HomeMy WebLinkAboutMN-IURA-2010-01-28Approved
3-25-10
108 East Green Street
Ithaca, New York 14850
(607) 274-6559
MINUTES
IURA
January 28, 2010
Present: Carolyn Peterson, Doug Dylla, Susan Cummings, Tracy Farrell
Others: J.R. Clairborne, Common Council Liaison
Staff: Nels Bohn, Sue Kittel, Alice Vargo
Guest: Paul Mazzarella, Executive Director of Ithaca Neighborhood Housing Services (INHS)
I. Call to Order
The meeting was called to order at 8:35 by Chairperson Peterson.
II. Additions to or deletions from the Agenda – Bohn requested the addition of procurement for contract
review/compliance services as agenda item VIIIB. Peterson requested adding the proposed R-3aa zoning
district as agenda item VID. There were no objections to the agenda additions.
III. Public comment - None
IV. Approval of Meeting Minutes:
By Farrell, seconded by Cummings, motion to approve October 22, 2009 minutes with corrections.
Carried Unanimously.
By Dylla, seconded by Cummings, motion to approve October 29, 2009 minutes (continuation of
October 22, 2009 meeting) with corrections. Carried Unanimously.
By Cummings, seconded by Farrell, motion to approve November 13, 2009 minutes (2md
continuation of October 22 2009 meeting) with corrections. Carried Unanimously.
By Farrell, seconded by Dylla, motion to approve December 17, 2009 minutes with corrections.
Carried Unanimously.
V. Special Order of Business - INHS Community Housing Trust Program (CHT), Paul Mazzarella,
Executive Director, INHS - Report and Q&A.
Paul Mazzarella provided a summary of the INHS Community Housing Trust program designed to help
people with modest incomes buy their first homes and ensure that the homes remain affordable upon resale
through a shared equity model. He noted that the three major goals of the program are:
1) To help people to become home owners, who could not afford to because of income level.
2) Maximize use of public subsidies.
3) Ensure homes assisted are permanently affordable and available to low income families.
Ithaca
Urban
Renewal
Agency
IURA Minutes
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Mazzarella reviewed the major features of the ground lease, a comparison of income needed for a market
rate home purchase versus a Community Housing Trust purchase, and examples of how the resale formula
works. He noted that INHS has the first six houses for sale now through the CHT.
S. Kittel left the meeting at 9:15 A.M.
J.R. Clairborne arrived at 9:25 A.M.
VI. Neighborhood Investment Committee
A. Request from INHS for short-term loan assistance from HODAG proceeds.
By Farrell: second by Cummings
Predevelopment Loan Assistance to INHS for an Affordable Rental
Housing Project at 100 West Seneca Street
WHEREAS, on January 6, 2010, Ithaca Neighborhood Housing Services, Inc. (INHS) submitted a
request for short term loan assistance of $150,000 for predevelopment assistance for the so-called
“Women’s Community Building project” located at 100 West Seneca Street, Ithaca, NY, as part of their
plan to recapitalize its lending programs for first time homebuyers, and
WHEREAS, INHS and its development partner, Pathstone Corporation, seek to construct a 52-unit
affordable, rental housing project to be funded primarily through the Low Income Housing Tax Credit
program on the site of the Women’s Community Building, and
WHEREAS, INHS has secured site control of the project property, which is located within the City of
Ithaca Urban Renewal Project Boundary area, and
WHEREAS, the IURA administers the HODAG proceeds fund, which originally derived from the 1984
Eddygate Housing Development Grant (#NY009HG401), and had an unobligated fund balance of
$291,561 on December 31, 2009, and
WHEREAS, HODAG proceeds may be used to “support the construction, rehabilitation or operation of
real property to be used primarily for low and moderate income residential rental purposes,” and
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
WHEREAS, approval of the requested HODAG loan will allow INHS to direct other internal funds to
capitalize its loan programs, and
WHEREAS, the 2008 INHS financial audit prepared by Ciaschi, Dietershagen, Little, Mickelson &
Company, LLP showed INHS had assets of $12.6 million (including loans receivable of $6.4 million),
liabilities of $2.3 million, and net assets of $10.3 million, an increase of over $400K from the prior year,
and
WHEREAS, in-house December 31, 2009 INHS financial statements show net assets equal
approximately $10.1 million, of which over $1.6 million is temporarily tied up in 9 homes for sale or
homes under development for sale, and
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WHEREAS, at their January 8, 20010 meeting the IURA Neighborhoods Investment Committee
discussed this matter and recommended the following; now, therefore, be it
RESOLVED, the IURA hereby approves a predevelopment loan to INHS subject to the following terms and
conditions:
Loan Amount:
Up to $150,000.00
Borrower:
INHS
Source of Funds:
HODAG proceeds
Use of Funds: Predevelopment expenses for the 100 West Seneca Street
affordable rental housing project
Interest Rate:
2%
Term: 12 months
Repayment: Interest only due monthly until end of term when the full
principal balance shall be due and payable.
