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HomeMy WebLinkAboutMN-IURAGOV-2022-10-25 108 E. Green St. Ithaca, NY 14850 (607) 274-6565 MEETING MINUTES ITHACA URBAN RENEWAL AGENCY GOVERNANCE COMMITTEE (GC) 9:00 A.M., Tuesday, October 25th, 2022 Common Council Chambers, Third Floor 108 E. Green St. (City Hall) Ithaca, NY 14850 Present: Kathy Schlather, Vice-Chairperson; Donna Fleming; David Whitmore Excused: Susan Cummings Vacancy: 1 Staff: Nels Bohn; Charles Pyott Guests: None I. Call to Order Vice-Chairperson Schlather called the meeting to order at 9:06 A.M. II. Agenda Additions/Deletions None. III. Verbal/Written Public Comments None. IV. Review of Meeting Minutes: April 25th, 2022 Whitmore moved, seconded by Schlather to approve the meeting minutes, with no modifications. Carried Unanimously: 3-0 V. New Business A. 2023 IURA Budget Bohn explained that Fall is the IURA’s budget season, so the Committee needs to review the various components of the proposed 2023 Budget and adopt it for the IURA Board to review. Bohn then walked through the major elements of his October 18, 2022 memorandum (excerpted below): The staff recommended 2023 budget of $417,841 represents an increase of 3.5% from the 2022 budget. 2023 revenues available to pay IURA expenses are projected at approximately $500,000, $82,000 more than annual operating expenses. Projected revenues in 2023 include one-time funding from the American Rescue Plan (ARP) totaling approximately $130,000. The final $50,000 of ARP funding is anticipated to be applied to the budget in 2024. Adopted: 1/27/23 IURA GC Meeting Minutes October 25, 2022 Page 2 of 11 2 The major drivers for IURA expenses are: • Staff • Health insurance premiums • Legal and other professional services The major drivers for IURA revenues are: • HUD grant awards, especially COVID-19-related awards • Loan repayments Following is a summary of these major budget drivers: Expenses After many years of mild inflation, the trailing August-August annual CPI was 7.6%, which ripples through many IURA operating expenses. Salaries and employee benefits account for 86% of the IURA budget. The budget retains all current staffing (3.63 FTE) and provides a 4.0% salary increase, roughly half of the CPI though higher than the 2.25% increase for the City Administrative unit agreement. Every 1% change in salaries changes the budget by $3,000. The City has initiated a compensation study that they will share with the bargaining units and may result in adjustments to salaries in 2024, particularly for positions that are difficult to fill. The Planning Division has had challenges attracting applicants for open planner positions. Providing a 4% increase in salaries can help the IURA remain competitive in the labor market. Health insurance premiums increased 8.6% in 2023, but two employees now gain health insurance coverage through their spouses. IURA pays up to 75% of out-of-pocket expenses to any employee who elects to maintain coverage through a spouse. In total, health insurance expenses are projected to decline 1% to just under $50,000 in 2023. Legal expenses are projected to increase by 6% to $19,000 to account for inflation. Other professional services are projected to increase 16% to approximately $25,000 to account for special survey, appraisal and abstract expenses associated with projected land conveyances associated with the Inlet Island urban renewal project. These expenses are expected to be reimbursed from property sale proceeds. Revenues In past years, HUD grants provide funding for approximately 44% of the IURA budget. While the 2022 HUD Entitlement grant provides level funding, CARES Act special CDBG-CV3 and HOME-ARP allocations are projected to provide $144,000 in administrative funding for 2023. A final $50,000 of HOME-ARP funding is anticipated to be available in 2024. HUD grant funding is projected to cover almost 73% of the 2023 IURA budget. Loan repayment revenues are projected to increase 33% to about $105,000 in 2023 due to increased loan activity. Reimbursable staff/legal expenses are projected to increase in 2023 to $36,500 for costs associated with urban renewal projects. IURA GC Meeting