HomeMy WebLinkAboutMN-IURA-2010-12-17Ithaca
Urban
Renewal
Agency
Approved 2‐18‐11
108 East Green Street
Ithaca, New York 14850
(607) 274-6559 59
(607) 274-6558 (fax) (607) 274-6558 (fax)
MINUTESMINUTES
ITHACA URBAN RENEWAL AGENCY
Council Chambers, City Hall
8:30 AM, Friday, December 17, 2010
Present: Susan Cummings, Doug Dylla, Tracy Farrell, Carolyn Peterson
Other: J.R. Clairborne, Common Council liaison to IURA, Theresa Halpert & Caleb Thomas of the IURA
Neighborhood Investment committee
Staff: Nels Bohn, Sue Kittel, Alice Vargo
Public: Paul Mazzarella, Joe Bowes, Matthys VanCort, Scott Reynolds, Rachel Lampert, Steve Nunely
I. Call to Order
The meeting was called to order at 8:35 a.m. by Chairperson Peterson.
II. Additions to or deletions from the agenda – Bohn requested the addition of an item to recognize Wies
Van Leuken under New Business.
III. Public comment ‐ None
IV. Approval of meeting minutes for July 22, 2010 and October 28, 2010
Cummings moved, seconded by Farrell, to approve the July 22, 2010 minutes. Carried unanimously. Farrell
moved, seconded by Cummings, to approve the October 28, 2010 minutes with corrections. Carried
Unanimously.
V. Economic Development Committee
A. Request from Plantation Building LLC to subordinate an IURA mortgage on property located
at 20 Rosina Drive to facilitate refinancing (gateway proceeds, project #4)
Dylla introduced the issue and noted that under the proposed refinancing of 20 Rosina Drive, the
IURA will remain in 2nd lien position behind $417,000 held by a lender, so the IURA collateral
position is not materially impacted.
Moved by Dylla seconded by Farrell:
Subordinate IURA Mortgage on Property Located at 20 Rosina Drive
(Gateway Proceeds, project #4)
Whereas, on July 22, 2010, the Ithaca Urban Renewal Agency (IURA) approved a $490,000 loan to
Plantation Building LLC to redevelop the vacant Plantation Building located at 130‐132 MLK/W.
State Street, and
Whereas, the loan was secured in part by a 2nd mortgage lien on property located at 20 Rosina
Drive, Ithaca, NY, behind a 1st mortgage held by M&T Bank with a balance of $428,000, and
IURA Minutes
12/17/10
Page 2 of 12
Whereas, the owner of 20 Rosina Drive proposes to refinance debt on this property encumbered by
the IURA mortgage to take advantage of a lower interest rate, and
Whereas, the lender, M&T Bank, has agreed to refinance the property with a $417,000 loan
provided they have a 1st lien mortgage position, and
Whereas, the requested loan subordination will not adversely impact the IURA’s collateral position
securing the IURA loan to Plantation Building LLC as the IURA would remain as 2nd mortgagee
behind a 1st mortgage of $417,000, and
Whereas, at their December 14, 2010 meeting, the Economic Development Committee reviewed
this matter and recommended the following; now, therefore, be it
RESOLVED, that the IURA hereby agrees to subordinate the IURA mortgage held on property
located at 20 Rosina Drive, Ithaca, NY to M&T Bank in an amount not to exceed $417,000, and be it
further
RESOLVED, that the IURA Chairperson, upon the advice of IURA legal counsel, is hereby authorized
to execute all necessary and appropriate documents to implement this resolution, including, but
not limited to, a subordination agreement.
Carried Unanimously 4‐0
B. Request from Mack Travis for consent to transfer property and subordinate an IURA
mortgage on property located at 209‐217 W. MLK/W. State Street to facilitate refinancing &
estate planning (PB‐LF, project #2 State Theatre of Ithaca)
Dylla summarized that Mack Travis seeks to refinance and transfer the Family Medicine building at
209‐217 W. State/W. MLK Jr., Street to a newly formed limited liability company as part of estate
planning. He noted that the 209‐217 W. State/MLK Jr. property provides security for the IURA loan
to State Theatre of Ithaca, Inc. As proposed, the IURA will effectively retain its current 2nd lien
collateral position without any material change to the collateral value, he reported.
