HomeMy WebLinkAboutMN-IURAED-2018-03-27Approved: 4/17/18
108 E. Green St.
Ithaca, NY 14850
(607) 274-6565
MEETING MINUTES
ITHACA URBAN RENEWAL AGENCY
Economic Development Committee (EDC)
― SPECIAL MEETING ―
3:00 PM, Tuesday, March 27, 2018
Common Council Chambers, City Hall, Ithaca, NY
Present: Chris Proulx, Chair; Doug Dylla, Vice‐Chair; Leslie Ackerman; Heather Harrick;
Charles Hamilton
Excused: None
Vacancies: 1
Staff: Nels Bohn; Charles Pyott; Anisa Mendizabal
Guests: James Trasher, CHA (consulting engineer)
Andy Breuer, Hueber‐Breuer (general contractor)
Jeff Rimland, Ithaca Properties, LLC (developer)
Jeff Githens, Ithaca‐Peak Development, LLC (developer)
Tom Knipe, Deputy Director for Economic Development, City of Ithaca
Ari Lavine, City Attorney, City of Ithaca
Tim Logue, Director of Engineering Services, City of Ithaca
Michael Thorne, Superintendent of Public Works, City of Ithaca
Svante Myrick, Mayor, City of Ithaca
I. Call to Order
Chair Proulx called the meeting to order at 3:05 P.M.
II. Agenda Additions/Deletions
None.
III. Continuation ― Green Street Parking Garage Site Redevelopment RFP
A. City Staff Input Regarding Structural Assessment of Green Street Parking Garage & Proposed
Downtown Conference Center
Proulx explained several issues were raised at the last Committee meeting about the project’s
parking capacity and the City’s parking demand, as well as the structural condition of the garage.
He asked City staff to update the Committee on those two particular issues.
Ithaca
Urban
Renewal
Agency
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March 27, 2018
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Logue responded that the City commissioned a study (“Green Street Parking Garage, East & West
End Study,” December 7, 2016) by Stantec to investigate the structural condition of the garage.
The conclusion was that the City would need to perform significant and expensive repairs to
preserve the garage. The study presented a range of scenarios, depending on the
intensivity/expense of the repairs and what lifecycle for the garage is sought. Repairs would cost
$5‐10M to extend its lifecycle 5‐30 years. Needless to say, the City would prefer not to spend
‘good money after bad’. In addition, many components of the garage cannot be easily inspected,
so there are numerous unknown factors involved; and there is no guarantee the City would obtain
a set number of additional years from any repairs. Logue added there is also the opportunity cost
associated with simply maintaining the garage in its current form vs. seeking the highest and best
use of the site. Regarding the parking supply and demand question, the City does do not currently
have conclusive quantifiable data on current demand (although there have been a few studies and
parking counts over the past few years).
Thorne added that the City will conduct a comprehensive parking demand study, but that remains
in the planning phase.
Logue noted the occupancy rates of the three garages are approximately: (1) 70‐80% for the
Green Street Garage; (2) 85% for the Cayuga Street Garage; (3) and at least 85% for the Seneca
Street Garage.
Thorne added there are many new projects being constructed and planned, so the City expects
parking demand to increase accordingly.
Proulx inquired about the Green Street Garage’s current capacity. Logue replied he is not exactly
certain, but he would guess approximately 380 spaces.
Bohn explained the City recently modified its parking fee structure to incentivize commuters to
make greater use of the Cayuga Street Garage; and it has seen approximately 80 more parkers
there ― but the downtown garages are effectively moving towards full occupancy. In 2017,
Cayuga Street Garage was at 52% occupancy, but is now at 62%. There are approximately 400
total spaces still available in the three garages.
Harrick asked how many spaces would be generated under the current development proposal.
Bohn replied: 411. Harrick asked if the Cayuga Street Garage is managed by the City. Bohn
replied, no. While pricing is set by the City, it is managed by a private entity.
Harrick asked who would be responsible for managing the parking for the project. Bohn replied
that would need to be negotiated.
Proulx noted another issue is the distribution/configuration of the new parking spaces (i.e., how
many would be dedicated to commuters vs. project residents vs. visitors).
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March 27, 2018
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Harrick noted she would like to see continuity in terms of how the public is able to access and use
downtown parking (e.g., signage, mobile phone app).
Ackerman suggested signage would be very important to ensure visitors are aware of the garages.
Although 400 available spaces is not inconsiderable, people need to be aware of them.
Thorne cautioned the occupancy figures being cited today are all averages ― they do not
represent peak usage periods, when there are no spaces.
Proulx noted another concern that has been raised is the availability of loading spaces. Logue
replied the City recognizes the importance of loading spaces to the downtown area. Harold’s
Square will produce a small deficit in loading spaces. On the other hand, the City Centre project
will create a new loading space. The City is also open to converting on‐street parking spaces into
loading spaces.
Proulx noted Logue cited a number of scenarios for repairing the Green Street Garage. The
development team estimated a complete repair of the garage at $17M. Logue replied some of the
repair options do reach up to $18M.
Hamilton asked if a fair market value for the site has been established yet. Bohn replied, no.
Appraisals have only been conducted for portions of the site.
Lavine noted in addition to the actual costs of garage repairs there are costs associated with the
City’s legal arrangements with Ithaca Properties, LLC (Jeff Rimland), since the garage deck serves
as the roof of its office space, which would become unleasable while repairs are made. The legal
costs could be several hundred thousand dollars.