Minutes October 25, 2022 Page 3 of 11 3 Summary Overall, special one-time HUD awards (CDBG-CV and HOME-ARP) will allow the 2023 budget to be fully funded from projected revenues in 2023. These one-time funds will be exhausted after 2024, when the IURA budget may turn from an operating surplus to an operating loss in 2025 if other revenues sources are not identified. Sale of land for an urban renewal project, such as at Inlet Island, may result in lump sum revenue event or a new stream of revenues if structured as an owner-financed loan to the project sponsor. Should there be a shortfall in future years, funds can be drawn from existing cash accounts to balance the budget for a time. Fortunately, the #05 non-CDBG cash account currently has an unobligated balance of approximately $600,000 available to address future budget gaps until other revenues can be identified. Whitmore moved, seconded by Fleming: 2023 IURA Budget WHEREAS, the IURA desires to annually adopt an administrative budget to guide expenditures and manage financial resources of the IURA, and WHEREAS, New York State law governing public authorities requires submission of a proposed budget 60 days prior to the start of the next fiscal year, and WHEREAS, the IURA budget is due to be submitted to the New York State Authorities Budget Office (ABO) by November 1st of each year, and WHEREAS, the IURA Governance Committee reviewed this matter at its October 25, 2022 meeting and recommended the following; now, therefore, be it RESOLVED, that the IURA hereby adopts the FY2023 IURA Administrative Budget, dated 10/18/22. Carried Unanimously: 3-0 (continued on following page) IURA GC Meeting Minutes October 25, 2022 Page 4 of 11 4 IURA GC Meeting Minutes October 25, 2022 Page 5 of 11 5 IURA GC Meeting Minutes October 25, 2022 Page 6 of 11 6 IURA GC Meeting Minutes October 25, 2022 Page 7 of 11 7 Bohn explained the Bank Account Analysis tracks the status of the IURA’s different bank accounts, over a three-year period. Although the total balance has decreased over the past two years, that is because Cayuga Green LLC paid off its loan in full so that is no longer counted as annual income. Approximately $600,000 is held as cash-on-hand, which does not generate income. Each account type has its own set of restrictions on the use of its funds. IURA GC Meeting Minutes October 25, 2022 Page 8 of 11 8 B. Threshold for Dual Signatures on IURA Disbursement Checks Bohn explained the IURA has historically required two separate signatures for every check it issues, which can become cumbersome. The proposed resolution would establish a threshold of over $5,000 for checks requiring two signatures. Fleming moved, seconded by Whitham: $5,000 Threshold for Dual Signatures on IURA Disbursements WHEREAS, the IURA issues approximately 300 disbursement checks annually, and each check currently requires two signatures, and WHEREAS, occasionally, gaining the second signature delays issuance of a check that may create a hardship for a non-profit agency or incur a late fee on the IURA, and IURA GC Meeting Minutes October 25, 2022 Page 9 of 11 9 WHEREAS, authorized IURA signers for disbursements are IURA Director of Community Development, IURA Executive Director, IURA Chair, and an IURA Board member, and WHEREAS, maintaining a robust separation of duties limits the number of IURA-affiliated persons based in City Hall available to sign disbursement checks, and WHEREAS, IURA staff is exploring issuance of electronic checks through Tompkins Community Bank in lieu of paper checks to avoid delays via U.S.P.S. mail and increase efficiency, and WHEREAS, electronic checking through Tompkins Community Bank does not appear to readily provide for dual approvals on disbursements in a manner that mimics the IURA check-approval process, and WHEREAS, IURA staff has consulted with Insero & Company, LLP, the IURA’s auditor, which indicated that limiting dual signatures to higher disbursement amounts is acceptable and a common practice, and WHEREAS, analysis of checks issued in prior years results in the following statistics for disbursements over $5,000: Year Dollar Value of Disbursements Over $5,000 Number