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HomeMy WebLinkAbout11-02-16 Common Council Meeting AgendaOFFICIAL NOTICE OF MEETING AGENDA PLEDGE OF ALLEGIANCE: ADDITIONS TO OR DELETIONS FROM THE AGENDA: PROCLAMATIONS/AWARDS: SPECIAL ORDER OF BUSINESS: SPECIAL PRESENTATIONS BEFORE COUNCIL: PETITIONS AND HEARINGS OF PERSONS BEFORE COUNCIL: PRIVILEGE OF THE FLOOR – COMMON COUNCIL AND THE MAYOR: CONSENT AGENDA ITEMS: City Administration Committee: CITY ADMINISTRATION COMMITTEE: PLANNING AND ECONOMIC DEVELOPMENT COMMITTEE: REPORTS OF SPECIAL COMMITTEES: NEW BUSINESS: INDIVIDUAL MEMBER – FILED RESOLUTIONS: MAYOR’S APPOINTMENTS: REPORTS OF COMMON COUNCIL LIAISONS: REPORT OF CITY CLERK: REPORT OF CITY ATTORNEY: MINUTES FROM PREVIOUS MEETINGS: ADJOURNMENT: CONSENT AGENDA ITEMS: City Administration Committee: Donation of Skate Park Lighting System to the City of Ithaca - Resolution RESOLVED RESOLVED RESOLVED SECOND ADDENDUM Youth Bureau – Request to Amend 2016 Budget - Resolution RESOLVED, Ithaca Youth Bureau 1 James L. Gibbs Drive Ithaca, New York 14850 Phone: (607) 273-8364 Fax: (607) 273-2817 “Building a foundation for a lifetime.” Increase expenses: Increase revenues: Increase Expenses: Increase Revenues: Attorney – Request for Funds for Litigation and Legal Fees - Resolution RESOLVED Approval of the 2016-2017 Civil Service Agreement with the Ithaca City School District - Resolution RESOLVED BACK-UP ITEM 8.4 AGREEMENT WITNESSETH: CITY ADMINISTRATION COMMITTEE: Adoption of 2017 Budget – Resolution RESOLVED, RESOLVED, Adoption of 2017 Tax Rate – Resolution RESOLVED, RESOLVED, RESOLVED, RESOLVED, RESOLVED, Adoption of 2017 Ithaca Area Wastewater Treatment Plant Budget - Resolution RESOLVED, RESOLVED, A Local Law Entitled “Confirmation of the Sidewalk Improvement District Assessments, Budget, and Schedule of Work for Fiscal Year 2017” LOCAL LAW 2016- BE IT ENACTED Section 1. Section 2. Section 3. Section 4. Engineering – Approval of a Transportation Alternatives Program (TAP) Grant Application - Resolution RESOLVED TO: FROM: DATE: RE: ENCLOSURE: The Hector Street Sidewalk       PLANNING AND ECONOMIC DEVELOPMENT COMMITTEE: Authorize Commitment Letter to Receive Grant Funds to Support the Ithaca Neighborhood Housing Services (INHS) Scattered Site Preservation Project – Resolution RESOLVED RESOLVED October 6, 2016 Mr. Nels Bohn Director of Community Development City of Ithaca 108 East Green Street Ithaca, NY 14850 RE: Request for the City of Ithaca to Accept New York State Housing Stabilization Funds Dear Ms. Bohn: INHS has the opportunity to take advantage of grant dollars from a settlement agreement between Morgan Stanley and the New York State Attorney General. The settlement funds are being administered by the Local Initiatives Support Corporation (LISC) through a fund it has established called the New York State Housing Stabilization Fund (NYSHSF). The terms of the settlement require that the funds be granted to a municipality for a particular project. INHS is requesting that the City of Ithaca accept these funds and then grant them to INHS for the Scattered Site Project. The Scattered Site Project includes 98 units in 44 buildings – all located within the City of Ithaca – that would be renovated to improve the quality of life for tenants, improve energy efficiency and preserve this stock of affordable housing for 50 fifty years. Attached is a more detailed description of the project and how the financing will work to leverage an additional 15 million dollars in Tax Credit and New York State Housing Funds. If you have any questions please do not hesitate to contact me. Sincerely, Joseph L. Bowes Director of Real Estate Development 1 INHS Scattered Site Project Description Over the past 30 years INHS has acquired or constructed 153 units within the City of Ithaca (aka the “INHS Scattered Site Portfolio”). The properties are located in the Southside, West Hill and Northside Neighborhoods. All of the buildings are over 20 years old and the majority were constructed over 100 years ago. The entire portfolio is located in close proximity to services, employment, public transportation and downtown amenities. The INHS Scattered Site Portfolio is affordable because INHS’s mission is to provide affordable housing. To accomplish this mission rents have been set below market. Only a small fraction of the units have any type of housing regulatory agreement requiring affordability even though the portfolio represents one of the largest affordable housing portfolio’s in the City and provides housing for more than 70 Housing Choice Voucher holders. Approximately 80% of the families living in these apartments earn less than 60% of the Area Median Income (AMI). While this housing serves those most in need it also is home to 17 more moderate income families. INHS will retain this income mix in any refinance and work to ensure that no tenants are permanently displaced as part of the project. A consequence of maintaining low rents and keeping the Portfolio affordable is that there is often not enough money to do the repairs that are needed. Over the years, as the Scattered Site portfolio has grown and the structures have aged, the buildings have become difficult