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Profit From Non-Profit?

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The ARC House on the North Side: The Catholic Diocese, and the deed, say not so fast to a sale. - PHOTO BY HEATHER MULL<
  • Photo by Heather Mull<
  • The ARC House on the North Side: The Catholic Diocese, and the deed, say not so fast to a sale.

The North Side's ARC House, founded in the 1960s as a non-profit program to rehabilitate drug addicts and alcoholics, was widely disliked by neighbors while some of those who used it called it a haven. Now the facility's future is being contested as well: The owners have been trying to sell the property over the past five months -- but doing so may conflict with provisions of the original sales agreement.

Housed in a former Mellon Bank building at the corner of East Ohio Street and Madison Avenue, the ARC House had sheltered parolees in a work-release program for nearly 20 years. Over the past decade, neighbors charged that it had served as a den for ill-supervised convicts released from prison. But the program, run by Chuck Cain of Ross Township and several of his children, closed down two weeks ago. The Cains now hope to sell the building and its adjacent vacant lots for $3.5 million.

"We're relieved" that ARC House is closed, says Ed Graf, a board member of the East Allegheny Resident Council, the neighborhood group that represents residents in the building's vicinity.

The building was sold to ARC House for a dollar in 1987 by the Catholic Diocese of Pittsburgh. But the deed included a provision barring the building's sale until 2037. "Grantee (the ARC House) shall not sell or transfer ... the property conveyed herein to any party other than [the diocese] for a period of fifty years from the date of this deed," the agreement reads.

Diocesan spokesman Father Ron Lengwin says the diocese may stake a claim to the property, hoping to benefit from its sale.

"The diocese did indeed purchase the property originally, for the possible site of a new church," says Lengwin. "The [ARC House] program is no longer in existence. The diocese would have some claim to the funds generated from the property we donated. That's why those conditions were there in the first place."

The agreement was forged, he adds, in the spirit of "one charity helping another charity."

"From the standpoint of community development, we'd be happy to be work with the diocese to find a good use for the building," says East Allegheny's Graf.

"Regardless of how we were able to obtain the building, we're trying to sell it," said Cain, before declining to discuss the sales agreement further.

As recently as 2004, Cain and his children, who served on the non-profit's board, together drew more than $200,000 in salaries, according to the latest tax returns filed by the ARC House. But Carol Mohr, one of Cain's daughters who helped with the operation, says the family is deep in debt, and desperate to sell the property in order to recoup some of its losses.

Questions about the deed mark just the latest in a series of concerns raised about the center.

Some neighbors have complained about the quality of the facility's convict monitoring, and fought the ARC House's expansion in 2003. But the center's fortunes began to change in 2005. Mohr says the ARC House failed to get the accreditation required by the county, and judges stopped allowing inmates to serve out their sentences there.

Some neighborhood residents see the ARC House site as a perfect spot for offices or affordable housing. Because of the location's history as a non-profit, some say, there is a greater public interest in its future.

"There are parties of interest that [the Cains should] demonstrate due diligence to," says Barbara Burns, a former city councilor who now runs a specialty store on East Ohio Street. "You don't get to sell [it] and keep the dough."

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