A $12 million housing initiative aimed at bringing 50 rent-to-own homes to Buffalo’s East Side has been derailed, apparently due to opposition from a faith-based community development group whose president told top city officials the project isn’t good for the community.

The housing plan received initial support last year from Buffalo, which led to it receiving funding from New York State as well as a private investor.

But since March, when it won city planning board approval, the project has been stalled. City officials haven’t authorized the in-lieu-of-tax agreement the project requires and haven’t transferred to the Cleveland-based developer the vacant lots in the city’s Cold Spring and Masten districts that the project needs.

“At this point, we don’t know if the project is going to move forward,” said Aaron Pechota, vice president of development for NRP Corp.

City housing officials were not immediately available to discuss the issue, but it appears the main opposition to the NRP project comes from the Jeremiah Partnership, a collaboration of seven African-American churches working to revitalize the East Side that is headed by the Rev. Richard A. Stenhouse.

Stenhouse, pastor of Bethel AME Episcopal Church on Michigan Avenue and a former member of the Buffalo control board, said Mayor Byron W. Brown and city housing officials asked his opinion of NRP’s housing project.

“I told them I don’t think it’s a good project. I don’t think it’s a project that benefits the East Side community,” Stenhouse said.

Jeremiah Partnership favors targeted development over the scattered site housing NRP is proposing, Stenhouse said. Also, he said, Jeremiah prefers home ownership to rent-to-own homes. Jeremiah also objects to the city using $1.6 million of its federal housing funds on the project, and doesn’t think the NRP project fits into the Jeremiah Partnership’s strategic plan for redeveloping East Side neighborhoods, Stenhouse said.

Given Jeremiah’s opposition, Stenhouse said city leaders asked him what could be done so that the project would benefit the East Side community.

“We said [the project should] exceed minority hiring goals, and for NRP to provide other technical assistance” to help the local community learn the development business for themselves, Stenhouse said.

Stenhouse said the city set up a meeting between NRP and Jeremiah during which Jeremiah asked to be responsible for minority hiring on the NRP project, and to set up a mentoring program supporting future minority developers.

NRP in late 2007 entered into a contract with Belmont Shelters of Buffalo to serve as its local development partner on the project. Given concerns expressed by Stenhouse and the city during the March 2009 meeting, NRP agreed to also establish a minority component. NRP issued a Request for Proposals, asking those interested to submit their plans for involving minorities in the project.

Jeremiah Partnership was invited to submit a proposal and did, Stenhouse said. Several others also submitted proposals.

The one selected came from University at Buffalo’s Professor Henry Taylor, working with UB’s Center for Urban Studies, in conjunction with J. W. Pitts Planning and Development Co., owned by former Common Council President James W. Pitts. The proposal was superior and less costly than the Jeremiah proposal, said NRP’s Pechota.

Asked if he would have supported the NRP project if Jeremiah had won the minority contract, Stenhouse said he would have brought the contract offer to the Jeremiah board.

“I don’t know what they (board members) would have said. Our objections have always been the same,” Stenhouse said, referring to scattered sites and lease-to-own housing.

Pechota said his company doesn’t understand Stenhouse’s role in the project.

“First and foremost, I don’t know why he should have any say or position on decisions associated with any federal dollars the city administers,” he said.

Stenhouse responded that churches in the Jeremiah Partnership have been involved in East Side development for a long time.

“Combined, we have over 400 years of investment in our community,” he said, referring to several churches in the community.

Pechota also noted that Stenhouse was involved with a rent-to-own project that Belmont Shelters Corp. developed on the East Side three years ago. It involved 29 scattered homes using the same financial mechanism that NRP is using.

It’s partly because of that, Stenhouse said, that he opposes further scattered site housing. It’s preferable, he said, to do targeted development in neighborhoods where there has already been development. And home ownership, he said, is preferable to lease-to-own homes.