to manage. In many cases only the most pressing maintenance needs are addressed while the more critical large capital expenditures like roofs, siding and energy efficiency upgrades delayed. Renovating and refinancing the Portfolio provides a unique opportunity to permanently restrict these units as affordable housing and create high quality energy efficient housing in one of the strongest housing markets in Upstate, NY. Refinance Plan INHS has the opportunity to take advantage of State and Federal funding for Low Income Housing to renovate and refinance this Portfolio. This financing would be combined with funding from INHS and grant dollars from a settlement agreement between Morgan Stanley and the New York State Attorney General. The settlement funds are being administered by the Local Initiatives Support Corporation (LISC) through a fund it has established called the New York State Housing Stabilization Fund (NYSHSF). The terms of the settlement require that the funds be granted to a municipality for a particular project. INHS is requesting that the City of Ithaca accept these funds and then grant them to INHS for the Scattered Site Project. 2 INHS will use the funds to acquire the properties, pay off existing debt, renovate the buildings and pay for the associated costs such as architecture and engineering. The majority of the properties are debt free; however, a small number are encumbered by a $1.8 million conventional loan. One property has a $50,000 NYS Housing Trust Fund mortgage and one has a $350,000 HOME Mortgage. INHS owes $90,000 to the Ithaca Urban Renewal Agency which will be paid back through the refinance. The goals of the refinance include: improve the quality of life for INHS tenants, permanently restrict the units as affordable housing, improve the energy efficiency of the portfolio to reduce greenhouse gases and cost of utilities, capitalize reserves to mitigate ongoing maintenance and operating risk, and invest equity from the sale of the portfolio into the development of new affordable housing. Scope of Work & Development Team The refinance would include renovating each building based on a recently completed Capital Needs Assessment that evaluated roofs, windows, insulation, siding, kitchens, baths, carpeting, flooring, heating systems, and cosmetics. Floor plans, elevations, and a detailed scope of work have been created for each building and unit. INHS has retained SWBR Architects to provide architectural services and 2+4 Construction as the General Contractor. Both have extensive experience with occupied renovation projects. 2+4 has devised a construction schedule that limits relocation as much as possible; however, INHS is committed to hiring a Relocation Manager to oversee the tenant relocation process. INHS would continue as the property manager and be the Sponsor. INHS will form a wholly owned subsidiary to be the managing member, a wholly owned Housing Development Fund Corporation to own the land and a Limited Liability Company along with an investor member to own the project. INHS staff have extensive experience developing and managing tax credit properties and overseeing occupied rehabs. Sale Proceeds As part of the refinancing INHS will earn equity from the sale of the portfolio into a Limited Liability Corporation. The equity from this refinance will be reinvested into INHS’ mission of creating additional affordable housing. At its September 15th Board of Directors Meeting the INHS Board affirmed its intention to reinvest funds from the acquisition and development of the Scattered Site Portfolio into its real estate development mission by expanding its capacity to do additional housing development in its service area. Examples of how these funds will be used include investments in predevelopment, permanent sponsor loans, and/or acquisition financing for additional affordable developments. To date, INHS has invested over $1 million in acquisition and sponsor loans in the development of 183 units of 9% Low Income Housing Tax Credit projects. This investment has leveraged over $50 million in investment from Tax Credit Equity, State, Local, and Federal funds. INHS plans to continue to make this type of investment in affordable housing over the next decade and the equity generated from this project is a key component in that strategy. 3 Sources and Uses Summary** Uses Total Land/Building $6,860,000 Soft Costs & Fees $4,854,912 Hard Costs $6,471,479 Contingency $652,329 Reserves $286,289 Working Capital $100,000 Total $19,225,631 Sources Construction Permanent Bond $10,175,631 $3,874,773 Tax Credit Financing $2,500,000 $5,281,833 NYS Subsidy Funds $2,000,000 INHS Funds & Equity $3,769,025 $3,769,025 Tompkins County CHDF $ 300,000 $ 300,000 LISC Morgan Stanley $4,000,000 $4,000,000 Total $19,225,631 $19,225,631 **Note this is a draft budget subject to change. Refinance Schedule a.Capital Needs Assessment ...............................…………………………………complete b.Finalize Scope of Work ......................................…………………………………complete c.Finalize Costing .................................................…………………………………October 2016 d.Application to Tompkins County ......................