Apartment Proposal Approved : Housing: A nonprofit group will buy and rehabilitate 38 run-down units. The city will provide a $1.4-million loan.

The City Council has approved a $1.4-million loan to a nonprofit housing corporation to buy and rehabilitate a group of rundown apartment buildings.

Councilman Tomas Ursua, who cast the lone vote against the proposal, said the project--which will cost more than $70,000 per unit--does not make sense financially and predicted that the city will be stuck with a bad loan on overpriced property.

But Councilman Willie E. White said the apartments in the 2100 block of North Towne Avenue are such an eyesore and the area has such a high crime rate that the city must act.

“I get phone calls all the time about robberies, partying all night, drugs and murder,” White said. “I’d pay almost anything to get rid of those apartments.”

Under the proposal, the nonprofit Greater Pomona Housing Development Corp. would acquire 38 apartments on six lots for more than $2 million and spend $420,000 to rehabilitate them.

The apartments would be managed by National Housing Ministries, which runs the corporation’s other two projects: Emerson Village, a 165-unit senior citizens complex in Pomona, and Access Village, a 24-unit complex for the physically disabled in Claremont.

Morgan R. Sly, vice president of National Housing Ministries, said many details, including a final agreement on the purchase of the Towne Avenue property, are still to be worked out.

The city would provide two loans, using $688,000 from the redevelopment agency and $779,000 from a federal housing program. The use of the federal money would require that at least 19 of the 38 apartments be rented at rates affordable to low-income tenants for 15 years.

The corporation would use a $1.2-million loan from a private lender to raise the remainder of the $2.6 million needed for the project. The plan calls for spending $12,222 per apartment on rehabilitation. The remaining costs would cover the purchase price and other expenses.

Mayor Donna Smith strongly supported the project, saying that the corporation has a track record of success and this proposal is an opportunity to clean up a crime-plagued neighborhood.

But Ursua said the project is not well thought-out.

“Are we going to rehabilitate apartments for crime-oriented tenants?” the council member asked. “Why this site? There are innumerable sites that are blighted and depressed.”

Also, Ursua said, no appraisals have been done to show whether the property is being acquired at a fair price.

Art Steffen, real estate agent for the corporation, said the price is not cheap because the owners are not eager to sell.

Other council members said they shared Ursua’s concerns about the cost but still joined the six who voted for the loan.

“I’m going to support this project because we have to start somewhere,” Councilwoman Nell Soto said.

The city has given millions of dollars to developers for commercial projects and it is time that something was done to upgrade blighted residential areas, she said.