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Home My WebLink AboutMN-IURA-2019-12-23 108 E. Green St. Approved: 2/6/20 Ithaca, NY 14850 (607) 274-6565 MINUTES ITHACA URBAN RENEWAL AGENCY (IURA) Common Council Chambers, City Hall 9:00 A.M., Monday, December 23, 2019 Members: Svante Myrick, Chair; Tracy Farrell, Vice‐Chair; Karl Graham; Chris Proulx Excused: Eric Rosario; Laura Lewis (Common Council Liaison) Staff: Nels Bohn; Charles Pyott Guests: James Trasher, CHA Design/Construction Solutions I. Call to Order Chair Myrick called the meeting to order at 9:05 A.M. II. Agenda Additions/Deletions None. III. Public Comments (3‐min. maximum per person) None. IV. Agency Member Response to Public Comments None. V. Review of Meeting Minutes: October 24, 2019 Farrell moved, seconded by Proulx, to approve the October 24, 2019 minutes, with no modifications. Carried Unanimously: 4‐0 VI. Economic Development Committee (EDC) A. Cayuga Green Urban Renewal Project ― Request for Assignments, Consents, & Approvals to Facilitate Conveyance of The Lofts on Six Mile Creek and Cayuga Place Projects Proulx explained the current owner is seeking to sell the residential portions of The Lofts/Cayuga Place properties. It has asked the City and IURA to assign the parking connector between The Lofts and the parking garage, as well as agree to some other assignments and corrective legal instruments. IURA loans would be repaid in full at the time of sale. The Committee reviewed and approved the request. IURA Meeting Minutes December 23, 2019 Moved by Proulx, seconded by Farrell: Cayuga Green Urban Renewal Project ― Conveyance of Various Private Sector Components WHEREAS, the Cayuga Green public‐private project includes the following major components:  235 S. Cayuga Street – a 679 public parking garage with 23,000 sq. ft. of ground floor commercial space;  131‐135 E. Green Street – Cayuga Place with 68 apartments and 20,000 square feet of commercial space;  120 E. Green Street – an 11,000 sq. ft. 5‐screen cinema (Cinemapolis);  217 S. Cayuga Street – The Lofts at Six Mile Creek, a 46 unit residential building with pedestrian connector to the Cayuga garage;  The 600 linear foot public Six Mile Creek Walk; and WHEREAS, the IURA’s private sector partners, Cayuga Green Apartments, LLC, successor‐in‐interest to Cayuga Green, LLC, and The Lofts on Six Mile Creek, LLC, have entered into purchase and sale agreements to convey 131‐135 E. Green Street (Cayuga Place) and 217 S. Cayuga Street (The Lofts on Six Mile Creek) to HH Cayuga Place Property, LLC and HH Cayuga Lofts Property, LLC, respectively, and WHEREAS, the IURA received requests for various consents, assignments, corrective instruments and approvals to facilitate the proposed conveyance, and WHEREAS, outstanding IURA loan balances totaling approximately $880,000 issued to The Lofts on Six Mile Creek, LLC and Cayuga Green, LLC will be paid in full upon conveyance, and WHEREAS, the proposed conveyance will not impact operation or ownership the Cayuga public parking garage, the Six Mile Creek Walkway, Cinemapolis, or the ground floor tenants at the Cayuga Garage, and WHEREAS, the Economic Development Committee reviewed this matter at their December 17, 2019 meeting and recommend the following; now, therefore, be it RESOLVED, the Ithaca Urban Renewal Agency hereby approves the consents, assignments, corrective instruments and agreements requested by Cayuga Green Apartments, LLC, successor‐in‐interest to Cayuga Green, LLC, and The Lofts on Six Mile Creek, LLC, necessary to facilitate conveyance of the Lofts on Six Mile Creek and Cayuga Place projects, including but not limited to the following: RE: Lofts on Six Mile Creek, 217 S. Cayuga Street 1. Consent to the assignment and applicable estoppel agreement of the Walkway Agreement from The Lofts on Six Mile Creek, LLC to HH Cayuga Lofts Property, LLC; 2. Consent to the assignment and applicable estoppel agreement of the Parking Agreement from The Lofts on Six Mile Creek, LLC to HH Cayuga Lofts Property, LLC; IURA Meeting Minutes December 23, 2019 3. Consent to the assignment of the Payment in Lieu of Tax Agreement from The Lofts on Six Mile Creek, LLC to HH Cayuga Lofts Property, LLC; RE: Cayuga Place, 131‐135 E. Green Street 4. Consent to the assignment of the Payment in Lieu of Tax Agreement from Cayuga Green Apartments, LLC successor‐in‐interest to Cayuga Green, LLC, to HH Cayuga Place Property, LLC; 5. Amendments, filings, releases, and conveyances to exclude Parcel F of the Cayuga Green project (the small parcel containing the former helix entrance/exit to the Green Street parking garage) from various deeds and/or lease, sublease, leasehold mortgage and assignment of rents agreements associated with 2003 Cayuga Green tax‐exempt revenue bond financing, and be it further RESOLVED, the IURA Chairperson