…………………………………October 2016 e.Application to HFA ............................................…………………………………November 2016 f.Finalize Development/Operating Budget .........…………………………………November 2016 g.INHS Board and Committee Approval ..............…………………………………November 2016 h.Ithaca Common Council Acceptance of Morgan Stanley Funds…………November 2016 i.LISC Agreement Executed………………………………………………………………….December 2016 j.Close on Financing ............................................…………………………………April 2017 k.Renovations Complete ......................................…………………………………December 2018 4 Portfolio Characteristics Unit Mix BRs Units No. % Studio 16 12% 1 BR 23 29% 2 BR 28 25% 3 BR 28 24% 4 BR 3 2% Commercial 0 8% 98 Current Incomes Served Income Units % 50% AMI 22 22% 60% AMI 59 60% > 60% AMI 17 18% 98 100% Age of the Housing Stock Buildings Units Age 56% 29% 1900 17% 12% 1901 - 1940 6% 4% 1941 - 1978 21% 55% 1979 - present 5 Location The properties are located throughout the City’s downtown and West Hill neighborhoods. Grant Amount; Purpose of the Grant: , Grant Commitment: Please note - this Grant Agreement must be signed and returned to LISC within thirty (30) days after the date of this Grant Agreement. If such deadline passes, LISC reserves the right to withdraw this Grant Agreement and reprogram the funds. LOCAL INITIATIVES SUPPORT CORPORATION TERMS OF GRANT ACCEPTED AND AGREED TO: [NAME OF GRANTEE] Attachment A Description of Affordable Rental Housing Project Consideration of Common Council Conditional Approval for Maguire at Carpenter Business Park Application for Temporary Mandatory Planned Unit Development (TMPUD) – Resolution Ithaca Journal RESOLVED An Ordinance to Amend Chapter 325 of the City of Ithaca Municipal Code entitled “Zoning” and Chapter 210 of the City of Ithaca Municipal Code entitled “Housing Standards” in order to Add a Zoning Definition for “Mezzanine,” Amend the Housing Standards Definition of “Mezzanine,” and Amend the Zoning Definition of “Story” New York State Uniform Fire Prevention and Building Code ORDINANCE 2016- BE IT ORDAINED AND ENACTED Section 1. New York State Uniform Fire Prevention and Building Code New York State Uniform Fire Prevention and Building Code Section 2. MEZZANINE An intermediate level or levels between the floor and ceiling of any space as defined in the New York State Uniform Fire Prevention and Building Code. Section 3. Section 4. A mezzanine as defined in the New York State Uniform Fire Prevention and Building Code is not a story. Section 5. Section 6. M E M O R A N D U M shall not shall Resolution Urging the United States Congress to Pass Carbon Fee and Dividend Legislation RESOLVED, CARBON FEE AND DIVIDEND LEGISLATION - FREQUENTLY ASKED QUESTIONS From Citizens’ Climate Lobby website http://citizensclimatelobby.org/carbon-fee-and-dividend/ Why is a carbon fee and dividend necessary? This legislation will put us on the path of a sustainable climate by reducing our greenhouse gas emissions and transitioning us to a clean energy economy. Since the beginning of the industrial revolution we have increased the level of greenhouse gases, especially carbon dioxide (CO2), in our atmosphere. Scientists warn that this is having a drastic effect on our climate. Changes that would normally take thousands of years are happening in decades. Current concentrations of heat-trapping CO2 are higher than at any time in the entire history of the human species on Earth. In effect, we have covered the Earth with a large blanket of greenhouse gases and the Earth is warming up. The oceans are absorbing this increased carbon dioxide in the atmosphere, making them more acidic. Eventually, this acidity will affect the oceans’ ability to support life. What is a carbon fee? It is a fee based on the amount of carbon in a fossil fuel. Fossil fuels such as oil, gas and coal contain carbon. When burned they release the potent green house gas, carbon dioxide (CO2), into the atmosphere. The fee is based on the tons of carbon dioxide the fuel would generate, and it would be collected at the earliest point of entry into the economy — well, mine or port. The fee would start out low — $15 per ton — and gradually increase $10 each year. What is the difference between a tax and a fee? A tax has the primary purpose of raising revenue. By contrast, a fee recovers the cost of providing a service from a beneficiary. Since the CCL advocates for revenue-neutrality and a policy that doesn’t grow the government, we are advocating for a fee, not a tax. However, for purposes of discussion you will find carbon tax and carbon fee used interchangeably, and referring to the same type of legislation. This is fine, and don’t let it get in the wa y of the discussion. The tax or fee do the same thing, which is to include the damage that carbon is doing to our climate, oceans, and health in the price. How much would the carbon fee affect energy prices? The best example would be gasoline. A $1 per ton increase in the carbon fee would equal about 1 penny on the price of gas. So if the carbon tax started at $15/ton, gasoline would go up by about 15 cents per gallon the first year and 10 cents each year afterward. How does carbon fee and dividend legislation work? Carbon