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Loveland - September 4, 2010

On August 9, the Loveland Planning Commission heard public testimony from 88 year-old Mirasol resident,
Bette Jacobs, about unresolved problems with her unit in the Mirasol Senior Housing community in south
Loveland.  She and others attended the August 9, Planning Commission meeting to voice their objections to
the city approving another phase of the Mirasol project when the first phase is riddled with unresolved
complaints and broken promises to senior residents.

Among their complaints is advertising that continues regarding the Mirasol project's amenities.  Residents
were informed, after moving into their units, that the senior shuttle service is not really available as advertised
but only in limited circumstances.  A hefty fee for maintenance is charged for the snow removal and grounds
maintenance which one former resident told Lovelandpolitics ranges from sub par to non-existent.  The
complaints are many and the resolutions few.  Even the type of windows in the units is in question as being
too difficult for seniors to operate.

The Planning Commission ignored the 88 year-old resident and her supporters' requests not to approve
another phase of Mirasol as did Sam Betters of Homequest Development; the developer.  Betters is said to
have privately lobbied Mirasol residents not to complain publicly for fear of turning-away private investors in
the next phase of the already troubled project. The community building in the project is owned by
Loveland's Housing Authority along with other parcels while Better's Homequest Development LLC is
recorded by the county as the owners of the units for sale or rent in the project.

According to one resident, Loveland’s Housing Authority moved a number of Section 8 residents from other
Loveland senior housing projects into Mirasol when they were unable to fill units that sat vacant for nearly
two-years at Mirasol.  One former resident told LovelandPolitics they were asked not to comment on the
efforts by the Loveland Housing Authority to move them to Mirasol.  The Housing Authority has been
working to fill the project that appears overpriced for the market in both rents and sales prices.

Mirasol Senior Housing provides low-income seniors apartments and paired units in the south Loveland
heavily government subsidized development.  Many of the “affordable” paired units which were advertised
in the $250,000 plus price range failed to sell and are now being offered for rent by Homequest Development
LLC.

Loveland's Planning Commission suggested Jacobs take her complaints to Loveland’s Affordable Housing
Commission.  Than Loveland’s Planning Commission voted to approve the next phase of the Mirasol project
-- ignoring pleas from residents to reconsider until the first phase is fully occupied and operating properly.

Darcy McClure, Director of Loveland Human Services, and longtime acquaintance of Homequest's Sam
Betters, apparently decided to head Bette Jacobs and other Mirasol residents off at the pass by recruiting
“loyal” residents of Mirasol to attend the next Affordable Housing Commission meeting.  Seeing the obvious
ambush at the meeting prepared by McClure, the 88 year-old Bette Jacobs chose not to speak again in a
public forum but instead to get an attorney.

As a paralegal in the 1940’s and State of Colorado ombudsmen for convalescent care reforms of the late
1960’s, Bette Jacobs knew what she was facing.  Even at her advanced age, she wasn’t going to allow Sam
Betters or Darcy McClure intimidate residents of Mirasol who she believes have valid concerns over false
advertising and poor management of the project.

Raymond S. Hale, former head of the Ft. Collins’ Affordable Housing Board, is a Loveland attorney now
representing Bette Jacobs (see his email to the right of this story).  Intimately familiar with both state and
federal laws governing subsidized senior housing,  Hale is said to believe Loveland’s Housing Authority may
have broken federal law with regards to the Mirasol project.

In an August 27, 2010 email to Loveland Councilman Hugh McKean, Hale wrote,

“I have had a couple of meetings with my client, Mrs. Bette Jacobs and have reviewed a voluminous
amount of information regarding complaints made by residents in the Mirasol assisted living
development;  the history of efforts by Mrs. Jacobs and others to require remedies for various
management and maintenance problems they feel exist in said development; and questions they and I
have concerning the organization or the Mirasol Board of Directors, officers, and its relationship with
the Loveland Housing Authority, a non-profit entity organized by the city under the laws of the State of
Colorado and to be governed pursuant federal regulations.”

According to Hale's email, his client identified City Councilman Hugh McKean as the only city official willing
to listen to their complaints.

Potential Legal Problems For Mirasol
Underlying the typical kinds of complaints regarding inadequate maintenance, rude hosing officials and
inoperable windows, there are some more serious issues that cannot be easily remedied by the City of
Loveland or its independent housing authority.

