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HomeMy WebLinkAboutMN-IURA-2026-08-27` 108 E. Green St. Ithaca, NY 14850 (607) 274-6565 MINUTES ITHACA URBAN RENEWAL AGENCY BOARD 9:00 A.M., Thursday, August 27th, 2026 Common Council Chambers, Third Floor (City Hall) 108 E. Green St., Ithaca, NY 14850 Members: Karl Graham, Vice-Chair; Shaianne Osterreich; Donna Fleming Excused: Robert G. Cantelmo (Mayor), Chair Vacancies: 1 Common Council Liaison: (not present) IURA Staff: Nels Bohn; Anisa Mendizabal; Charles Pyott [virtual] City Staff: Lisa Nicholas, Director of Planning & Development Guests: Kate de la Garza, Ithaca Neighborhood Housing Services, Inc. (INHS) I. Call to Order Graham called the meeting to order at 9:01 A.M. II. Agenda Additions/Deletions None. III. Public Comments None. IV. Review of Meeting Minutes: July 23, 2026 Osterreich moved, seconded by Fleming, to approve the meeting minutes with no modifications. Carried Unanimously: 3-0 Approved: 9/24/26 IURA Minutes August 27, 2026 Page 2 of 5 V. Neighborhood Investment Committee (NIC) A. HUD Entitlement Program: 2025 Community-Based Development Organization (CBDO) Designation of Finger Lakes ReUse Center, Inc. Graham explained that staff reviewed the CBDO application materials and identified no issues. All the board members meet the qualifications. The organization itself meets the qualifications also. Graham moved, seconded by Fleming: 2025 IURA Designation of Finger Lakes ReUse, Inc. (FLRU) As Community-Based Development Organization (CBDO) WHEREAS, the Board of Finger Lakes ReUse, Inc. (FLRU) seeks designation by the Ithaca Urban Renewal Agency (IURA) as a Community-Based Development Organization (CBDO), and WHEREAS, the City of Ithaca has designated the IURA to administer the City’s HUD Entitlement Program that oversees Community Development Block Grant funds awarded to the City, and WHEREAS, an eligible category of CDBG activities is a “Special Activity by CBDO”, that offers certain advantages, such as exemption from the 15% expenditure cap otherwise applicable to public service activities, authorization to carry out new housing construction (normally prohibited with CDBG funds), and discretion to allow income generated by a CDBG-funded activity to not be considered CDBG program income, and WHEREAS, the following four tests established at CFR Title 24 §570.204 must be met to qualify under a category of “Special Activity by CBDOs”: 1. The entity qualifies as a CBDO, including the 51% board membership test; 2. The CBDO will undertake an eligible project; 3. That the CBDO will carry out the funded activity directly or with an entity other than the grantee; 4. That the CBDO will not carry out a prohibited activity, and WHEREAS, a CBDO must maintain at least 51% of its governing body’s membership to be made up of any combination of the following: ● Low- and moderate income residents of its area of operation ● Owners or senior officers of private establishments and other institutions located in its area of operation ● Representatives of low- and moderate-income neighborhood organizations located in its area of operation, and WHEREAS, a CBDO must have as its primary purpose the improvement of the physical, economic, or social environment of its geographic area of operation, with a particular emphasis on the needs of low- and moderate-income persons, and WHEREAS, the project undertaken by the CBDO must qualify as one or more of the following project types: ● neighborhood revitalization; ● community economic development; IURA Minutes August 27, 2026 Page 3 of 5 ● energy conservation project; and WHEREAS, IURA evaluated FLRU’s CBDO application and recommended the following; now, therefore, be it RESOLVED, that the IURA determines that Finger Lakes ReUse, Inc. meets the requirements for eligibility as a CBDO, and that the FLRU’s “ReUse, IT, & Clean Energy Job Skills Training” program qualifies as an eligible CBDO activity, and be it further RESOLVED, that the IURA hereby designates Finger Lakes ReUse as a Community-Based Development Organization (CBDO) and its “ReUse, IT, & Clean Energy Job Skills Training” as eligible for CDBG funding under the category of “Special Activities by CBDOs.” Carried Unanimously: 3-0 B. Committee Chairperson Report None. VI. New/Other/Old Business A. Property Disposition: First Amendment to Disposition & Development Agreement (DDA) for 205 W. State Street Bohn explained that the Common Council approved the sale of the City-owned property at 205 W. M.L.K. Jr./State Street to INHS. INHS also executed a DDA with the City. De la Garza remarked that competition for 9% Low-Income Housing Tax Credits is particularly intense this year, while declining tax credit pricing and continuing increases in construction costs have created significant funding challenges for affordable housing projects. INHS is resubmitting its application for The Lucy and is currently seeking to close an approximately $1 million funding gap in order for the