HomeMy WebLinkAboutMN-IURA-2017-11-16Approved: 12/21/17
108 E. Green St.
Ithaca, NY 14850
(607) 274-6565
MINUTES
ITHACA URBAN RENEWAL AGENCY
Common Council Chambers, City Hall
8:30 A.M., Thursday, November 16, 2017
Members: Mayor Svante Myrick, Chair; Tracy Farrell, Vice‐Chair; Chris Proulx; Karl Graham;
Graham Kerslick (Common Council Liaison)
Excused: Eric Rosario
Staff: Nels Bohn; JoAnn Cornish; Anisa Mendizabal; Charles Pyott
Guests: None
I. Call to Order
Chair Myrick called the meeting to order at 8:35 A.M.
II. Agenda Additions/Deletions
No changes were made to the agenda.
III. Public Comment
None.
IV. Review of Draft Meeting Minutes: October 26, 2017
Farrell moved, seconded by Graham, to approve the October 26, 2017 meeting minutes, with
no modifications.
Carried Unanimously 4‐0
V. Economic Development Committee (EDC) Report
A. Restore New York Round 5 (NY5) Grant Application
Proulx recapitulated that the City of Ithaca/IURA solicited project proposals for inclusion in the
City’s Restore NY5 grant funding application to Empire State Development Corporation. Up to
$1,000,000 may be available to the City for redevelopment of abandoned, condemned, surplus, or
vacant building(s) in the urban core for residential, commercial, or mixed‐use. The Committee
originally recommended the following two projects (out of four applications) to the Mayor for
submission: “100s West” (121 W. State St., 123 W. State St., 108‐114 W. Green St.); and “Reach on
State Street” (310 W. State St.). Since the initial IURA recommendation, however, the “Reach on
State Street” project sponsor was unable to secure site control of the property, which was
subsequently acquired by another buyer who also seeks Restore NY financial assistance to
rehabilitate the historic structure for shared affordable housing.
Ithaca
Urban
Renewal
Agency
IURA Minutes
November 16, 2017
Page 2 of 8
Bohn added that the Ithaca Landmarks Preservation Commission (ILPC) reviewed the new 310 W.
State St. property owner’s carriage house proposal and indicated it would most likely be approved.
Moved by Proulx, seconded by Farrell:
Restore NY5 Funding Application
WHEREAS, the 2016‐17 New York State budget appropriated new funding for the Restore New
York’s Communities Initiative (“Restore NY5”) to revitalize urban areas and stabilize
neighborhoods and authorized the Empire State Development Corporation (“ESDC”) to
implement the program, and
WHEREAS, the goals of the Restore NY program are to (1) revitalize urban centers, (2) induce
commercial investment, and (3) improve the local housing stock, and
WHEREAS, Restore NY5 funding is available only for projects involving the demolition,
deconstruction, rehabilitation and/or reconstruction of vacant, abandoned, condemned or
surplus properties, and
WHEREAS, municipalities with populations under 40,000 are eligible to submit one project,
which may contain multiple related properties, not to exceed a request for $1,000,000 in
funding, and
WHEREAS, the Mayor requested the IURA to develop a RestoreNY5 proposal for consideration
by Common Council, and
WHEREAS, in response to a public call for proposals by the IURA, the following four projects
were submitted:
1. Ithaca Housing ‐ Redevelopment of the Green Street Garage, 120 E. Green Street;
2. Reach on State Street, 310 W. MLK, Jr./State Street;
3. Home Dairy/Yellow Deli Building, E. MLK, Jr./State Street;
4. 100s West, 121‐123 W. State Street and 108‐114 W. Green Street, and
WHEREAS, the IURA Economic Development Committee evaluated proposals to maximize
community benefit and competiveness for funding and recommended advancing the following
two projects for final consideration:
100s West
Reach on State Street (subject to securing site control), and
WHEREAS, the sponsor for the Reach on State Street project was unable to secure site control of
310 W. State Street, though the site was acquired by another buyer who also seeks Restore NY
financial assistance to rehabilitate the historic structure; and
IURA Minutes
November 16, 2017
Page 3 of 8
WHEREAS, the 100s West project is an approximately $2.5 million project by Urban Core, LLC to
rehabilitate 3 adjacent buildings located at 121 W. MLK, Jr/State St., 123 W. MLK, Jr./State
Street and 108‐114 W. Green Street, to create 4 below‐market housing units and renovate
25,000 square feet of retail and commercial space, and
WHEREAS, the 310 W. State/MLK Jr. project will rehabilitate a locally‐designated historic
landmark property in dilapidated condition for a residential use, and
WHEREAS, the property owners have agreed to provide the full 10% required local match
contribution, so no City match funds are required; now, therefore, be it
RESOLVED, that the Ithaca Urban Renewal Agency hereby endorses a Restore NY5 application
for up to $1,000,000 that includes the following projects:
100s West, Urban Core, LLC
310 W. State Street, David Halpert and Teresa Halpert Deschanes, and be it further
RESOLVED, that the Chair in consultation with the Chair of the Economic Development
Committee is authorized to structure the proposal to maximize competitiveness and address
any unforeseen feasibility issues that may arise.