Motion by Dylla, Seconded by Peterson:
Consent to Transfer Property and Subordinate an IURA Mortgage on Property Located at 209‐217
W. MLK/W. State Street (PB‐LF, #2)
Whereas, on January 22, 2009, the Ithaca Urban Renewal Agency (IURA) approved a loan to State
Theatre of Ithaca, Inc. to acquire and operate the State Theatre, and
Whereas, the IURA loan was secured in part by a 2nd mortgage lien on property located at 209‐217
MLK/W. State Street (AKA Family Medicine Building) owned by Mack Travis, with a 1st first
mortgage lien in the amount of $398,000 held by Savings Bank of the Finger Lakes, and
Whereas, Mack Travis proposes to refinance and transfer the property encumbered by the IURA
mortgage for estate planning purposes, and
IURA Minutes
12/17/10
Page 3 of 12
Whereas, Mack Travis requests IURA consent to transfer the property from Mack Travis to 209
State Street Associates, LLC, a newly formed limited liability company with The Carol G. Travis
Irrevocable Trust as its sole member, and
Whereas, Mack Travis further requests the IURA to subordinate its $458,500 mortgage to a 1st
mortgage lien in the amount of $398,000 to be held by Tompkins Trust Company, and
Whereas, the requested loan subordination does not adversely impact the IURA’s collateral
position securing the loan to the State Theater of Ithaca, Inc, as the IURA would remain as 2nd
mortgagee behind a 1st mortgage of $398,000, and
Whereas, at their December 14, 2010 meeting, the Economic Development Committee reviewed
this matter and recommended the following; now, therefore, be it
RESOLVED, that the IURA hereby consents to the transfer of property located at 209‐217 MLK/W.
State Street from Mack A. Travis to 209 State Street Associates, LLC and agrees to subordinate the
IURA mortgage to the Tompkins Trust Company in an amount not to exceed $398,000, and be it
further
RESOLVED, that IURA Chairperson, upon the advice of IURA legal counsel, is hereby authorized to
execute all necessary and appropriate documents to implement this resolution, including, but not
limited to, executing a consent and subordination agreement.
Carried Unanimously 4‐0
C. Common Council repeal of apprenticeship policy & guidance to IURA regarding job training
& placement programming (2011 Action Plan)
Bohn summarized the City of Ithaca Common Council’s recent adopted resolutions (1)
repealing the apprenticeship policy and (2) reaffirming job training as a priority community
development need and encouraging the IURA to include effective job training and
placement programs in future recommended Action Plans for allocating CDBG funding.
D. Committee Chairperson Report –
Dylla reported that the committee reviewed the State Theatre of Ithaca, Inc. financials. Unearned
income of $240,000 exceeded projections, but earned income fell short of projections. Overall,
the net loss was $40,000 higher than projected. He noted that the committee planned to continue
to monitor the finances of this borrower.
VI. Neighborhood Investment Committee
A. Designation of Kitchen Theatre Company, Inc. as a CBDO
Rachel Lampert of the Kitchen Theatre Company (KTC) was invited to address the IURA. She noted
that their recent acquisition, rehabilitation and relocation of the Company to W. MLK Jr./W. State
Street has opened the opportunity to engage with the local neighborhood in a meaningful way and
they plan to undertake a variety of community development programs and projects that will
benefit the neighborhood.
IURA Minutes
12/17/10
Page 4 of 12
Cummings disclosed that her adult son has worked for KTC, but she receives no financial benefit
from this arrangement.
Farrell moved, seconded by Dylla:
IURA Designation of the Kitchen Theatre Company, Inc. as a
Community‐Based Development Organization
WHEREAS, the Board of the Kitchen Theatre Company Inc., (Kitchen Theatre) 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, the requirements for eligibility as a CBDO are established at CFR Title 24, Section
570.204 and include specific eligibility criteria for composition of the governing board of a CBDO,
and
WHEREAS, at their November 19, 2010 meeting, the Neighborhood Investment Committee
compared the Kitchen Theatre with CBDO eligibility requirements as documented in the attached
materials; now, therefore, be it
RESOLVED, that the IURA determines that the Kitchen Theatre meets the requirements for
eligibility as a CBDO, and be it further
RESOLVED, that the IURA hereby designates the Kitchen Theatre Company, Inc. as a Community‐
Based Development Organization (CBDO).