Security: Unsecured
Match: None
RESOLVED, that the IURA Director of Community Development is authorized to issue a loan
commitment in accordance with the terms of this resolution, and be it further
RESOLVED, that the IURA Chairperson, upon the advice of the and IURA Attorney, is hereby
authorized to execute all necessary and appropriate documents to implement this resolution, including,
but not limited to, executing loan agreement documents.
Approved Unanimously 4-0
Chair Peterson suggested switching Agenda item VI.B & C to accommodate Mazzarella. There was no objection.
B. Request from INHS for long-term loan assistance from HODAG proceeds to support the 100
West Seneca Street affordable housing project.
By Cummings: second by Farrell
Permanent Loan Assistance to INHS for an Affordable Rental
Housing Project at 100 West Seneca Street
WHEREAS, on January 25, 2010, Ithaca Neighborhood Housing Services, Inc. (INHS) submitted a
request for permanent loan assistance of $150,000 to partially fill a funding gap for the so-called
“Women’s Community Building project” located at 100 West Seneca Street, Ithaca, NY, and
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Page 4 of 8
WHEREAS, INHS and its development partner, Pathstone Corporation, seek to construct a 52-unit
affordable, rental housing project to be funded primarily through the Low Income Housing Tax Credit
program on the site of the Women’s Community Building (Project), and
WHEREAS, a funding gap of approximately $1.15 million has developed on the approximately $15
million project, and
WHEREAS, INHS proposes to fill the funding gap from the following sources:
$520,000 Federal Home Loan Bank
$250,000 Neighborworks
$150,000 IURA
$330,000 INHS/Pathstone equity/deferred developer fee
$1,150,000 Total
WHEREAS, INHS has secured site control of the Project property, which is located within the City of
Ithaca Urban Renewal Project Boundary area, and
WHEREAS, the IURA administers the HODAG proceeds fund, which originally derived from the 1984
Eddygate Housing Development Grant (#NY009HG401), and had an unobligated fund balance of
$291,561 on December 31, 2009, and
WHEREAS, HODAG proceeds may be used to “support the construction, rehabilitation or operation of
real property to be used primarily for low and moderate income residential rental purposes,” and
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
WHEREAS, the principal funding source for the project is the allocation of Low-Income Housing Tax
Credits for the project from the New York State Division of Housing & Community Renewal (DHCR)
through their annual unified funding round for which applications are due by February 11, 2010, and
WHEREAS, for a DHCR funding application to be competitive it must identify committed funds in
sufficient amount to fully fund the proposed project, and
WHEREAS, approval of the requested HODAG loan will enhance the competitiveness of the funding
application for the Project, and
WHEREAS, a permanent loan for the Project shall not be issued prior to full repayment of any IURA
predevelopment loan issued to INHS for the Project, and
WHEREAS, the IURA only became aware of the funding gap in recently and has not had the
opportunity to discuss this matter at the Neighborhoods Investment Committee, but strongly supports
the 100 West Seneca Street Affordable Housing project; now, therefore, be it
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Page 5 of 8
RESOLVED, the IURA hereby approves a loan to INHS subject to the following terms and conditions:
Loan Amount:
Up to $150,000.00
Borrower:
INHS, or a subsidiary entity controlled by INHS
Source of Funds:
HODAG proceeds
Use of Funds: Development of an affordable rental housing project at 100 West
Seneca Street
Interest Rate: 2%
Term: 30 years (360 months)
Repayment: Interest only payments due monthly with repayment of full principal
due and payable at the end of the loan term.