of Disbursements Over $5,000 $ % # % 2020 $1,465,960 81% 37 13% 2021 $1,161,483 72% 42 13% 2022 YTD $490,814 64% 22 11% And, WHEREAS, establishing a threshold over $5,000 for disbursements requiring dual signatures would capture 64%-81% of the value of IURA disbursements historically, and WHEREAS, at its October 21, 2022, meeting, the IURA Governance Committee reviewed this matter and recommended the following; now, therefore, be it RESOLVED, that the IURA hereby establishes a policy to require dual signatures only on IURA disbursements exceeding $5,000. Carried Unanimously: 3-0 C. IURA Governance Chairperson Nomination Bohn explained the Committee elects its own Vice-Chair, but nominates its Chair for the IURA Board to formally appoint. An IURA Board member is required to either serve as Chair or Vice-Chair. IURA GC Meeting Minutes October 25, 2022 Page 10 of 11 10 Whitham moved, seconded by Fleming (as amended): Nomination of 2022 IURA Governance Committee Chairperson WHEREAS, Eric Rosario, Chairperson of the Governance Committee, resigned from the IURA Board on May 27, 2022, and WHEREAS, Kathy Schlather serves as Vice-Chair of the Governance Committee, and WHEREAS, Donna Fleming was appointed to fill the IURA Board vacancy and has also been appointed to the Governance Committee, and WHEREAS, IURA by-laws provide that the committee membership shall elect its own committee Vice-Chairperson and nominate a candidate for committee Chairperson for consideration by the IURA Board, and WHEREAS, per the by-laws, an IURA Board member shall fill either a Committee Chairperson or Committee Vice-Chairperson position, and WHEREAS, officers of each Committee serve a one-year term, but continue to hold office until their successor is selected or appointed, and WHEREAS, at its October 25, 2022 meeting, the Committee called for nominations to serve as Committee Chairperson; now, therefore, be it RESOLVED, that the Committee hereby elects Donna Fleming as Vice-Chairperson of the IURA Governance Committee, and be it further RESOLVED, that the Committee hereby nominates Kathy Schlather as Chairperson of the IURA Governance Committee. Carried Unanimously: 3-0 VI. Other Business A. Review of IURA Financials: September 2022 Bohn walked through the Grants Summary and explained that the left-hand “On Schedule” column calls out any projects that are not on schedule and that may need attention. The “GO ITHACA Low- Income Support” project has been extremely slow in submitting voucher reimbursement documentation and is approaching the original termination date in its contract. The “Online Market Discounts for LMI/SNAP Customers” project has also been relatively slow in expending its funds and has not been serving as many beneficiaries as anticipated at this point in the process. Bohn added that many CDBG-CV-funded projects have involved considerably more work for IURA staff than expected. Altogether, however, the vast majority of projects have been progressing well in terms of expenditures and project completion. IURA GC Meeting Minutes October 25, 2022 Page 11 of 11 11 Bohn noted the “HVAC Upgrade” project, operated by St. John’s Community Services (SJCS), never succeeded in obtaining complete Davis-Bacon prevailing wage documentation, so was never reimbursed by the IURA, although the project was fully completed. B. Staff Report Bohn reported the sale of the 309 College Avenue (East Hill Fire Station) property is moving forward, including finalization of the terms of the Disposition & Development Agreement (DDA). The project is also moving through the Site Plan Review (SPR) process and no major issues have emerged. Bohn reported the City’s Restore NY6 (“Cayuga Street Rehabilitation”) $2M application was completed and submitted. The project consists of the rehabilitation of two adjacent vacant commercial multi-story buildings (115-121 S. Cayuga St. and 123 S. Cayuga St.). The buildings would be redeveloped for mixed- use (i.e., office, housing, retail), including 16 new affordable housing units and a new restaurant. VII. Adjournment The meeting was adjourned by consensus at 10:09 A.M. — END — Minutes prepared by C. Pyott, edited by N. Bohn.