Carried Unanimously 4‐0
B. HUD Entitlement, reallocation of funds for the Rte 13 Pedestrian Crossings project due to
implementation delay (2010 CDBG #8)
Farrell moved, seconded by Dylla:
Reallocation of funds from CDBG 2010 #8 ‐ Rte 13 Pedestrian Crossings
Whereas, CDBG funds of $145,300 were allocated for the Rte 13 Pedestrian Crossings project in the
2010 Action Plan (CDBG 2010 #8), and
Whereas, City Traffic Systems Engineer Tim Logue has informed IURA staff that the project is in final
design as of November 2010 and once the design is complete there will be a lengthy land
acquisition process before the construction can begin, and
Whereas, the City Engineering Department is anticipating that the land acquisition process will be
complete and the project will be put to bid in very late 2011 or early 2012, and
Whereas, City Controller Steven Thayer has reported that there will be savings in bonding expenses
if the IURA portion of the Greater Ithaca Activities rehabilitation project is paid off as quickly as
IURA Minutes
12/17/10
Page 5 of 12
possible, as speedier repayment causes the City to bond a smaller portion of the total project cost,
and
Whereas, the 2010 funds from the Route 13 Pedestrian Crossing project could be applied to the
GIAC rehabilitation via reallocation, thus advancing the repayment schedule of the IURA portion of
the project expense, and
Whereas, the Route 13 Pedestrian Crossing can be funded as part of the 2011 Action Plan
without detriment to the project, and
Whereas, required public input processes for development of the 2011 Action Plan can be utilized
to also satisfy required public hearing and public comment opportunities for various proposed
reallocations of CDBG and HOME funds, and
Whereas, the Neighborhoods Investment Committee reviewed this matter at their November 19,
2010 meeting and recommended the following; now, therefore, be it
RESOLVED, that the IURA hereby reallocates $145,300 of 2010 funding for the Rte. 13
Pedestrian Crossings project (CDBG 2010 #8) to a new undesignated project as a part of the 2011
HUD Entitlement grant process.
Carried Unanimously 4‐0
C. Recertification of Ithaca Neighborhood Housing Services, Inc. as a CHDO
Farrell moved, seconded by Cummings:
HUD Entitlement Grant Program – 2010 Designation of INHS as a CHDO
Whereas, on June 23, 2005 the IURA designated Ithaca Neighborhood Housing Services (INHS) as a
Community Housing Development Organization (CHDO) in accordance with regulations contained
at 24 CFR §92.2, and
Whereas, the Ithaca Urban Renewal Agency (IURA) has been 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 Home Investment Partnerships (HOME) program, and
Whereas, grant recipients under the HOME program are termed Participating Jurisdictions (PJs),
and
Whereas, PJs must reserve not less than 15% of their HOME allocation for investment in housing to
be developed, sponsored, or owned by Community Housing Development Organizations (CHDOs),
and
Whereas, each PJ must identify annually CHDOs that are capable, or can reasonably be expected to
become capable, of carrying out projects to address priority housing needs identified in the
Consolidated Plan, and
IURA Minutes
12/17/10
Page 6 of 12
Whereas, a CHDO is a specific type of community‐based nonprofit organization as defined in 24 CFR
§92.2, and
Whereas, a PJ may use HOME funds to provide special assistance to CHDOs, including:
Project pre‐development loans;
Operating assistance;
Use of HOME project proceeds;
Capacity‐building assistance; and
Whereas, on December 3, 2010, Ithaca Neighborhood Housing Services, Inc. (INHS) submitted
materials documenting their continued eligibility as a CHDO and requested renewal of their
designation as a CHDO by the IURA, and
Whereas, at their December 9, 2010 meeting, the Neighborhood Investment Committee of the
Ithaca Urban Renewal Agency reviewed the submitted materials and recommends recertifying INHS
as a CHDO, and
Whereas, the IURA has reviewed this matter and determined that INHS meets the criteria for
designation as a CHDO, now, therefore be it
Resolved, that the IURA, acting in its capacity as the Lead Agency for the Participating Jurisdiction
of the City of Ithaca, hereby renews its designation of INHS as a CHDO for a one‐year period.
