Former Owners Pay $800,000 in Civil Penalties for Not Complying with HUD Lead Disclosure and Lead Safe Housing Rules

HUD Region II Regional Administrator Lynne Patton delivers remarks and acknowledges NJ State Senator Ronald Rice; former NJ State Senator Jennifer Beck; tenant advocate Bill Good; HUD NJ Field Office Director Maria Maio-Messano; and HUD Associate General Counsel for Program Enforcement, Dane Narode; for their efforts in ensuring that residents of Garden and Spruce Spires can soon enjoy safe and sanitary homes.

After years of effort by federal, state, local officials and stakeholders to improve living conditions and the quality of life of residents at dilapidated Garden and Spruce Spires multifamily developments in Newark, Omni America, LLC purchased the properties, committing to extensive rehabilitation.

For years, the more than 600 units, most of them home to low-income, HUD subsidized families, were plagued by years of neglect and building code violations. The planned rehabilitation by Omni America, LLC, will be funded and financed by the State of New Jersey and will remediate all past safety violations. HUD provides project-based Section 8 rental assistance for 350 units at Garden Spires and 112 units at Spruce Spires and renewed the HUD Housing Assistance Payment (HAP) contracts for the next 20 years.

As part of its Protect our Kids! Campaign, the U.S. Department of Housing and Urban Development (HUD) also announced that it has reached a settlement agreement with prior owners First King Properties LLC and 117 South Fourth Street Realty, for failing to provide decent, safe, and sanitary housing conditions to their residents.

The former owners and managers are required to pay $800,000 in civil penalties for not complying with the HUD Lead Disclosure Rule and Lead Safe Housing Rule. HUD previously issued notices to the owners and managers of Garden Spires Apartments informing them that they failed to provide decent, safe, and sanitary housing and failed to comply with the Lead Safe Housing Rule and Lead Disclosure Rule.

"This is a monumental day for the residents of Garden Spires and Spruce Spires who have endured deplorable conditions for far too long but will finally enjoy the homes they deserve. As HUD Regional Administrator, we have officially declared war in NY & NJ on absentee landlords who abuse the system and violate the very tenets of humanity by failing to protect children from lead poisoning and provide the fundamental housing standards as required by law. I want to offer my congratulations to NJ DCA, NJ HMFA, developer OMNI, and the fiscal partners that made this happen; and a special thanks to Senator Rice, former NJ State Senator Jennifer Beck & Mayor Ras Baraka for triggering the series of events that brought us here today." said Lynne Patton, HUD Regional Administrator for New York and New Jersey.

Federal, State and local elected officials and new owners Eugene Schneur and Maurice "Mo" Vaughn of Omni America LLC voiced their commitment to rehabilitating the properties. HUD Region II Regional Administrator Lynne Patton delivered remarks, alongside New Jersey Lt. Gov. Sheila Oliver; Newark Mayor Ras Baraka; New Jersey Housing Mortgage Finance Agency Director Charles Richman; and New Jersey Economic Development Authority Chief Executive Officer Tim Sullivan. Also in attendance were HUD New Jersey Field Office Director, Maria Maio Messano; HUD Associate General Counsel for Program Enforcement, Dane Narode; HUD Multifamily NE Hub Acting Director, Brett Wise; HUD Multifamily Director of Asset Management, Dean Santa; HUD Resolution/Funding Specialist, Chief Asset Management, Margaret Wingate; and HUD Branch Supervisor, MFH Asset Management Natasha Saxton.

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