project to be considered fully funded and competitive for an award. Osterreich asked about the fact that banks are no longer willing to invest in Low-Income Housing Tax Credit (LIHTC) projects. De la Garza replied that banks invest in Low-Income Housing Tax Credits for the tax benefit as well as Community Reinvestment Act (CRA) credit and other benefits. She explained that banks generally favor investments in larger, more competitive CRA markets, placing smaller markets such as Ithaca at a disadvantage and resulting in lower tax credit pricing. Changes in the tax credit market over the past decade have further reduced the attractiveness and value of these investments, although INHS continues to work with longtime investor Enterprise Community Partners and other banking partners. Graham asked what the impact on the project would be if Ithaca is not awarded a DRI grant. De la Garza responded that, without the DRI grant, the project would not proceed in the current funding round, and INHS would need to reapply the following year, potentially delaying construction by two to three years. Graham asked Bohn what Common Council’s role was in setting the initial sales price. IURA Minutes August 27, 2026 Page 4 of 5 Bohn replied that Common Council endorsed INHS's proposal to acquire the property at appraised value, with the sales price based on a 2024 appraisal. He added that the property is not required to be sold at appraised value, however, and the final sales price may be negotiated through the disposition and development agreement process. Fleming asked Bohn how long the City owned the property. Bohn replied that the site used to be a gas station. Graham disclosed that his wife is on the Board of INHS. Osterreich moved, seconded by Graham: 1st Amendment to IURA Disposition & Development Agreement for 205 W. State Street IURA WHEREAS, on September 5, 2025, the Common Council for the City of Ithaca approved the IURA proposed sale of City-owned property at 205 W. MLK Jr./State Street to Ithaca Neighborhood Housing Services, Inc. (INHS) to undertake an urban renewal project to construct an affordable housing project with daycare facility, and WHEREAS, a Disposition and Development Agreement (DDA) was executed with INHS on September 3, 2025, to govern the sale and future use of 205 W. State Street parcel established the following terms: • Sales price: $370,000. • End use: construction of an approximately 50-unit affordable senior housing project with first-floor day care facility. • Seller contingencies: A. Closing is subject to proof of funding commitments sufficient to complete the project. B. Purchase and sale contract shall expire after 3 years or upon purchaser’s loss of binding site control of property situated at 209-217 W. MLK Jr./State Street, whichever occurs earlier, and WHEREAS, the INHS funding application for the project submitted to NYS Housing and Community Renewal (HCR) in 2025 did not receive an award of 9% low-income housing tax credits, and WHEREAS, INHS intends to submit a revised funding application to HCR by the September 10, 2026, deadline, and WHEREAS, changes in the tax credit market, HCR regulations, and increased construction costs have created a project funding gap, and WHEREAS, INHS requests each property owner of the project site reduce their sales price to assist in closing the project funding gap, and WHEREAS, INHS requests a revised purchase price of $277,500 for property at 205 W. State Street, and WHEREAS, the requested sales price is lower than the2024 appraised value of $377,000 but above the assessed full market value of $126,000; now, therefore be it IURA Minutes August 27, 2026 Page 5 of 5 RESOLVED, that the Ithaca Urban Renewal Agency hereby approves the first amendment to the “Disposition and Development Agreement – Property Located at 205 West State Street, Ithaca, NY” to modify the sales price of property at 205 W. MLK Jr./State Street to $277,500, and be it further RESOLVED, that the IURA approval is subject to Common Council endorsement following a public hearing held on the matter. Carried Unanimously: 3-0 B. Review of HUD Grant Disbursement, Loans & Leased Receivable Reports – June 2026 Bohn reviewed the Grants Summary, explaining that the left-hand “On Schedule” column calls out any projects (with a ) that are not progressing on schedule and may need attention. All loan payments are current. All lease payments are current. The2026 Action Plan has been approved by HUD by default, so those projects will be included on the next report. C. REPORTS: IURA Chair/Mayor, Common Council Liaison, & Staff IURA Chair/Mayor’s Report None. Common Council Liaison Report None. Staff Report Bohn reported that the Habitat for Humanity of Tompkins & Cortland Counties project, which received a time extension at the last meeting, did not ultimately need the extension. VII. Adjournment The meeting was adjourned by consensus at 9:43 A.M. — END — Minutes prepared by S. Dean, edited by C. Pyott/N. Bohn.