Carried Unanimously 4‐0
D. INHS request for financial assistance, INHS Breckenridge Place project (100 W. Seneca
Street)
Farrell introduced the issue and noted that the Neighborhood Investment (NI) Committee has met
several times to discuss this matter. She referenced members to a draft December 17, 2010 letter
from the NI Committee to INHS that communicates a list of items that they would like incorporated
into the project. Farrell also referenced members to a “Project Detail” sheet, dated 12/9/10, that
summarizes their understanding of the proposed project and funding request.
Farrell invited INHS representatives to address the Agency and answer questions. Paul Mazzarella
summarized the project and noted that the project has been modified somewhat to make it more
competitive for funding, but he has been able to incorporate a tenant income mix that includes
households earning 60%‐90% of area median income. Mazzarella indicated there were no major
changes to the exterior of the building or exterior cladding materials. The basement has been
eliminated to save costs and the total unit count is 50 units. Mazzarella indicated that he would
offer the units for homeownership after 15 years, but that no tenants would be dislocated by the
offering. He emphasized that the project details are still subject to change to make a feasible and
competitive funding application. He emphasized that the project also has to be satisfactory to tax
credit investors.
IURA Minutes
12/17/10
Page 7 of 12
Discussion
Peterson asked if there are changes to the project will it come back to the IURA for review and
approval. Mazzarella indicated that he would bring the project back for IURA endorsement if there
are any major changes, including any change in the income mix of the tenants.
Cummings asked if tenants who initially qualify as income‐eligible can remain if they become over‐
income. Mazzarella answered that they can remain, but their rent may increase up to 30% of their
income.
Peterson asked about the length of the affordability period. Mazzarella explained that there is a
30‐year minimum affordability period, but to be competitive for funding, a commitment to keep
the housing affordable for a 50‐year term is necessary. He noted that after 30 years, it is his
understanding that the 1st floor and parking areas could be modified to include commercial uses so
long as the project continued to provide 50 affordable housing units.
After reviewing and modifying the draft resolution, Farrell moved, seconded by Dylla:
HODAG Loan Approval to INHS for the Breckenridge Place Project
1. WHEREAS, on December 15, 2010 Ithaca Neighborhood Housing Services (INHS) submitted a
funding request of $800,000 in assistance from the Housing Development Action Grant (HODAG)
proceeds administered by the Ithaca Urban Renewal Agency (IURA) for a proposed $15 million
downtown affordable housing project, located at 100 W. Seneca Street, the current site of the
Women’s Community Building, and
2. WHEREAS, the proposed project consists of construction of 50 one and two bedroom apartment
units for moderate‐income (up to 90% of median household income), low‐income (up to 60% of
median household income) and very‐low‐income (up to 50% of median household income) renters
and a community room, and
3. WHEREAS, INHS has indicated that these apartments could be sold as condominiums after 15 years
and the IURA endorses the offering of these as for sale units when the regulatory conditions allow,
and
4. WHEREAS, INHS is applying for primary funding assistance for the project from the Low Income
Housing Tax Credit (LIHTC) program and the New York State Housing Trust Fund (HTF) through New
York State’s Homes and Community Renewal’s (HCR’s) FY 2011 Unified Funding Round and both
funding sources increase project scoring for applications that demonstrate local support, including
direct financial assistance, and
5. WHEREAS, the City has previously allocated $200,000 in HOME funds to this project as part of the
IURA recommended and City adopted 2010 Action Plan, and
6. WHEREAS, the IURA administers the HODAG proceeds fund, which had an unobligated balance of
approximately $393,000 as of January 1, 2007, and
IURA Minutes
12/17/10
Page 8 of 12
7. WHEREAS, the total of the current unobligated balance and the repayment of the outstanding INHS
