By Kevin Aldridge
The Cincinnati Enquirer

Twenty-five loans given to developers and landlords to refurbish low-income housing in Cincinnati under the Rental Rehabilitation Program have been turned over to the city's law department for legal action.

However, city administrators said it was unlikely that the city would recoup any of the money - more than $794,000 total.

That was one of several findings City Council members heard Wednesday as they reviewed a report examining the city's 17-year-old Rental Rehabilitation Program.

"What we found is not a real pretty picture," said Deborah Holston, assistant city manager responsible for development. "Rental Rehab is not what it was ... and it is not what it could be."

The city's study of the program revealed that 87 percent of the 340 loans made since the program's inception in 1986 are either active or have been forgiven or paid off. Four percent have gone to bankruptcy.

Nine percent of the loans, totaling $5.9 million, have gone to foreclosure. Two projects - Glengate Apartments in Pleasant Ridge and Huntington Meadows in Bond Hill - accounted for $4,498,000 of that money.

Of the 172 loans still active under the program, 140 are in good standing, seven are in default and 25 have been referred to the law department for legal action, according to the report. The loans are the result of ineffective screening and monitoring over a number of years, said Peg Moertl, director of the Department of Neighborhood Services.

To correct the problem, Moertl said, the city plans to conduct more consistent annual inspections and take legal action quicker when landlords fall out of compliance.

A group of Pleasant Ridge residents asked for more aggressive leadership in the city's law department to identify, document and prosecute landlords who operate crime-ridden apartments.

"You need laws with more teeth," said Tom Hagerty, a member of Pleasant Ridge Community Council's Glengates Redevelopment Taskforce. "Your empty threats (to landlords) became real threats to our citizens."

City Manager Valerie Lemmie put a freeze on funding Friday until new monitoring procedures could be put in place.

Email kaldridge@enquirer.com