Unpaid water bills, foreclosure and board turmoil weigh on concerned Parade Park residents
Foreclosure has been on the table at Parade Park Homes, an aging housing cooperative in the 18th and Vine District, for months now. But due to a recent update, the possibility of foreclosure seems even more real.
The inside of Debra Williams’ two-bedroom townhome in Parade Park looks close to brand new. There’s modern, wood-paneled flooring that covers the first floor. The kitchen has new countertops, cabinets and stainless steel appliances.
The outside is a different story. The siding shows years of wear and tear. Gutters sag, and roofs are patched with tarps or missing shingles. Some units have broken windows or are boarded up.
Williams spent $20,000 renovating her townhouse when she moved in seven years ago, hoping she could retire at Parade Park near Kansas City’s 18th & Vine District.
“I didn't intend to leave here unless it was feet first. I mean, I hate to say it,” said Williams. “I just wanted it to be . . . this is my last stop.”
But rapidly changing circumstances at Parade Park have Williams worried she’ll have to leave it behind, along with some 200 other residents at one of the oldest Black-owned housing cooperatives in the nation.
“I thought, ‘This is my retirement home. This is what I – this is where I'm stopping,” Williams said. “And look at it now. Only to have to leave it, and whoever gets it, whether they be legal, homeless or whatever, I can't take it with me.”
Parade Park opened 60 years ago and, after decades of deferred maintenance, its 510 units are crumbling and its future remains in doubt.
KCUR has learned that residents have been receiving water shut-off notices from the city because the cooperative is more than $250,000 behind on its water bills. Parade Park has also defaulted on its loan and faces the possibility of foreclosure. And the board of directors assigned to oversee Parade Park remains in turmoil with several members leaving recently.
‘Plan for the worst and hope for the best’
Parade Park members learned at an Oct. 15 special meeting that the cooperative did not have enough money to pay its $10 million loan. The board told members they faced foreclosure by the end of the month. Though this claim is not entirely true, it caused residents to panic.
“Now that certain opportunities were not taken, the reality is setting in and there's no preparation,” said Myrtle Bailey, a Parade Park resident and former board secretary. “Intelligent people plan for the worst and hope for the best. We have not planned for the worst. So our hope is destroyed.”
The board’s announcement came two weeks after receiving a notice from Parade Park’s lender, Gershman Investment Corp. in St. Louis, demanding that their almost $10 million loan be paid within the next 30 days. The U.S. Department of Housing and Urban Development (HUD) guaranteed Gershman’s loan.
“The process that will occur after the acceleration is that we (Gershman Investment Corp.), will be assigning our loan to the FHA/HUD at which time, they will become the Lender,” Gershman president Bruce Sandweiss said in a statement to KCUR. “This could take place as soon as November or as late as February.”
Sandweiss said that after the loan is assigned to HUD, it’s up to HUD to determine next steps. He said HUD can choose to foreclose or sell the note at an auction.
“Either way, a foreclosure will almost certainly occur but definitely not by the end of the month,” Sandweiss said. “It may be 6-12 months away or even longer.”
A day before the loan was accelerated, on Sept. 29, board members Bailey, Glenda Busnell, and Donald Jones resigned from the board. Bailey said earlier that month, other board members were trying to push her off of the board and she was demoted from her position as secretary. She said the directors and operators insurance designed to protect board members if Parade Park was sued expired. This ultimately prompted her and the others to resign.
Parade Park is current on its mortgage payments, but a failed HUD inspection in 2022 put Parade Park in default on its loan. Because conditions were so bad at Parade Park, multiple city and state officials urged the board to consider redevelopment. In June, the board heard presentations from two groups.
One by the non-profit developer, Community Builders of Kansas City, sought to completely redevelop Parade Park. The other, by the National Association of Housing Cooperatives, sought to work alongside the board to find a developer to revitalize the property and maintain its cooperative status.
Bailey said she and many of the co-op members, including the Williams sisters, called for board president Harrietta Harris to bring the two plans to a vote, so residents could have a say in what was done.
According to Bailey, Harris never did so. On a hot day in late June, panicked residents met in a parking lot at Parade Park and voted overwhelmingly for a full-scale redevelopment, even if it meant losing cooperative status. Harris would not certify the election.