loan exceed the current HODAG loan request amount, and
8. WHEREAS, there is currently an outstanding HODAG loan to INHS with a principal balance of
approximately $638,000 which would be repaid as a condition of any new HODAG loan approval,
making these funds available to re‐loan to the Breckenridge Place project, and
9. WHEREAS, by IURA policy, the HODAG proceeds are to be used to make loans to assist affordable
rental housing projects that will be repaid to recapitalize the fund to enable the IURA to make
additional loans for affordable housing projects, and
10. WHEREAS, per the December 15, 2010 letter INHS has requested that the loan from HODAG
proceeds to assist the project with principal and interest repayable at 2% interest with a 30‐year
term, and
11. WHEREAS, the City of Ithaca Planning & Development Board, acting as lead agency for
environmental review of the Project, has completed environmental review and determined that the
Project will result in no significant impact on the environment; and
12. WHEREAS, the Neighborhood Investment Committee discussed the loan request at their November
19, November 22, and December 9, 2010 meetings; now, therefore, be it
1. RESOLVED, the IURA hereby approves a total funding commitment to the project of $1 million,
including the 2010 HOME funds previously allocated, and be it further
2. RESOLVED, that the IURA hereby approves a loan to Ithaca Neighborhood Housing Services (INHS)
subject to the following terms and conditions:
Loan Amount: up to $800,000.00.
Use of Funds: the construction and operation of the Breckenridge Place Project, a 50‐
unit affordable rental housing project located at 100 W. Seneca Street,
Ithaca, NY.
Source of Funds: Loan proceeds derived from the 1984 HODAG ‐ #NY009HG401,
“Eddygate Park Apartments” project.
Interest Rate: 2% annual rate
Term: 360 months
Borrower: Ithaca Neighborhood Housing Services (INHS) or an entity controlled by
INHS.
Repayment: Principal and interest payments due monthly based on a 30‐year
amortization schedule – approximate monthly payment of $2,218.
IURA Minutes
12/17/10
Page 9 of 12
Collateral: 3rd mortgage on the project property behind only a 1st mortgage held
by the project’s commercial lender and a 2nd mortgage held by the New
York State Housing Trust Fund.
Conditions: 1) Loan commitment is contingent upon submission of evidence by
October 1, 2011 of sufficient funding awarded to the Project through
the NYS Division of Home and Community Renewal FY 2011 Unified
Funding round to complete the project, and
2) Repayment of the INHS Rental Housing Refinancing Loan (HODAG,
#11) with a current outstanding principal balance of approximately
$638,000, and be it further
Loan #2 Amount: up to $200,000.00.
Use of Funds: the construction and operation of the Breckenridge Place Project, a 50‐
unit affordable rental housing project located at 100 W. Seneca Street,
Ithaca, NY.
Source of Funds: Loan proceeds derived from the 1984 HODAG ‐ #NY009HG401,
“Eddygate Park Apartments” project.
Interest Rate: 2% per annum
Term: 360 months
Borrower: Ithaca Neighborhood Housing Services (INHS) or an entity controlled by
INHS.
Repayment: All principal and interest shall be deferred until the end of the loan
term.
Collateral: 4th mortgage behind only a 1st mortgage held by the project’s
commercial lender, a 2nd mortgage held by the New York State Housing
Trust Fund and a 3rd mortgage held by the Ithaca Urban Renewal
Agency for the above referenced loan.
Conditions: 1) Loan commitment is contingent upon submission of evidence by
October 1, 2011 of sufficient funding awarded to the Project through
the NYS Division of Home and Community Renewal FY 2011 Unified
Funding round to complete the project, and
2) Repayment of the INHS Rental Housing Refinancing Loan (HODAG,
#11) with a current outstanding principal balance of approximately
$638,000, and be it further
3. RESOLVED, that the amount of HODAG loan funds shall be decreased by the amount of HOME
funding allocated to the project through the 2011 Action Plan, if any, and be if further
IURA Minutes
12/17/10
Page 10 of 12
4. RESOLVED, that the IURA Chairperson, upon the advice of IURA Counsel, is hereby authorized to
execute all necessary and appropriate documents to implement this resolution, including, but not
limited to, executing loan agreement documents.