Security: 1. Subordinate mortgage on the project property located at 100
West Seneca Street
2. INHS corporate guarantee if borrower is a subsidiary entity of
INHS
Match: At least $770,000
Conditions: 1. Receipt by August 30, 2010 of proof that the DHCR funding
application for the project has been substantially approved.
2. Receipt of certification of INHS by 12/31/10 that sufficient
funding has been secured to complete the project.
3. Loan funds shall not be disbursed until INHS has repaid in full
any HODAG predevelopment loan for the project.
Reporting: Annual submission of audited financial statements for the project
and the borrower, including balance sheet and profit/loss statement.
Submission of documentation of match funding.
RESOLVED, that the IURA Director of Community Development is authorized to issue a loan
commitment in accordance with the terms of this resolution, and be it further
RESOLVED, that the IURA Chairperson, upon the advice of the and IURA Attorney, is hereby
authorized to execute all necessary and appropriate documents to implement this resolution, including,
but not limited to, executing loan agreement documents.
Approved Unanimously 4-0
C. Establish deadline for receipt of a complete response for Community Housing of Ithaca,
Inc. to the October 13, 2009 IURA request for information.
Farrell explained that concerns were raised about CHI’s capacity in the 2009 HUD monitoring visit and
that no response has been received to date to the IURA’s written request for information. She noted
that CHI has completed some successful projects recently and the IURA wants CHI to succeed, but the
issues raised in the IURA letter need to be addressed in a
IURA Minutes
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timely manner. Peterson suggested modifying the proposed resolution to set the deadline date for
receipt of materials to March 5, 2010, one week prior to the NI Committee meeting. `
By Farrell: seconded by Dylla
Establish Deadline for Receipt of Complete Response from CHI to
October 13, 2009 Request for Information (Project #4, 2009 HOME)
Whereas, at the monitoring visit by officials from the U.S. Department of Housing and Urban
Development in July of 2009 certain concerns regarding the operations of Community Housing of
Ithaca, Inc (CHI) were identified, and
Whereas, HUD staff made recommendations at that time about steps which could be taken to ensure
CHI’s compliance with all HUD regulations and ongoing success of the organization, and
Whereas, the Ithaca Urban Renewal Agency (IURA) directed staff to work with the IURA attorney to
develop a plan for addressing the concerns raised, and
Whereas, on October 13, 2009, a letter was issued to CHI outlining initial steps the organization needed
to take to address the issues, and
Whereas, that letter stipulated that the IURA “will not provide any further funding for CHI projects,
including the 421 Second Street renovation project ( project #4, 2009 HOME) until the requirements set
forth in the letter had been met, and
Whereas, these issues have not yet been addressed, and
Whereas, the IURA is desirous of ensuring timely use of HUD funds as well as ensuring the timely
resolution of the concerns outlines in the October 13, 2009 letter; now, therefore, be it
Resolved, that the IURA hereby directs staff to put Community Housing of Ithaca, Inc. on written notice
that the $38,425.00 of HOME funds reserved for, but not committed to, project # 4 of the 2009 Action
Plan (421 Second Street Renovation) will no longer be available for this project and these funds will be
made available for appropriate alternative projects undertaken by others if all requirements of the
October 13, 2009 letter are not met to the satisfaction of the IURA by the close of business on March 5,
2010, and be it further
Resolved, that the IURA retains the sole authority to determine whether all requirements of the letter of
October 13, 2009 have been met to the IURA’s satisfaction, based on application of HUD guidance &
regulations and advice of counsel.
Carried Unanimously 4-0
D. R-3aa Proposed Zoning District
Peterson noted that the City has been reexamining permitted development in the R-3 zoning districts
and she is concerned that current zoning could allow for large-scale buildings that could dramatically
change the fabric of the community and work against IURA goals for neighborhood stabilization,
retention of community character and expansion of home ownership. She noted that current R-3
zoning allows dormitories and sororities by right and does not put any limits on the size of buildings.
