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Housing Authority Breaks Ground on $5 Million Renovation

Cole Crest Rehab is Largest Rehab of Its Kind in Dauphin County;
Work at Other Sites Can Proceed Due to Innovative Financing

STEELTON, PA, May 2, 2005 — The Housing Authority of the County of Dauphin (HACD) has broken ground on the largest rehabilitation project in its history.

At a ceremony at Cole Crest Apartments in
the borough of Steelton, Mid Penn Bank and the Federal Home Loan Bank of Pittsburgh (FHLBank) presented a check for $4.4 million to help finance the $5.1 million, two-year renovation project. HACD will fund the rest of its work at the 100-unit complex for low-income families, elderly and disabled individuals through the annual Capital Grant Program of the U.S. Department of Housing and Urban Development (HUD).

Extensive interior and exterior work at the 39-year-old complex just minutes from downtown Harrisburg will touch virtually every facet of living conditions for its residents. Renovation will be accomplished in five phases, each consisting of 20 apartments. Affected tenants will be relocated to other vacant apartments until remodeling of their own units is completed. HACD will pay for tenant relocation.

Today's event was attended by State Sen. Jeffrey E. Piccola (R-15); Charles D. Gassert, HACD executive director; Alan W. Dakey, president and CEO of Mid Penn Bank; John Bendel, director of Community Investment for the Federal Home Loan Bank of Pittsburgh (FHLBank); and several county commissioners and borough officials.

Speaking at today's ceremony, Gassert said it would have been extremely difficult to begin work at Cole Crest without the innovative financing package put forth by Mid Penn Bank and the FHLBank. The FHLBank is a wholesale bank that provides its members with a reliable supply of low-cost credit for affordable housing and other community development needs.

"We are able to complete this project in just two years due to the low-cost funding provided by Mid Penn Bank and the FHLBank and HUD's approval of our plan to use some capital funds to service the debt," Gassert explained. "Extending this project over a longer time period using traditional bond financing would have driven up costs, consumed extra dollars and forced us to place on hold various improvements at the other housing sites we manage. In an environment of limited public funding, these two banks presented us with a very attractive solution to multiple needs."

"Our release of more than $4 million in Community Lending Program funds represents one of the largest disbursements from our Bank for a single project," said Bendel of the FHLBank.

"Working with the FHLBank, we provided a solution that helped avoid higher-priced bond financing while offering low closing costs," added Dakey of Mid Penn. "Our support of much-needed renovations at Cole Crest is part of our growing commitment to businesses and nonprofits across central Pennsylvania."

Comprehensive changes

Improvements to building exteriors at Cole Crest will make the complex look less like rowhouses and more like townhomes. Exterior work includes siding, roofs, gutters and downspouts, retaining walls, painting, sidewalks and curbing, site lighting, additional parking, patios and landscaping.

Interior work will encompass the demolition and renovation of kitchens and bathrooms, new electrical wiring, duct work, telephone and cable lines. HACD has also entered into an energy performance contract with Honeywell International for the installation of new energy-efficient water heaters, furnaces, central air conditioning, lighting and refrigerators. A larger laundry will also be built to accommodate tenants with disabilities.

Head Start and a career skills program, P.R.O.B.E. (Potential Reentry Opportunities in Business & Education), are housed in the administrative office at Cole Crest but will be unaffected by the renovations. Penncrest of Lancaster, PA, is the general contractor.

"A genuine commitment to public and private partnership surrounded this entire project," remarked Sen. Piccola. "At a time when every dollar counts, HACD engaged in out-of-the-box thinking for the good of its clients, Mid Penn Bank displayed real public spirit, and the FHLBank of Pittsburgh again proved the value of its mission. Each is to be commended for going the extra mile."

HACD owns and operates approximately 750 conventional, HUD-subsidized public housing units at 16 sites in Dauphin County. HACD also administers the Section 8 federal housing program, making it possible for low-income individuals and families to live in private rental housing. In addition, the Authority offers a program to assist qualified
low-income residents in becoming homeowners. HUD has rated the Dauphin County housing agency as a "high performer" in its most recent local agency evaluations.

Mid Penn Bank is a $396 million bank with a new regional headquarters at 5500 Allentown Boulevard. A community bank founded in 1868, it currently operates eleven banking offices and plans on opening a twelfth branch at Market Square Plaza in downtown Harrisburg this June. Mid Penn Bank is also one of four area banks participating in HACD's Family Savings Account Program, which encourages lower-income families to save money and achieve financial self-sufficiency through regular deposits that are matched by the commonwealth of Pennsylvania.

Mid Penn Bank is a member of the FHLBank of Pittsburgh. With $61 billion in assets, the FHLBank serves nearly 340 member institutions in Delaware, Pennsylvania and West Virginia. It is one of twelve FHLBanks, all private cooperatively owned banks that provide wholesale housing finance, community lending and correspondent banking services.