The Rebirth of Real Cooperation

Friday December 04, 2009 | DC Metro

When the Arlandria Chirilagua Housing Cooperative took definitive shape in the early 90s after a 10-year organizational effort, its residents hoped to stomp out the evictions, rent increases and utility hikes plaguing the low-income development on the Northeast fringe of the city. As owners of the 282-unit co-op, the tenants - mostly immigrants - and their elected board of directors would control their own rents and voice effectively their opinions related to their home.

Thirteen years later, the ACHC has seen internal tumult among its members and between them — specifically members of the board. Tenants and Workers United, the activist group that forged the co-op’s existence in the 80s, resigned its advisory support of the co-op in 2006 because the organization was unhappy with its governing body’s “self-serving” actions, one member said this summer.

But out of an antithesis of cooperation came activism and progress for the co-op’s members, having concluded last week what they saw as their first legitimate election in several years.¨

"Despite all the obstacles, many people voted," said Jorge Iglesia, a member of ACHC. "These elections represent change at ACHC."

A popularly elected Board of Directors will be able to restore the cooperative to democratic management and provide affordable housing as it was always meant to."

In 2005, after a Board of Directors election, residents began complaining of the board’s inattention to apartment maintenance, conflicts of interests and, most significantly to residents, evictions and rent and utility increases with no clear reasoning — or paper trail — behind them. 

¨In January 2008, the board informed residents that they would pay 3 percent more in rent and another $95 for water and trash services. Utilities had been included with rent payments until then."

"It didn’t make sense," said resident Donnae Johnson earlier this year. “I’ve been asking for them to fix my rodent problem since 2006 and sometimes I find cockroaches crawling out my sink. Why do I pay more?"

Board member Mesfun Berhane also wanted to know. He was part of a suspicious minority on the board, wary of what he perceived to be opaque dealings among the board’s majority, led by co-op and board member Kathleen Henry.

Budget documents obtained by the Times indicate a fiscal plan vacant of details or a breakdown showing where and why rent and utility hikes occurred “all of a sudden,” as Berhane put it.

"This is written on a napkin," quipped Berhane this summer. "How is this supposed to be legitimate? This is how she runs the co-op; she writes things up and people sign it."

Numerous members of the co-op commenced on a “responsible” rent strike, placing it in an escrow account to be paid when a list of complaints and demands for paperwork were met. It was eventually paid, but at the expense of 91 residents losing their votes in the next election for withholding rent.

Henry would not comment on the cooperative. However, an independent audit of the co-op performed this February by Toal, Griffith, Ayers and Kullman, LLC, states, “In our opinion, the financial statements … present fairly, in all material respects, the financial position of the Arliandria Chirilagua Housing Corporation” for 2007 and 2008 “in conformity with accounting principles generally accepted by the United States of America."

City and state authorities have limited enforcement power over the co-op, which is actually under a corporate umbrella - the Arlandria Chirilagua Housing Corporation.

Berhane and others had taken Henry to court after the 2005 election in which she gained a seat, alleging that it was not publicized to the co-op’s members and therefore illegitimate. The judge’s only ruling was that another election was imminent, “so make sure it is legitimate,” according to Berhane. Legal fees associated with this case could be the reasoning for fee increases, her opponents believe.

But this November, Berhane and other board and co-op members stood up to the board majority and elicited enthusiasm in residents that was previously waning. Berhane said he and his like-minded counterparts are now the majority, having forced out those deemed problematic by his constituents. 

"The people were ready for change," Berhane said. "They knew the election was coming and we told them our program for the future of the co-op, and they saw how hard we were fighting with it."

ACHC’s bylaws provide ample power to the board, which could have led to the current state of affairs: Since 1993, the co-op has borrowed $537,000 to start and sustain its endeavor. The co-op was supposed to demonstrate by July of this year that it was operating solely and successfully, in which case $232,000 of the loan would be forgiven. The city granted an extension on the decision in July, pending an audit of the co-op’s internal procedures. 

“I think we have to give a close examination to everything in this area that we give money away for to make sure it’s being spent wisely, because we have so many needs and so many desires in this area and we only have a limited amount of money,” City Councilman Paul Smedberg said after the recent election. “I think people genuinely want to be supportive, but I think we have to just be certain we’re doing the right thing.”

Berhane hopes the current board can settle the dust and continue with a self-sustaining cooperative. But current board members “have no idea at all” how much money they have, according to Berhane, because of what he sees as a sketchy paper trail.

"First we want to make a total study of exactly where the co-op stands in terms of its finances, resources, accounts and so on, and what capacity it has," he said Wednesday.

"We want to have a democratic co-op controlled by its members that invites participation of all its members," including his opponents, Berhane said. "We’d like their opinions. We have no personal grudge against them. This is a matter of policy and direction of the co-op."

The City Council will hear the staff’s analysis of the co-op Tuesday night at its legislative meeting.