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The Boston Heights apartment complex in Annapolis, boarded up fencedoff and empty since late 1989, will reopen next year as newly renovated low-income housing.

Work on the 159-unit complex, long beset by open-air drug markets, sporadic violence and slum-like living conditions, is scheduled to begin within the next month.

Leslie Steen, president of the non-profit Community Preservation and Development Corp., which bought the complex for $2 million, told the Annapolis City Council Monday night that the complex should reopen as Admiral Oaks by March.

The council unanimously approved a resolution needed to enable the Bethesda firm to borrow $5.5 million forthe project from the state Community Development Administration.

The developer also is counting $4 million from a private investor, who would receive federal tax credits.

Changes in federal rules shifting review of some low-income housing projects from the state to theDepartment of Housing and Urban Development delayed the project, offAdmiral Drive, by more than five months.

But Steen said she expects HUD approval within the next few weeks.

Low-income Annapolis residents, some of the estimated 700 on waiting lists for public housing, already have begun applying for apartments in Admiral Oaks.

Of the 159 units, 63 will go to tenants who will pay 30 percent of theirgross income for rent and receive the rest from Section 8 federal housing subsidies.

The other apartments will rent for about $450 a month to those who meet income eligibility requirements.

Former Boston Heights owner Sateesh K. Singh closed the complex in November 1989 after city officials threatened to condemn many units because of serious housing code violations.

Lawmakers also heard testimony Monday night on a plan to build 35 affordable town houses on three acres off Forest Drive.

City planners and a few nearby residents said they supported a plan by South County Residential Projects Inc. to build the homes near Bywater Road and Greenbriar Lane.

The city is borrowing about $450,000 and lending it to the non-profit developer to purchase the tract.

The developer is to repay the loan as the houses are sold.

Qualified buyers would pay $75,000 or less for the town houses.

In other action, the council:

* Postponed a public hearing on a plan to build eight town houses at Hilltop Lane and Merryman Road because Kinder Associates failed to post of notice of its plans early enough.

* Approved a motion commending eight-year liquor board member Arnold C. Gay for volunteer service to the city. Mayor Alfred A. Hopkins did not reappoint Gay this year.

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