Bailey said on Aug. 23, members voted unanimously to censure and express no confidence in board members: Harris, Diane Bratton, John Jackson, Don Williams, Gwennetta Wilson and Barbara Lane.
“Then on September 10th, we had a meeting, special membership meeting, to vote them out of office. And at that meeting, we had 58 or 59 votes to vote to remove them,” Bailey said.
Bailey said that Parade Park bylaws state that to carry out a vote successfully, they needed 51% or the majority of the membership to vote. They were 21 votes short.
Still in limbo
Parade Park residents are still in limbo and unsure of what comes next. In an emailed statement to KCUR, a HUD spokesperson said foreclosure is not the only option.
“Foreclosure is one of several possibilities after the mortgage is assigned to HUD; however, HUD will wait to see what the Board’s response to the lender is and the Board’s plan for curing the physical deficiencies at the property before determining what further action will be taken,” the statement reads.
When asked what the other options are, HUD responded that, when possible, they prefer to keep housing in the private market. But when a property is assigned to HUD through its mortgage insurance program, the mortgage must proceed through HUD’s disposition procedures and third-party reports are done to evaluate options for the property.
“Options for disposition vary and include a note sale, negotiated foreclosure sale, and a competitive foreclosure sale,” the spokesperson said. “While these are some of the most common disposition options, these options are not exclusive.”
Harris and other current board members could not be reached for comment. But Bailey, Bushell, and the Williamses claim the board still refuses to select a developer and let go of cooperative status. They all strongly believe that Harris never planned to redevelop, allowing for foreclosure.
Bushnell said she had a phone call in late March 2022 with Harris to express her concerns about foreclosure.
“She [Harris] had told me that she'd rather see the property foreclosed on than redevelop,” she said. “That was very shocking to me.”
Bushnell adds that early on, in an April meeting with potential developers and city and state officials, the board voted 5-3 for redevelopment. Bushnell was among those who voted to redevelop.
“So I felt like, well, they agreed that they were going to do redevelopment six to three, which was, and a quorum was there, so it was a proper procedure,” Bushnell said. “And then suddenly that was no longer, that was negated, by the majority of the board.”
‘And it just hurts’
Recently, after nearly 20 years at Parade Park, Bushnell moved out. She said it was heartbreaking. She was two years away from retirement. But now, she isn’t sure she can afford to retire.
Bushnell said she no longer felt safe at Parade Park, but moving out was still very emotional for her.
“I really, really, really, really, really thought that this was going to, you know, work out. And that Saturday, even learning of the ongoing lies and commitments and promises that they're [the board] continuing to make, telling people that they're gonna get $25,000, just wait, HUD is gonna pay them. They're still saying this stuff, and it's not true,” Bushnell said. “And it just hurts that, you know, I'm 63 and there are people older than me that believe in these people that have led them down this path.”
But others, like the Williams sisters, feel stuck at Parade Park until a decision is made. Debra Williams said her occupancy agreement doesn’t expire until 2025. Lynn Williams said hers expires in 2023. They say as much as they want to leave, they cannot afford both carrying charges and rent. They’re afraid of legal repercussions if they break their agreements.
Debra Williams said living conditions seem to be getting worse.
Williams said they have received two water service interruption notices due to the overdue bill. Water bills, she said, are paid by residents through their carrying charges, so the board is responsible for writing that check.
“With a $200,000 water bill, what’s that tell you, you know, of the fear we have?” said Williams. “I fear of everything deteriorating.”
A Kansas City Water Department spokesperson said Parade Park hasn’t paid its water bill in six months and is $251,214.39 behind in payments. When asked whether or not water services could be shut off, the spokesperson told KCUR, “KC Water will continue to work with the parties to come to a resolution for our customers.”
Lynn Williams said the uncertainty about her living situation is negatively affecting all of their health.
“There is that, that fear in your body. But we were talking about right, when you're looking, when you're starting to make your moves, your whole body is just outta sync. Your mind is outta sync,” she said. “It is something it does to your body, your heart, mind and soul when you don't know how much time you have to leave.”