Carried Unanimously 4‐0
B. Cayuga Green Project ― Loan Modifications to Facilitate Refinancing
Bohn explained the IURA has two loans for The Lofts at Six Mile Creek and Cayuga Green properties.
The owners have been seeking a buyer for the properties; however, the initial offer fell through. The
owners now propose refinancing the properties, but with no subordinate mortgages on the properties.
They have asked the IURA to remove the mortgages in return for substitute loan security and an
increase in the interest rates on the loans. The substitute loan collateral would take the form of a
leasehold mortgage lien. The IURA would be secured by the value of the leaseholds. The IURA would
be in second position behind Tompkins Trust Company. In addition, the owners have offered personal
guarantees for one of the properties. The owners have substantial net worth. Bohn indicated the offer
represents a good value on collateral for the IURA, when combined with the higher interest rates the
borrowers have agreed to pay. Furthermore, the owners have stabilized their operations and their
tenants have long‐term commitments to the properties. He believes it is a reasonable offer.
Moved by Proulx, seconded by Graham:
Cayuga Green Project ― Refinancing Private Sector Components
WHEREAS, the Cayuga Green public‐private project redeveloped underutilized downtown sites
including:
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;
IURA Minutes
November 16, 2017
Page 4 of 8
120 E. Green Street – a 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, a previously proposed conveyance of property at 131‐135 E. Green Street and 217 S.
Cayuga Street did not proceed to closing, and
WHEREAS, the IURA’s private sector partners, Cayuga Green LLC and The Lofts at Six Mile Creek,
LLC (collectively known as Bloomfield/Schon) seek to refinance existing debt on Cayuga Green
from Fannie Mae, and
WHEREAS, Fannie Mae loan terms prohibit subordinate mortgage liens on property they
finance, and
WHEREAS, the existing terms of IURA loans on Cayuga Green properties are:
Existing Terms 217 S. Cayuga Street 131‐135 E. Green Street
Borrower: Lofts on Six Mile Creek, LLC Cayuga Green, LLC
11/1/17 Loan Balance: $222,279.45 $723,899.31
Interest Rate: 4% 5.5%
End of Loan Term: 4/1/29 (137 months) 8/1/38 (247 months)
Monthly Payment: $2,023.70 $4,881.04
Loan Security: 2ND mortgage(behind $7
million)
Personal financial
guarantees of Bloomfield &
Schon
5th mortgage (behind $16
million)
Allocation of Loan Payments: IURA $40k to IURA, remainder to
City
and,
WHEREAS, Bloomfield/Schon have agreed to enhance loan repayment terms to the IURA in
consideration of substitute loan security that excludes mortgages on 217 S. Cayuga Street and
131‐135 E. Green Street, and
WHEREAS, Bloomfield/Schon offer a 2nd leasehold mortgage (behind only Tompkins Trust
Company) on master leases covering spaces occupied by Merrill Lynch, Coltivare and
Cinemapolis, and personal financial guarantees as substitute loan security, and
WHEREAS, the proposed modified loan terms are summarized in the table below:
IURA Minutes
November 16, 2017
Page 5 of 8
Revised Terms 217 S. Cayuga Street 131‐135 E. Green Street
Interest Rate: 6% 6.25%
Monthly Payment: $2,233.86 $5,189.02
Shared Loan Security: 2nd leasehold mortgage on master leases covering the ground
floor premises of the Cayuga Garage at 235 S. Cayuga Street
and cinema lease space at 120 E. Green Street
Personal financial guarantees of Bloomfield & Schon
And,
WHEREAS, the Economic Development Committee reviewed this matter at their November 7,
2017 meeting and recommended the following; now, therefore, be it
