Renters Ready to Cash In on Dream of Ownership : Housing: Tenants of federally subsidized apartments in Lincoln Heights try to buy buildings. They would be first in county to take control of such a complex.

Sixteen years ago, when the tenants of Mission Plaza Apartments launched a rent strike to improve conditions in their complex, they pooled $150,000 for an apartment dweller’s pipe dream--the chance to own the buildings.

“We put out the money in a little suitcase,” said Theodora Rolette, who has lived in the 132-unit apartment complex for 21 years and led the 1976 strike. “We were going to buy the building with our own rent money. But they pulled a fast one on us and declared bankruptcy.”

Despite their setback, the occupants’ vision was a dream deferred, not denied.

Today, Mission Plaza’s mostly Latino and working-class renters are just months away from becoming owners of the $6-million privately owned units in Lincoln Heights--hoping to become the first group of tenants in Los Angeles County to take control of a federally subsidized housing complex.

Built with grants from the federal Department of Housing and Urban Development in the late 1960s, Mission Plaza is eligible for tenant ownership under federal legislation that preserves affordable housing units built privately with government aid. The law encourages tenants to purchase such buildings and offers private owners incentives to sell.

“When I saw (news of the legislation) in the paper, I said: ‘Hell, we’re going to buy Mission Plaza,’ ” said Rolette, who is co-executive director of the tenants association. “I ran down to the public library and got the federal regs. Then I called a meeting of the tenants association and I told them: ‘Hey, we got to do this.’ ”

Stuart Levine, who represents the limited partnership that owns the property, says he is ready to sell because the federal law allows him to unload the apartment at nearly its appraised value.

“The purchase agreement is very close to being signed,” said Levine, who added that “it could take anywhere from six months to a year for HUD to approve the whole transaction.”

The tenants association is trying to collect enough money to buy the property. It is seeking about $4 million in HUD-insured loans and an additional $1.5 million from the city of Los Angeles. The tenants will hold equity in the building--similar to owning shares in a corporation--or they will control a nonprofit corporation that will own the property.

Under HUD regulations, rents will have to remain affordable, although for some tenants, they will increase. The rents will be equal to about 30% of the tenants’ gross household income.

And renters who receive direct federal housing subsidies--the majority of Mission Plaza’s tenants--will benefit because their aid will not be affected by the proposed deal, said David Etezadi, an attorney with the Legal Aid Foundation of Los Angeles.

More than 10,000 federally subsidized housing units in Los Angeles are eligible for tenant ownership. In at least 1,000 units, owners have indicated an interest in selling.

“This is the first wave of what is going to be many more tenant purchases of these sorts of projects,” said Sue Reynolds of the California Housing Partnership Corp., a group also assisting the Mission Plaza tenants. “At least six to eight have been done already (nationwide).”

HUD Secretary Jack Kemp has made tenant ownership of public housing projects a key element of the Bush Administration’s federal housing policy. Affordable housing advocates have long criticized the proposal as a way for the government to dump its housing responsibilities on the poor.

But others say those criticisms do not apply to Mission Plaza and other privately owned apartment units that could become tenant-owned.

“This is not a privatization of public buildings,” said Steve Cancian, an organizer with the Coalition for Economic Survival, an activist group that works with tenants in other HUD-subsidized buildings. “It’s tenants working together to keep housing affordable.”

He added that tenant groups, including the Countywide Alliance of HUD Tenants, “pushed Congress for a law that would preserve affordable housing and allow tenants to buy.”

Despite their fears of becoming responsible for such a large building, many Mission Plaza residents find tenant ownership appealing because of that same sense of responsibility--the opportunity to take control of their neighborhood and clean it up, they say, so their children can play in the streets.

Some residents say they live in fear of gang violence in the apartments, and there are plans, one tenant leader says, to “get rid of the bad guys.”

“There are some families who are just destroying the place,” said Esperanza Favela, a seven-year tenant of Mission Plaza and a new board member of the tenants association. “I think when we own it, we can make Mission Plaza a better place, not only for ourselves and our kids, but for everybody.”

Rolette says she hopes that ownership will help bring the residents closer to each other.

“Mission Plaza will be theirs,” she said. “They won’t let it get all shot up. They’ll be able to choose who they want to live there, and they’ll watch out for their neighbors.”

The budding sense of community among the tenants had its roots in the 1976 rent strike that lasted almost a year. Renters withheld their monthly payments because the building’s gas pipes leaked and the units were in disrepair.

At one point, Rolette and the others stashed almost $150,000 in frozen payments in a suitcase, hoping to use the dole as down payment on buying the building from the original owners. But when the owner declared bankruptcy, the tenants lost that chance.

Now that they are on the verge of realizing that dream, Etezadi said, tenant leaders will have to adopt new--and less militant--strategies.

“They will have to act differently now that they are owners,” he said. “Whereas the owner was the target of people’s energies when things went wrong, they are going to have to look to themselves now . . . I am confident they can do it.”

That may be starting, says longtime tenant Elena Yandell.

At a tenants picnic that drew nearly 50 people on a recent Saturday afternoon, Yandell suggested that the difficult process of creating a new sense of community at Mission Plaza is off to a good start.

“This is the first time in 20 years I’ve gotten together with the other tenants,” she said, smiling. “I think it’s wonderful.”