She noted that an ad-hoc committee including Alderpersons and representatives from the Planning
Board are conducting site visits to each R-3 zoning district and developing proposed zoning revisions.
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VII. Economic Development Committee
A. Report on strategic planning session
Dylla updated members on the Committee’s session that invited several local economic development
professionals to respond to a series of questions designed to help the IURA maximize the effectiveness
of its economic development programs, develop performance measurements and identify gaps in
economic development services. He anticipates that the Committee will continue its discussions and
report back to the IURA in future months.
VIII. Governance Committee
A. Review of IURA financials for December 2009
Bohn reviewed the financials noting the CDBG expenditure ratio is well within requirements. He noted
that State Theatre of Ithaca, Inc. and PB associates are showing up as past due on the loan repayment
report, though each of the borrowers report they are current. Staff is
researching the loan status with M&T Bank, the IURA loan servicing agent. All other borrowers are
current, Bohn reported.
B. Procurement – Contract Review/Compliance Services
Cummings stated that the staff proposes to procure an independent contractor on a temporary basis to
work on contracts monitoring assignments as a means to address a backlog of work and to help
understand how best to address contracts monitoring workload.
By Farrell: seconded by Dylla
Procurement –Contract Review/Compliance Services
WHEREAS, the Ithaca Urban Renewal Agency is in need of temporary professional services to ensure
timely monitoring and proper compliance with HUD Regulations for projects being implemented by
grantees, and
WHEREAS, IURA Staff have identified a person capable of performing such services on short notice
and with minimal training necessary to undertake this specialized work, and
WHEREAS, the adopted IURA budget for 2010 reflected the anticipated need for such services and
contains an allocation for this type of work, now therefore be it
RESOLVED, that IURA Chair is hereby authorized, upon review of the IURA Executive Director, to
execute an agreement to procure an independent contractor Rene Funke for contract
review/compliance services in an amount not to exceed $5,400.00, and be it further
RESOLVED, the source of such funds for legal services shall be derived from a variety of funding
sources, including, but not limited to, CDBG and HOME Entitlement funds, and expenses shall be billed
to the appropriate source of funds for which the legal work was performed.
During discussion of the motion Cummings asked about the independent contractor’s qualifications and
experience. Bohn reviewed her recent experience with Catholic Charities and Grassroots. Cummings
indicated an interest in further review of qualifications. Dylla noted that the contract is limited to the
equivalent of 15 weeks of work, so there is limited risk to the IURA. Bohn added that the contract
allows the IURA to terminate the agreement without cause at any time.
Approved 3-1 (Cummings opposed)
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C. Other
Cummings raised a concern that the developers for the IURA-assisted Ithaca Gun Factory
Redevelopment project have not formally committed to retain the iconic ‘Ithaca Guns’ smokestack.
Bohn noted that Travis & Travis Development LLC directed the property owner to retain the smokestack
during demolition activities and that they have indicated their preference to retain the smokestack as
part of their residential project, but the funding agreement does not obligate retention of the
smokestack. He added that the City has the right to exercise an option to acquire the smokestack
parcel at no cost as a condition of the funding agreement.
Cummings recommended the IURA send correspondence to the ILPC requesting they discuss efforts to
promote retention of the smokestack, including consideration for designation as a local landmark.
Members agreed to authorize the Chairperson to send such correspondence to the ILPC.
IX. New/Old Business
A. Chairperson Report – Peterson indicated she is interested to receive nominations to fill the vacant
IURA member position.
B. Staff Report
Bohn updated members on the NYSERDA Economic Efficiency and Conservation block grant (RFP
#10) application developed by IURA staff in conjunction with City Engineering staff, the Ithaca Gun
project, an application for directed appropriations in the federal budget and the Community Investment
Incentive program application by ItalThai, LLC undertaking an upper story housing project on the
Commons.
C. Next meeting date February 25, 2010
X. Motion to Adjourn
Dylla moved, seconded by Farrell, to adjourn the meeting. Carried Unanimously. Peterson adjourned the
meeting at 10:55 A.M.
END
Minutes prepared by A. Vargo, edited by N. Bohn.
j:\community development\admin files\minutes\iura\2010\1january\1january 1-28-10 nb edit.doc