Amending Resolution #1
Farrell moved, seconded by Dylla, to modify the Whereas clause #2 to read as follows:
“WHEREAS, the proposed project ideally consists of construction of 50 one and two bedroom
apartment units for moderate‐income (up to 90% of median household income), low‐income (up to
60% of median household income) and very‐low‐income (up to 50% of median household income)
renters and a community room, and”
Amendment #1 Carried 3‐1 (Cummings opposed)
Amending Resolution #2
Dylla moved, seconded by Farrell, to modify the Whereas clauses # 10 and #12 to read as follows:
“WHEREAS, INHS has requested funding from HODAG proceeds to assist the project, and”
“WHEREAS, the Neighborhood Investment Committee discussed this project at their November 19,
November 22, and December 9, 2010 meetings; now, therefore, be it”
Amendment #2 Carried 3‐1 (Cummings opposed)
Table Main Motion
Farrell moved, seconded by Cummings, to table the resolution.
Motion to Table Carried 4‐0
Resolution ‐ NI correspondence dated 12/17/10 to INHS
Farrell moved, seconded by Cummings, that the IURA supports the draft December 17, 2010
letter prepared by the NI Committee identifying items that should be incorporated into the
project if feasible, and authorizes the letter be sent to INHS.
Motion Carried 3‐1 (Peterson opposed)
Peterson explained that she opposed the specificity of some design recommendations in the letter
(attached to minutes), particularly the section of the letter seeking to have dishwashers in each
unit.
Remove Main Motion From Table
Farrell moved, seconded by Dylla, to remove the motion from the table.
Motion Carried 4‐0
Main Motion as Amended
A vote on the Main Motion as Amended resulted as follows:
Carried Unanimously (4‐0)
E. Committee Chairperson report – none
IURA Minutes
12/17/10
Page 11 of 12
VII. Governance Committee
A. HUD Annual Community Assessment, fiscal year 2009‐2010 – the Agency reviewed the
assessment.
B. Review of October & November 2010 IURA financials – Bohn reviewed the financials and reported
that all loans are current except for Diane’s State Street Auto, Inc. A meeting with this borrower
has been scheduled for late December, he reported.
C. Committee Chairperson report – Cummings reported that Finger Lakes Technology has extended
fiber optics at the Cherry Street Industrial Park down to the Precision Filters building.
VIII. New/Old Business
A. IURA Chairperson Report ‐ none
B. Staff Report ‐ none
C. Other New/Old Business
Moved by Peterson, seconded by Cummings:
Appreciation for Wies Van Leuken
Whereas, Ms. Wies Van Leuken has announced her retirement from the Ithaca Urban Renewal
Agency (IURA) after more than 21 years of service that began in 1989, and
Whereas, in her role as Contracts Monitor she has been responsible for drafting grant and loan
agreements, tracking project progress and compliance with funding conditions, reporting project
outcomes, and many, many other administrative duties, and
Whereas, she has developed and monitored over 375 separate funding agreements for projects
addressing community development needs, and
Whereas, she single‐handedly established the entire IURA filing system, and
Whereas, her reliability, commitment, attention to detail, and meticulous filing and record‐keeping
is legendary in City Hall, and
Whereas, during more than a dozen monitoring visits of IURA programs by HUD representatives,
there has never been a shortcoming identified in her contracts, files or reports, and
Whereas, her behind‐the‐scenes work has been absolutely critical to the IURA’s success; now,
therefore, be it
RESOLVED, that the IURA hereby thanks Wies Van Leuken for her extraordinary work for the
Agency and recognizes her important contribution to the Agency’s achievements to assist low‐
income persons and address community development needs; and be it further
RESOLVED, that the IURA wishes her a happy and healthy retirement.
Carried Unanimously
IURA Minutes
12/17/10
Page 12 of 12
IX. Motion to Adjourn
The meeting was adjourned by consensus at 11:15 a.m.
END
Minutes prepared by A. Vargo, edited by N. Bohn
j:\community development\admin files\minutes\iura\2010\12december\12‐17‐10 iura nb edit revised.doc