is hereby authorized, subject to advice of IURA legal counsel, to execute any and all necessary documents to implement this resolution. Carried Unanimously: 4‐0 B. Green Street Garage Mixed Use Urban Renewal Project 1. Western & Center Section – Asteri (Vecino Group NY, LLC): Project Update  VERSION 1 ― ORIGINAL CONCEPT: 11 stories, 218 affordable units, 2‐story 49,000 SF conference center, 350 parking spaces (excludes east section of garage)  VERSION 2.1 ― EXCLUDES CONFERENCE CENTER: 8 stories, 173 affordable units, 1‐story 9,000 SF commercial (light‐gauge steel construction like City Centre)  VERSION 2.2 ― EXCLUDES CONFERENCE CENTER: 12 stories, 273 affordable units, 1‐story 9,000 SF commercial (structural steel construction like Harold’s Square) Proulx explained the project proposal was brought before the Board of Public Works (BPW) for its review and BPW recommended it to Common Council, with the caveat that a dedicated fund be established for maintenance and repair of the parking garage. Common Council voted unanimously in favor of approving the Disposition and Development Agreement (DDA), as part of a preliminary non‐binding determination. The project will eventually return to Common Council for a Public Hearing and a final decision, after Environmental Review and Site Plan Review. Bohn explained the developer will submit its proposal to the Planning & Development Board in January 2020. Construction is expected to begin in May 2021, if approved. The New York State funding application for the residential portion of the project is being finalized and should be submitted in the first quarter of 2020, with a funding agreement in place by December 2020. Bohn reported that the conference center was awarded a $5M grant from NYS Empire State Development (ESD), so the conference center planning process now needs to move to the next stage: identifying additional funding mechanisms with the hospitality industry and other local municipalities, and establishing a Tourism Business Improvement District (TBID). IURA Meeting Minutes December 23, 2019 Bohn noted the hospitality industry has been very supportive of the conference center, conceptually. The issue will be to work out the necessary funding rate, which the hospitality industry would be willing to support. There have been some concerns about ensuring the funding formula for the hospitality industry is as geographically equitable as possible. Bohn added both the City and County would also need to provide some level of financial guarantee for the conference center, in the event of any shortfalls. Graham asked what the total funding amount should be to ensure the conference center’s feasibility. Bohn replied approximately $30M. The project’s NYS Upstate Revitalization Initiative (URI) application requested $7M, so at this time there is a $2M gap, which could be addressed with cost savings and other approaches. 2. Eastern Section – Rothschild Building (Ithaca Properties, LLC): Endorse Definition of Urban Renewal Project Proulx explained the revised proposal was reviewed by the Committee. If approved, the project would follow the same review and approval process/timeline as the Western & Center Section. Proulx noted two existing businesses located in the Rothschild Building (Sunny Days of Ithaca and Home Green Home) would most likely be temporarily displaced during construction. Bohn noted the Tompkins County Industrial Development Agency (IDA) indicated it does not fully support the approach used to increase affordable housing, since: (1) IDA lacks the resources and expertise to monitor and enforce a 30‐year affordability term; and (2) IDA does not believe the amount of local subsidy, exceeding $200,000/unit over 30 years, is a cost‐effective means to expand the affordable housing supply. Trasher briefly described some of the major project components:  13‐story mixed‐use building with frontage along The Commons and East Green Street  approximately 260 apartments, including studio and 1‐ & 2‐bedroom configurations  179 parking spaces (screened from the street)  10% of proposed housing units would be affordable at 80% Area Median Income (AMI), depending on Community Investment Incentive Tax Abatement Program (CIITAP) financing  Rothschild Building’s ground floor would be renovated to include amenity spaces (e.g., club room, community spaces, fitness center).  