Fee and Dividend legislation puts a fee on the amount of carbon dioxide in fossil fuels. This fee is assessed at the source of the fuel: at the mine, well, or port of entry. The fee starts out low and increases annually in a predictable manner until we reach a safe level of emissions. The fee is collected exclusively at the first point of sale, and 100 percent of the revenues are reimbursed directly to all American households, shielding them from the financial impact of the transition to a clean energy economy. Because the fee (and the price of fossil fuel) goes up predictably over time, it sends a clear price signal to begin using fossil fuels more efficiently or replace them with low emissions energy. That price signal motivates investment to move into low emissions technologies, as the true cost of fossil fuels is brought back onto the balance sheets of those who sell them. The rising cost of fossil fuels increases the demand for low emissions products, making them even less expensive as they reach mass production. This clear and easy-to-understand price signal (increasing fossil fuel costs and decreasing green technology costs) drive the transition to a green economy. This transition will reduce greenhouse gas emissions, stabilizing our climate and the health of our oceans. Why a dividend? Academic studies that consider the economic effect of a revenue-neutral carbon tax generally consider a dividend less beneficial (but still very beneficial) than a tax-swap [8]. A tax-swap means using the revenue to reduce any combination of payroll, income, or corporate taxes. However, these studies also say that though these tax-swap policies, especially corporate tax- swaps, result in a marginally larger economy, extra measures would have to be implemented to help the poor, because none of these tax-swaps will help the unemployed; including millions of retirees. Because CCL values simplicity and transparency, because economists say the poor must be taken care of, because the difference in economic efficiency is marginal, and because a dividend will still boost the economy when health and climate benefits are accounted for, the CCL advocates for the only revenue return mechanism that reaches every American. Reaching everyone is indispensable for the success of any carbon price because when gas is $1.00 per gallon more expensive (year 10 in CCLs policy) [1], the poor will not be able to afford it with any of the tax-swap mechanisms of return, and the bill would be repealed. Only a dividend can simply, transparently, and fairly help everyone afford the price increases, ensuring support of the policy until we have restored the climate, and giving the Main Street economy time to adjust. Won’t it be expensive to impose the fee? No, for the two reasons listed below: 1)The administrative & enforcement cost of collecting and processing a carbon fee is proportional to the number of fossil fuel firms that pay the fee. Collecting a carbon fee from a few hundred fee-payers, at a point where the fossil fuels enter the economy, is a relatively simple and low-cost activity. [Calder2015] and [Metcalf2009] suggest that — to keep the number of taxpayers to an absolute minimum — petroleum, coal, and gas fee collection be considered separately. A) There are far fewer petroleum refineries than petroleum well-heads, and the refineries are owned by fewer than 150 petroleum firms. It is these 150 firms that should be required to measure the output at their refineries and pay the fee.
B) The approximately 1,500 U.S. coal mines are owned by between 500 and 800 coal producers. It is these producer firms that should be required to measure the output at their coal mines and pay the fee. There are four grades of coal, each of which has a slightly different carbon content, and therefore requires a different fee.
C) There are over 450,000 natural gas wells in the U.S., but only 500 natural gas processing plants. It is the processors that should be required to measure their output and pay the fee. An additional advantage of collecting fees from processors (and refineries in the case of petroleum) is that the carbon content of processed outputs are easier to measure than unprocessed outputs.
The total count of fee-payers is then between 1200 and 1500, a conveniently small, low-cost number. 2)According to [Calder2015], “… use of existing tax mechanisms is probably the key advantage of upstream taxation”. An ‘excise’ is an existing tax mechanism assessed on a transaction to pay for a particular expense, and is most likely the least cost model for our new upstream carbon fee. The U.S. Internal Revenue Service has for years collected a per-ton excise from coal producers [IRS2005] and deposited the proceeds into the Black Lung Disability Trust Fund. The IRS also collects an “environmental excise tax” from petroleum firms for oil spill liability [IRS1993]. The excise procedures used to assess, collect and enforce these taxes could be extended and refined to assess an upstream carbon fee on the 1200-1500 fossil fuel firms described in 1 above. The carbon fee program could then be managed by existing IRS staff with perhaps some incremental hiring. [Calder2015] tells us that a carbon