HUD (Housing and Urban Development) Section 8 renters must not be charged any more rent than what is
called “market rate” for their units.  In other words, people who receive a significant federal subsidy of their
monthly rent cannot be charged more rent than the non-subsidized renters of similar units in the same
development.  Landlords have artificially inflated the value of the housing they are offering to government
subsidized renters to fraudulently receive more rent.  Thereofore, HUD strictly enforces rules that determine
whether the rent being charged is reasonable.

At $1,650 for the paired home units the Mirasol “market rate” appears to be at least 60% more than what a
1,000 sq. ft. rental unit in Loveland normally would rent for on the open market.  The Alamosa, a two
bedroom and two bath paired home offers seniors 1,012 sq. ft. of living area, is reported to have a market
rent in Loveland of $1650 per month plus the “maintenance fee.”  Historically, duplexes of equal size in
Loveland with a single car garage rent for between $600 to $850 per month.

By claiming this very high “market rate” the owners of Mirasol can then charge equally high rent to their
subsidized renters who have the Section 8 vouchers to pay the exceedingly high rent. They must prove,
however, the rent is indeed “market rate” by showing their private renters pay the same as those not
subsidized.

Here is the rub, the maintenance fee for “market rate” renters and subsidized renters is not the same at
Mirasol according to sources familiar with the project.  Therefore, the “market rate” renters pay a lower fee
thus adjusting the real commercial rate downwards in a way that doesn’t appear on the federal forms
provided to HUD by the operators of the complex.

If the fee is higher for the Section 8 qualified renters than Mirasol may be operating in violation of federal
law.  Mirasol cannot charge the subsidized tenants more than those paying market rate.  In addition, the
“market rate” units must also be rented at some point otherwise the higher price is just a ruse.

Bette Jacobs and now her attorney have not been provided any details on the finances at Mirasol despite
repeated requests.  Among the items they are seeking but not been provided is to know the salaries good
people like Sam Betters receive for their "service" to the elderly poor in Loveland.  Stay tuned.

If you live in Loveland senior housing, we would especially appreciate your comments on the blog whether
you agree or disagree with the information provided above.
LovelandPolitics.com
Mirasol Madness:
Loveland's Troubled Senior Housing Project
Email by Loveland Attorney
Raymond S. Hale


---------Forwarded message ----------

From: Raymond S. Hale <rhalels8@gmail.com>
Date: Fri, Aug 27, 2010 at 10:40 AM
Subject: Mirosol issues
To: hugh.mckean@loveland.co.us


Good morning Mr. McKean,

I have had a couple of meetings with my client,
Mrs. Bette Jacobs and have reviewed a
voluminous amount of information regarding
complaints made by residents in the Mirasol
assisted living development; the history of efforts
by Mrs. Jacobs and others to require remedies
for various management and maintenance
problems they feel exist in said development;
and questions they and I have concerning the
organization or the Mirasol Board of Directors,
officers, and its relationship with the Loveland
Housing Authority, a non-profit entity organized
by the city under the laws of the State of
Colorado and to be governed pursuant federal
regulations.

I have concerns regarding all of the above
issues, and I'm told by my client that you have
been one of a very few persons in a decision
making capacity who has listened to her
concerns in the past.  I have notified Mr. Sam
Betters regarding my client's issues, and he
responded the following day wanting to arrange
a meeting as soon as possible.

I prefer to meet with my client and you, as well
as any other Mirasol residents who desire to be
heard, to organize our mutual interests,
complaints, and proposed solutions.

I am representing my client essentially for no fee,
but may seek some recovery from entities who
may be found responsible for not responding to
Mirasol's various issues and problems.  My
client and I would like to meet with you at your
earliest convenience to discuss these matters;

Sincerely,

Raymond S. Hale
Attorney at Law
Sam Betters of Homequest.  
A limited liability company that
developed the heavily subsidized
Marisol Senior Housing project.
Home Ownership Mirasol Style
flipping backwards

According to Larimer County records;

On January 29, 2008 Mary Lee Desimone
purchased a property in the Mirasol Senior
Housing project located at 1250 Finch Street
from Homequest Development LLC.  
She paid
$254,500.

On November 17, 2009, she sold the property
back to Homequest Development LLC for
$194,260.

Sam Betters' company made $60,000 in a
period of 21 months.  It is the equivalent as if
they rented the house for
$2,868 per month for
nearly two years.

The City of Loveland waived the building fees
(CEF's) for this project among other costs
associated with the project since it qualifies as
"affordable housing."
See email response from one former resident regarding story below
Email by Carol Terrell