An ambitious $400 million plan is taking shape to transform the former St. Bernard housing development into mixed-income housing and the nearby City Park golf course into a championship-level course.

So far, $120 million is available for the project and construction has begun, with 466 of 1,325 mixed-income residences expected to be ready for residents to move in by November.

But the Bayou District Foundation, the group leading the development, still has several hurdles to clear before its plan can fully materialize. It still needs money for the remaining two-thirds of the project and the green light from City Park to overhaul the golf course.

And there’s the issue of how many former St. Bernard residents, displaced since Hurricane Katrina, will have access to the new homes.

Bayou District plans to apply for federal tax credits and wants to raise $40 million through national fundraising, although officials acknowledge that will be a challenge, given the logistical acrobatics of raising a large sum of money in a depressed economy.

“It’s kind of like Olympic fundraising,” said Gerry Barousse Jr., Bayou District Foundation chairman.

Barousse said he is encouraged to have the sponsorship of the Baton Rouge Area Foundation, the Greater New Orleans Foundation and the Fore Kids Foundation.

“While I think today isn’t the best day to be raising money, having a group like that will help get us through the down time.”

The St. Bernard concept is modeled after Atlanta’s East Lake development, a public housing development turned mixed-income community anchored by a professional golf course. The brainchild of Atlanta real estate mogul Tom Cousins, the project is credited with transforming a crime-ridden neighborhood into a destination for golf enthusiasts and a thriving residential community with a charter school.

“Their objective was to change the cycle of poverty,” Barousse said.

Like East Lake, Bayou District wants to make education a cornerstone of its development.

A $49 million charter high school is already part of the Recovery School District’s plan for the neighborhood, and Bayou District wants to build an elementary school and learning center for children ages 3 to 6.

“Our ultimate plan is to create a cradle-to-college education program and make sure we don’t have (students) fall off at high school,” Barousse said.

In 2007, public housing advocacy groups protested the demolition of all of the city’s housing projects, including St. Bernard.

Now that the buildings have been torn down, Bayou District officials say they don’t expect to have the same level of resistance as other mixed-income developments such as River Garden, which became controversial for replacing the St. Thomas housing projects.

“Katrina forced the razing of the buildings,” project spokesman King Logan said. “Everyone was already gone by the time they were ready to demolish the buildings.”

Despite the stipulation that one-third of the new St. Bernard residences will consist of public housing, neighborhood activist and former resident Endesha Juakali said he is skeptical that a sufficient number of former residents will be allowed back.

“Technically speaking, quite a few people are going to be able to get in. But we know they’re going to come up with rules and regulations to try to exclude them,” Juakali said.

Juakali described Bayou District as “scavengers” and said he has no plans to meet with its representatives. He does not intend to live in the new development, either.

“It would be like if you were going to build a house on top of the graves of your friends,” he said.

Bayou District officials say they are trying to make the neighborhood appealing to all income levels.

“Quite honestly, what we’re building is better than some of the best luxury housing in the city,” Barousse said. “There’s a realization that there’s an opportunity for these folks to have a part of something they’ve never had before.”

The U.S. Department of Housing and Urban Development and the Housing Authority of New Orleans selected the foundation for the job in 2007 after the agencies demolished public housing throughout the city post-Katrina.

Columbia Residential is the developer, and the contractors are Boh Bros., Texas BBL and Broadmoor LLC.

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