interior pedestrian connection from new building lobby at East Green Street to The Commons (serving as the building’s front entrance)  speed‐ramp with 30 below‐grade parking spaces for commercial and retail spaces  roof terrace for tenants (and possibly non‐tenant rentals)  Zoning Variance to add a 13th floor Trasher walked through an overhead presentation of the proposed project, including the images/plans below. (continued on next page) IURA Meeting Minutes December 23, 2019 IURA Meeting Minutes December 23, 2019 IURA Meeting Minutes December 23, 2019 Proulx remarked that the project was initially proposed to only designate 10% of its housing units as affordable for households earning up to 80% of Area Median Income (AMI), distributed pro rata across efficiencies and 1‐BR units. The Committee subsequently encouraged the applicant to pursue a goal of designating 20% of the housing units as affordable (subject to sufficient IDA and other financial incentives), distributed pro rata across all unit sizes. Graham asked if the average annual cash‐on‐cash return of 8.0% is based on what investors usually receive on large projects like this one. Bohn replied he consulted with Tompkins County Director of Assessment Jay Franklin, who indicated 8.0% is reasonable for a project like this, at this stage in its development. (continued on next page) IURA Minutes December 23, 2019 Moved by Proulx, seconded by Farrell: IURA Endorsement of Project Definition of Urban Renewal Project at Eastern Section of Green Street Garage Project Site WHEREAS, on June 27, 2019, the IURA designated Ithaca Properties, LLC as a “qualified and eligible sponsor” to potentially acquire air rights at the eastern section of the Green Street Garage site at 120 E. Green Street, Ithaca, NY, to undertake an urban renewal project, and WHEREAS, the IURA seeks urban renewal projects that improve the social, physical and economic social characteristics of the project site and expand access to quality affordable housing, and WHEREAS, upon review of the conceptual plans for the proposed urban renewal project, the IURA identified the following issues to be satisfactorily addressed prior to approving an urban renewal project: A. Sales price of project site (air rights); B. Proposed lease terms to City for rebuilt parking decks; C. Preliminary project schedule; D. Projected net increase in property tax revenues generated by the project; E. Compliance with Tompkins County Industrial Development Agency (IDA) implementation of the City Community Investment Incentive Tax Abatement Program (CIITAP) affordable housing policy, if CIITAP incentives are sought for the project (20% affordable units at 75% AMI required, if sufficient incentives are provided to retain financial feasibility of the project); F. Compliance with street‐level active use requirement; IURA Minutes December 23, 2019 G. Coordination with Marriott Hotel ownership regarding interim parking until newly constructed eastern decks are available for public parking; H. Approach by Marriott Hotel ownership to waive/exercise their option to purchase the site if the City conveys or decommissions the eastern parking decks; and WHEREAS, the 12/10/19 revised project plans and on‐going negotiation with the City and other stakeholders satisfactorily address all the above issues, except the Sponsor’s proposed workforce housing commitment has yet to be reviewed by the IURA, and WHEREAS, the IDA has not adopted a revised CIITAP policy to implement the City’s recommended CIITAP affordable housing policy, leaving the Sponsor in an uncertain position regarding IDA incentives available to support inclusion of below‐market rate housing, and WHEREAS, the IDA has raised the following concerns with the City’s CIITAP recommendation:  the IDA lacks resources and expertise to monitor and enforce a 30‐year affordability term; and  the amount of local subsidy exceeding $200,000/unit over 30 years is not a cost‐effective means to expand the supply of affordable housing, and WHEREAS, the Sponsor proposes to provide a minimum of 10% of the housing units to be leased at rents affordable to a household earning 80% of Area Median Income (AMI), provided such workforce units are distributed pro rata among efficiency and one‐bedroom units, and WHEREAS, the Sponsor further conceptually agrees to include additional below‐market rate housing affordable to households earning 80% AMI in the project, up to but not to exceed 20% of the total housing units, provided the project remains financially feasible, and WHEREAS, the Sponsor has indicated that its primary metrics to determine financial feasibility are satisfying the lender’s required debt service coverage ratio and the cash‐on‐cash return to investors; and WHEREAS, the Sponsor has prepared a draft pro forma based on provision of 10% below‐market rate units at 80% AMI and receipt of projected IDA incentives, and WHEREAS, the Sponsor has indicated the draft pro forma for the project (with 10% workforce housing) is financially feasible at an average annual cash‐on‐cash return of 8.0% over the first 8 years of occupancy, and WHEREAS, the IURA Economic Development Committee reviewed this matter and recommend the following; now, therefore, be it RESOLVED, that the IURA endorses Ithaca Properties, LLC’s proposed $90 million urban renewal