RESOLVED, the Ithaca Urban Renewal Agency hereby approves modifications to the above
reference Cayuga Green loans as follows:
Increase interest rate to 6% from 4% on the 217 S. Cayuga Street loan
Increase interest rate to 6.25% from 5.5% on the 131‐135 E. Green Street loan
Discharge subordinate mortgages on 217 S. Cayuga Street and 131‐135 E. Green Street
Obtain a 2nd leasehold mortgage on leases covering 23,000 square feet of commercial lease space
at 235 S. Cayuga Street and 11,000 square feet of commercial lease space at 120 E. Green Street
Obtain unlimited personal financial guarantees from Steven Bloomfield and Ken Schon, joint and
several, as security on the 131‐135 E. Green Street loan, and be it further
RESOLVED, that the discharge of mortgages is contingent upon the collateral value of the 2nd
leasehold mortgages exceeding 110% of the outstanding IURA loan balances based on a
satisfactory appraisal, 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
C. Green Street Garage Urban Renewal Project ― Authorize Issuance of Request for Proposal (RFP)
Proulx explained that Common Council authorized the IURA to issue the RFP, which Bohn has now
drafted. At the IURA Board’s last meeting, it was agreed the RFP should be as flexible as possible,
which was also the consensus of the EDC. The EDC slightly modified the weighting of the evaluation
criteria, partly to ensure robust community benefits. The EDC also extended the timeline by a month,
both because of the upcoming holidays and the desire to provide ample opportunity to market the RFP
and for the applicants to develop solid proposals, which will be likely to meet the City’s needs.
Bohn added that once the developer is selected there will be a 90‐day negotiation period. Assuming
the final proposal is acceptable to the IURA, a disposition and development agreement would be
generated. At the end of the process, a Public Hearing will be held and Common Council will meet to
review the proposal. Additional opportunities for soliciting public input could also be scheduled (e.g.,
IURA Board and/or EDC meetings).
IURA Minutes
November 16, 2017
Page 6 of 8
Cornish added the Planning and Development Board will also be holding a Public Hearing for its
Environmental Review, during the Site Plan Review process.
Moved by Proulx, seconded by Farrell:
Issuance of Request for Proposals (RFP) to
Undertake Green Street Garage Redevelopment Project
WHEREAS, the City has authorized transfer of the Green Street Parking Garage property located
at 120 E. Green Street (tax parcel #70.‐4‐5.2) to the IURA for the purpose of structuring a
proposed property sale and development agreement with a Preferred Developer to undertake
an urban renewal project; and
WHEREAS, the City requests the IURA select a Preferred Developer through an open competitive
process; and
WHEREAS, the IURA has approved acceptance of the property transfer and agreed to structure a
proposed urban renewal project for consideration for Common Council consideration; and
WHEREAS, at their November 7, 2017 meeting, the IURA Economic Development Committee
reviewed this matter and revised a draft #1 RFP document now, therefore be it
RESOLVED, the IURA hereby authorizes issuance of draft #2 of a Request for Proposals to seek
out a project Sponsor (AKA preferred developer) to undertake an urban renewal project at the
Green Street Parking Garage site; and be it further
RESOLVED, that the Economic Development Committee is hereby requested to review
proposals received and recommend a Sponsor(s) for IURA approval.
Carried Unanimously 4‐0
D. Committee Chairperson Report
None.
