The Teton County Housing Authority and the Jackson Hole Community Housing Trust have quashed a months-long feud over a $40,000 grant.

Neither party, however, has escaped unscathed.

“I think a lot of damage has been done by the conflict,” said Christine Walker, executive director of the authority.

With the threat of litigation off the table following a May 20 meeting, the organizations now have to focus on repairing their relationship, one that has been fraught with tension.

“It’s still tense,” Walker said. “It takes a lot of time to build trust. Working through this agreement and coming up with something that both sides are comfortable with goes a long way, but we’re taking baby steps.”

She likened the relationship to that of a married couple taking a trial separation.

The conflict was sparked by an announcement last December that the trust put up for sale a project at the corner of Millward Avenue and Kelly Street. The problem was that in 2007 the county had awarded the trust $40,000 collected from housing exaction fees to help pay for additional affordable housing for that particular project.

The fallout from the deal has resulted in one valley citizen sharply criticizing the trust for lack of transparency and slippery deals.

“It’s gotten to the point of absurdity from a taxpayer standpoint,” South Park resident Rich Bloom said at a May 20 housing authority meeting. “The money should have been returned last fall when [the trust] listed the property.”

While the trust and the authority have outlined a resolution of the dispute over the $40,000 grant, a deal has not been put in writing and signed.

When the grant was awarded in 2007, a use agreement detailed how the money was to be used. The document stipulated that the money should have been used “to plan and design the development of affordable housing on the corner of Millward and Kelly.”

The agreement says the project must conform to applicable land-development regulations, that it must exceed the affordable housing requirement for the project and that it must provide housing for families earning 120 percent or less of the area median income.

Authority staff interpreted that to mean that the trust violated the terms of the agreement by not actually building any housing.

Trust staffers, however, said they were required only to plan and design housing for the project, which they did.

The authority operates under a board selected by the Teton County Board of County Commissioners. The trust is a private nonprofit.

The authority’s board voted in April to file a lawsuit against the trust if it did not return the money by May 6.

In the ensuing months, trust officials dug in their heels and refused to return the money, saying they had fulfilled their end of the agreement.

No money was returned to the authority on May 6. Instead, trust board members sent a letter outlining two options – use the money for energy-efficient upgrades to its eight-unit Daisy Bush project in east Jackson or pay for the remaining design work necessary to complete that same project.

On May 20, the authority board met to discuss those options and agreed to allow the trust to use the $40,000 to complete the upgrades needed to achieve Energy Star certification for all of the units to be built in Daisy Bush.

Anne Hayden Cresswell, executive director of the trust, said she expects the trust will break ground on four of the eight units at Daisy Bush this summer, and the remaining four this fall or next spring.

The upgrades proposed by the trust are expected to cost about $6,300 per unit, Cresswell said.

“This was an option that we thought could satisfy the housing authority, could satisfy our needs and actually had a communitywide benefit,” she said.

During the May 20 meeting, Cresswell told authority board members that the trust had not yet secured any construction financing for the Daisy Bush project but believed it had raised the full subsidy needed for four of the units.

The new agreement still does not accomplish what exaction fees are meant for, Walker said, but will help the two sides avoid a costly legal battle.

“This is really a settlement,” Walker said.

Walker said she and authority board members approved creating a new agreement because it provides the agency, and homeowners, with a benefit.

Authority board members set two firm deadlines to be included in the new agreement.

By June 24, the board’s next meeting, both sides are expected to have approved a new use agreement.

And by June 2012, the authority board expects to have eight completed homes with eight Energy Star certificates.

Between those dates, the trust has to unwind a joint-company it formed with St. John’s Medical Center through which it jointly owns the Daisy Bush projects.

Several members of the public said the ordeal has badly damaged the credibility of the trust.

Bloom went on to chronicle a list of events that he said bear out that the trust is a “nontransparent” and “inconsistent” organization.

Bloom took issue with the trust’s handling of the McCabe Corner project in downtown Jackson. In 2005, the trust bought the property and received approval for a planned mixed-use development that included affordable housing, Bloom said.

The next year, the organization sold the project to the Eden Group, which “left the community with an entitlement, out of context, bulk and scale development that will eventually produce many, many more new jobs” and workers than can be housed in the three units in the project dedicated to affordable housing, Bloom said.

Bloom said the trust has misused public money on numerous occasions and frequently misrepresented its intentions.

“Even if the money is returned, please pursue damages to cover staff costs – authority staff time and county legal staff time,” Bloom said at the meeting. “Further, town and county leaders, please do not trust the trust. Do not partner or put at risk any future public money with this nontransparent and untrustworthy organization. You all have to be polite and professional. I am being direct and calling it as I see it. I find this saga a tragedy, given the years of fine work the trust has accomplished.”

During the meeting May 20, Bloom outlined a five-year history of what he said is troubling behavior on the part of the trust.

Cresswell said many of Bloom’s assertions were “dead wrong” and said that she and other trust staff plan to respond to the accusations later this week.

During the May 20 meeting, trust emeritus board member Frances Tessler responded to some of Bloom’s allegations, saying that in each case he cited there was some kind of restraint or change in circumstance to which the trust was responding.

“It takes real money and real time to try to get any of these things built,” Tessler said. “But to look back at any of these things and say they were fraudulent is wrong. Everyone was working best as they could to try to get affordable housing in the ground. It doesn’t always work the way you want it to.”