project for the eastern section of the Green Street Garage Urban Renewal Project site as generally described in the 12/10/19 submission subject to the following clarifications and conditions: Project Program:  Below grade private parking spaces (47+/‐ spaces) IURA Minutes December 23, 2019  Reconstruction of public parking decks (137+/‐ spaces)  Street level actives uses (retail, commercial, lobby)  9‐10 upper levels of rental housing (230‐260+/‐ units of rental housing) Workforce Housing Goal:  20% of total housing units shall be occupied and affordable to households earning up to 80% of AMI, subject to sufficient IDA and other incentives to retain overall project financial feasibility with an average cash‐on‐cash return of at least 8%.  Workforce housing units shall be distributed pro rata across all unit sizes  Workforce housing units shall be similar in size to market rate units  Workforce housing units shall share the lobby with market rate units  Regulatory period: 30 years. Minimum Workforce Housing Commitment:  No less than 10% of total housing units shall be occupied and affordable to households earning up to 80% of AMI.  Workforce housing units shall be provided as close as possible to a pro rata distribution across all unit size categories with a minimum pro rata distribution among efficiencies and one‐ bedroom unit size categories.  Workforce housing units shall be similar in size to market rate units  Workforce housing units shall share the lobby with market rate units  Regulatory period: 30 years. Construction Impact Mitigation Sponsor shall submit a plan satisfactory to the IURA to address any business involuntarily displaced by the project. And be it further, RESOLVED, the IURA shall prepare a proposed Disposition and Development Agreement (DDA) upon completion of negotiations between the Sponsor and the City/IURA regarding the purchase agreement aspects of the DDA, including but not limited to terms for City lease of reconstructed public parking, and be it further RESOLVED, the IURA agrees to monitor and enforce required workforce housing in the project subject to receipt of an annual fee from the Sponsor to cover costs incurred. Carried Unanimously: 4‐0 IURA Minutes December 23, 2019 C. Cherry Street Industrial Park: Release IURA Deed Restrictions Proulx explained, originally, in the 1980s, no Site Plan Review, Environmental Review, or Stormwater Management standards were in place; and Zoning Requirements for the Cherry Street Industrial Park were significantly different than exist today. At that time, the IURA established certain lease covenants to ensure a minimal degree of quality for the properties it owned. Today, however, Site Plan Review, Environmental Review, and Stormwater Management standards are all well‐established, and the City recently rezoned the Waterfront district, so the lease covenants are no longer necessary. Moved by Proulx, seconded by Graham: Release of IURA Cherry Street Industrial Park Deed Restrictions WHEREAS, the IURA imposed certain lease and deed restrictions on all parcels in the Cherry Street Industrial Park to regulate certain architectural, dimensional and site plan standards to ensure a minimum quality of development in the industrial park, and WHEREAS, the industrial park was developed in the 1980s prior to adoption of site plan review and waterfront design guidelines currently in place, and WHEREAS, the deed restrictions reinforce various zoning requirements in effect in 1980, and WHEREAS, in 2017, the City adopted revised zoning for the waterfront zone, including the Cherry Street Industrial Park, that differ significantly from prior zoning, and WHEREAS, the deed restrictions restrict Cherry Street Industrial Park properties from taking advantage of revised land use regulations governing the waterfront area, and WHEREAS, the City now has a robust site plan review process in place to manage the issues contained in the deed restrictions, and WHEREAS, the lease and deed restrictions apply to parcels located at the following addresses:  230 Cherry St. (tax parcel #96.‐2‐1.5)  232 Cherry St. (tax parcel #96.‐2‐1.4)  233 Cherry St. (tax parcel #96.‐2‐1.8)  236 Cherry St. (tax parcel #96.‐2‐1.3)  239 Cherry St. (tax parcel #96.‐2‐1.9)  240 Cherry St. (tax parcel #96.‐2‐1.1)  241 Cherry St. (tax parcel #96.‐2‐1.22)  245 Cherry St. (tax parcel #96.‐2‐1.21)  247 Cherry St. (tax parcel #96.