fee could assess, “different rates for different fuel types, [and] possibly credits or refunds for non-combustion uses”. Coal producers and petroleum firms are well-prepared to pay a carbon fee because they already measure their output and pay taxes on their fossil fuel sales. The IRS will have to extend the new carbon fee procedures to natural gas processors, and natural gas processors will have to measure their output (if they don’t already), calculate the carbon content of each output, and then determine their applicable carbon fees. How is this legislation fair to businesses, utilities, manufacturers, and farms? By giving all of the carbon tax back to households — the end users — consumers will be able to pay the higher prices of goods and services caused by the higher price of fossil fuels. This allows businesses to pass along the increased cost and keep market share. Each year the carbon tax goes up, the dividend goes up as well. Everyone is on a level playing field for the first few years. But if businesses do not become more energy efficient and start converting to low-emissions energy, they will become less competitive and lose market share. These market forces will drive innovations in low-emissions technology, creating new business opportunities to develop, produce, install and service these products. This will create millions of new jobs here in America. American companies will be able to sell these technologies globally and American companies will become more efficient with the energy they use, making them more competitive worldwide. Why will citizens change to low-cost emissions technologies if they are given a dividend to pay for the increasing cost of fossil fuels? With Carbon Fee and Dividend legislation, it is clear to citizens that prices for fossil fuels will go up every year. Part of their motivation is to save as much of their dividend check as possible rather than spending it on more expensive fossil fuels. They can do this by changing over to energy efficient lighting and appliances, upgrading their insulation or windows, replacing that old oil furnace with a geothermal heat pump, etc. When it comes time to get another vehicle, they would consider one that gets better gas mileage or an all-electric vehicle. They can then buy clean electricity (where available) through their utility to charge their car, getting them off fossil fuels altogether. The motivation is to reduce cost in the years to come. The same is true for investors and for fossil fuel companies: as the fee increases, and the cost of doing business rises with it, the rising dividend will ensure that the true cost of doing business will be paid by those in that business. How will our manufacturers remain competitive? The CCL legislative proposal calls for placing a border adjustment levy on all imports from countries that do not price carbon similarly, giving no company an incentive to move production to a country that allows them to pollute more at lower cost [2]. Because the US consumer economy is so much more valuable than any other in the world, foreign countries that export heavily to the US will likely choose to institute a similar carbon price, to avoid sending huge amounts of capital to the US. Either way, US and foreign manufacturers will lose no ground economically for producing products with a lower carbon footprint. Additionally, the legislative proposal calls for rebating the border adjustment fee to American companies exporting to countries without similar carbon pricing, leveling the playing field for our companies and complying with the World Trade Organization (WTO). Why a border adjustment? Though many other countries have carbon prices in some form, none of these are a match for the physics of the climate, and none employ a border adjustment. Without a border adjustment, both American exporters and foreign importers would find themselves with an incentive to relocate production to countries with a more relaxed regime, polluting more for the same good. This is called “leakage”. In the interests of the climate, it is therefore necessary to refund the carbon fee on goods exported and impose a carbon fee on carbon intensive goods imported. While there are widespread concerns about how such a border adjustment could be compatible with World Trade Organization (WTO) law, these concerns are ill-founded. WTO experts have written documents explaining how this could be achieved, and it is clear that the CCL proposal is consistent with the requirements these experts outline [2]. Why will the adoption of Carbon Fee and Dividend legislation put American in the leadership position on climate change? Because of the carbon fee border adjustments, exporting countries will either adopt similar carbon pricing, or pay at our border. All countries that adopt similar taxes on carbon are on the same level playing field and can make border adjustments with countries that do not adopt such taxes. This encourages all countries to place similar taxes on carbon. As more nations adopt carbon taxes, worldwide demand brings the best green technologies to mass market faster, driving down costs and making the transition to a green economy less expensive for everyone.