(Proulx departed at 9:17 a.m.)
VI. Neighborhood Investment Committee (NIC) Report
A. Assessment of Fair Housing ―Discussion
Graham indicated the Assessment of Fair Housing Goals Summary table was included in today’s
meeting packet. The IURA Board should discuss them at this time.
IURA Minutes
November 16, 2017
Page 7 of 8
“Goal #1: Prohibit discrimination on the basis of source of income, by establishing local (jurisdiction
and region) law(s) establishing protection, authorizing enforcement entity and creating meaningful
protocol.”
Graham explained that Goal #1 was created because protected classes currently appear to be suffering
as a result of a number of landlords refusing to accept Section 8 Housing Choice Vouchers. While
passing legislation may be possible to address the issue, the City/IURA could also collaborate with the
Landlords Association to identify a solution.
Mendizabal added that she spoke to Tompkins Community Action (TCAction) housing staff, who
recommended that TCAction, Ithaca Housing Authority (IHA), and the Tompkins County Department of
Social Services (DSS) all work together to approach the landlords and answer any questions they may
have about Housing Choice Vouchers, as the first step in the process.
Graham asked if TCAction happened to discuss some landlords’ concerns that rental unit damage
payments can be slow to process. Mendizabal replied, yes, that was discussed. TCAction staff had
differing viewpoints on that particular issue. Some indicated they thought the concern may not be as
significant as some landlords contend.
Bohn added that particular concern may have stemmed more from landlords’ experience with the DSS
program, than other programs. TCAction believes some landlords may be confused by the various
housing assistance programs. It would certainly help address the situation if landlords were provided
some more educational opportunities. The City/IURA and the other stakeholders could reach out to
landlords to determine if a programmatic effort could be identified that would solve the problem.
Graham asked if staff would draft the legislation. Bohn replied that IURA staff could take the lead in
initiating that process, working with the City Attorney’s Office and Tompkins County staff. He believes
legislation was proposed at some point, at the County level, regarding the issue, a more appropriate
level of government to address the issue for the entire county housing market.
“Goal #2: Increase supply and access to affordable housing options, particularly at extremely low,
very low and low income‐levels, especially in high opportunity neighborhoods.”
Graham asked if IHA has ever considered expanding the properties it owns. Bohn replied he has not
heard that is the case; and he does not believe IHA would have any funding available to do that. There
is, however, a HUD public‐private development initiative called the Rental Assistance Demonstration
program that may allow IHA to provide surplus land to developers who agree to build a mixed income
housing project. Unfortunately, IHA faces the same financial constraints the IURA has been confronted
with, as a result of continuing declines in Federal budgets.
“Goal #3: Establish clear local authority and meaningful mechanisms for enforcement of fair housing
law.”
Graham asked which agency/organization would be best suited to handle enforcement (e.g., Human
Rights Commission). Bohn replied that would be a critical component of any legislation. Currently, the
IURA Minutes
November 16, 2017
Page 8 of 8
Tompkins County Office of Human Rights takes the lead locally as an initial in‐take for complaints, but
they lack true authority for investigation or enforcement. Further research would need to be done. It
would not be something the City’s Building Division would be able to do.
Mendizabal indicated IURA staff could examine best practices from other municipalities, in terms of
enforcement mechanisms.
B. Committee Chairperson Report
None.
VII. Other New/Old Business
A. Review of IURA Financials: October 2017
Bohn reported that October is the last month of financial reports that will not include 2017 projects in
the Grants Summary. In terms of loans, e2e Materials and The State Theatre were both delinquent
when the report was generated. e2e Materials has made some progress towards commercializing its
technology, but the IURA does not expect it to make any payments in the next few months. The State
Theatre has made two payments since the report was generated. All lease payments are current as of
today.
B. IURA Chairperson Report
None.
C. Common Council Liaison Report
None.
D. Staff Report
None.
VIII. Adjournment
The meeting was adjourned by consensus at 10:02 A.M.
— END —
Minutes prepared by C. Pyott, edited by N. Bohn.