‐2‐1.23), and IURA Minutes December 23, 2019 WHEREAS, the IURA Economic Development Committee reviewed this matter at its December 17, 2019 meeting and recommend the following action; now, therefore, be it RESOLVED, that the IURA release the Development Restrictions, Conditions, and Covenants for all parcels in the Cherry Street Industrial Park; and be it further RESOLVED, that the IURA Chairperson is hereby authorized, subject to review by IURA legal counsel, to execute any and all documents to implement this resolution, including but not limited to a Release which will be recorded in the Tompkins County Clerk’s Office and cross‐referenced to all parcels subject to the Restrictions. Carried Unanimously: 4‐0 D. Committee Chairperson Report None. VII. Neighborhood Investment Committee (NIC) A. 2019 AcƟon Plan ― Program Amendment #2: A Place to Stay, Night/Weekend Support for Women in Transition (2019 Project #15) Graham explained that Catholic Charities initially planned on leasing a second transitional housing property from the same landlord as the existing one, but did not succeed. The program now plans to provide case management support for 10‐12 very low‐income homeless/at‐risk women. The Committee approved the amendment, given the importance of the program to the community. Moved by Graham, seconded by Farrell: 2019 HUD EnƟtlement Program ― Minor Amendment #2 A Place to Stay: Night/Weekend Support for Women in Transition (2019, Project #15) Catholic Charities of Tompkins/Tioga Counties WHEREAS, the 2019 HUD Entitlement Program Action Plan allocated $20,000 in CDBG funds to Project #15, A Place to Stay: Night/Weekend Support for Women in Transition, sponsored by Catholic Charities of Tompkins/Tioga Counties (CCTT) to provide night and weekend staff coverage at A Place to Stay, and WHEREAS, CCTT applied for but did not receive funding targeted for a second site proposed for the project, and WHEREAS, CCTT has determined it would not be fiscally responsible at present to proceed with the second site at this time, and WHEREAS, CCTT will continue operating A Place to Stay, as it has since May 2016, and IURA Minutes December 23, 2019 WHEREAS, as stated in its 2019 proposal, CCTT has identified a need for night and weekend staffing to provide additional support to women‐in‐transition, and WHEREAS, on October 11, 2019, CCTT requested IURA permission to use $20,000 allocated to the 2019 Project #15 for the same purpose as proposed, though with fewer low./mod.‐income beneficiaries, and WHEREAS, the original project anticipated 21 beneficiaries, but CCTT now anticipates 10‐12 beneficiaries, a change that requires a program amendment to the Action Plan; and WHEREAS, the Ithaca Urban Renewal Agency (IURA) is designated by the City of Ithaca as the Lead Agency to develop, administer and implement the HUD Entitlement grant program, including funds received through the Community Development Block Grant (CDBG) program, and WHEREAS, this matter has been reviewed by the Neighborhood Investment Committee of the IURA, which recommends the following; now, therefore, be it RESOLVED, the IURA approves a Minor Amendment with CCTT to reduce the anticipated number of low./mod.‐income beneficiaries from 21 to 10‐12 at A Place to Stay: Night/Weekend Support for Women in Transition project (2019 #15), and be it further RESOLVED, that the contract amount shall remain at $20,000, and be it further RESOLVED, that the IURA Chairperson, subject to review by IURA legal counsel, shall be authorized to execute a contract amendment to implement this resolution. Carried Unanimously: 4‐0 B. Committee Chairperson Report None. IX. Other New/Old Business A. Organizational Meeting for 2020 Action Plan Bohn reported the 2020 Action Plan cycle includes several special meetings.  Thursday, March 13, 2020 8:30‐11:30 A.M.  Thursday, March 26, 2020 8:30‐11:30 A.M. (Public Hearing)  Thursday, April 2, 2020 8:30‐11:30 A.M. (Public Hearing)  Thursday, April 16, 2020 8:30‐11:30 A.M.  Thursday, April 23, 2020 8:30‐11:30 A.M. IURA Minutes December 23, 2019 Bohn asked IURA Board members to inform Anisa Mendizabal if any scheduled dates will not work for them or if a conflict arises: AMendizabal@cityofithaca.org. Bohn walked through the following 2020 Action Plan Cycle Overview, prepared by Mendizabal: (continued on next page) IURA Minutes December 23, 2019 B. Review of IURA Financials: November 2019 Bohn reported virtually all HUD Entitlement Program projects are progressing well. The 2018 Neighbor to Neighbor Homeowner Rehab and 2018 Domestic Violence Center Renovation projects continue to make slow progress. Bohn reported all loan repayments are current, except the Finger Lakes School of Massage loan, which IURA staff is seeking to collect. Bohn reported all lease payments are now current. C. IURA Chairperson Report None. D. Common Council Liaison Report None. E. Staff Report Bohn noted there is an engagement letter in the meeting materials for Insero & Co. Certified Public Accountants, LLP, which will conduct its annual audit of the IURA by March 31, 2020, to comply with New York State Public Authorities Law requirements. IURA Minutes December 23, 2019 X. Adjournment The meeting was adjourned by consensus at 10:18 A.M. — END — Minutes prepared by C. Pyott, edited by N. Bohn.