanimously,” she said. “It was not taken into consideration that we are all elected officials that serve the entire population of the county, not just 287 people hurriedly signing a piece of paper thrust at them in front of Wal-Mart.”

Schachar said the Austin board reached a reasonable conclusion.

“The powers of reason have gone above emotion,” Schachar said. “At the end of the day, reason has to win out.”

Reporter Andy Hogue may be contacted at andyhoguegdr@ntin.net