Regarding the conference center, Knipe explained discussions on the subject have been taking
place for many years. The City collaborated with the Downtown Ithaca Alliance (DIA) to hire
Hunden Strategic Partners to conduct a feasibility analysis for a downtown conference center
(“Ithaca Conference Center Market & Feasibility Study,” April 14, 2017). The general consensus
from the study is that building a conference center of a minimum size would generate demand for
a variety of group events downtown. The opportunity to increase local tourism revenue is largely
limited to that kind of function. City staff discussed the current development proposal with some
local hoteliers, who concluded the proposed conference center would need to be somewhat
larger for the City to see a significant benefit. Any conference center would also need capital
funding, operating funding, and an organizational framework to be viable.
Hamilton asked how large an ideal conference center would need to be. Knipe replied it would need
a 10,000 square‐foot ballroom, 5,500 square feet of meeting spaces, and 3,000‐4,000 square feet
of pre‐function space ― a total of approximately 30,000 square feet. The current proposal only
provides 20,000.
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March 27, 2018
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Ackerman asked how many people an ideal conference center should be able to serve. Knipe
replied, meetings of 500‐600 people.
Bohn remarked he drafted a document (“Project Modifications Mutually Agreed Upon Between
the IURA and Ithaca‐Peak, LLC”), which should serve as an agreed‐upon starting point for future
negotiations.
B. Establishment of Mutually Agreed Upon Modified Project Elements & Public Benefit Goals
Trasher noted that at the last Committee meeting the development team proposed allocating 9%
of the total number of units as affordable, at 90% Area Median Income (AMI). The developers
now propose 10% of the units as affordable, at 75% AMI.
Githens explained (as noted in his March 20, 2018 letter to Bohn) that the development team
initially met extensively with Ithaca Neighborhood Housing Services (INHS) on how to determine
the best approach to meet the City's affordable housing needs for the project. The development
team concluded that, because of the financing challenges, size, and difficulty of the site, it would
identify a fixed percentage of proposed units as affordable. The developers ultimately arrived at a
9% figure at 90% AMI, since they saw that as the optimum target, correlating to their
understanding of the largest underserved demographic in the community. Since the last
Committee meeting, however, the development team was asked to lower the target to 75% AMI,
which it would be willing to do. Affordable units would also be distributed across multiple unit
types, rather than restricted to the studio unit type, as originally proposed. This modification to
the project would ultimately lower the project’s rental revenue ― so the development team
would seek to off‐set the loss through grants, tax breaks, and other funding sources.
Ackerman asked how many more affordable units would be provided under the revised proposal.
Githens replied, 38 to 40.4, out of a total of 405.
Harrick asked who would be responsible for managing the affordable units. Bohn replied that
would be another part of the negotiations. The IURA, Tompkins Community Action, and INHS
could all potentially handle the certification and income‐verification process.
Hamilton noted the development team mentioned seeking additional funding sources; he asked how
much that would be, and whether the developers would be open to increasing the number of
affordable units if the City/IURA were to procure additional funding. Githens replied that
designating 10% of the units as affordable would cost the project $1.55M in revenue, so that is the
figure they would seek, in order to maintain the minimum threshold of 6.5% return in Year One.
Hamilton asked if the project would be able to include 20% of its units as affordable housing, if the
City/IURA were able to procure twice that $1.55M amount. Githens replied, possibly. There are
some restrictions in terms of what would be possible (e.g., going above 50 units in project like this,
in a single location, could be problematic, since there may not be enough demand).
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March 27, 2018
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Proulx asked Bohn if the project would qualify for Low‐Income Housing Tax Credits (LIHTC). Bohn
replied, no. The units would have to be priced at 60% AMI.
Harrick asked if the project would be canceled if the developers could not get the additional
funding. Githens replied, possibly, although there may be other ways of making up the difference.
If/when the development team is formally designated as the preferred developer/sponsor, they
would be able to more quickly determine what would be feasible.
Harrick asked if the funding gap is typical of the development team’s other projects. Githens
replied, no. It is unique, given the cost and complexity of rebuilding the parking deck.
Proulx asked if there is anything in the “Parking” section of the “Project Modifications” document
the development team objects to. Githens replied, no.
Dylla asked if secure bicycle parking would be included in the project. Githens replied, yes,
although he is not sure how much.
Dylla remarked he would personally rate the conference center as a low priority, compared with
all the other priorities. He added that public access to the roof terrace would be very important as
a public amenity.
Ackerman noted the conference center was originally a key benefit of the project, but it is difficult
to gauge its importance after today’s discussion.
Trasher noted the development team provided the IURA with more detail about the conference
center than was probably necessary. The important thing to remember is the space has been
identified and the details could be worked out.
Proulx asked if the development team could increase the number of units and affordable units, if
the conference center were not part of the project. Githens replied, not necessarily. Increasing
the number of units may risk the project’s residential capacity becoming too large. The
developers do not want to ‘over‐densify’ the residential component in proportion to the other
components. If the conference center were excluded, the developers would probably prefer to
reprogram that space as retail space.
Proulx inquired into street‐level active uses for the project. Bohn replied the development team
raised a concern about whether the leasing office would qualify as street‐level active use, which
the Planning and Development Board would need to determine. The ultimate goal is to enliven
Green Street, which many of the project elements would do.
Hamilton asked how the purchase price and other financial elements of the project would be
calculated. Bohn replied the fair market value would be identified, then all the public benefits
would be monetized and subtracted from that, during the negotiation process.
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March 27, 2018
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Proulx observed one item not included in the “Project Modifications” document is the issue of
local construction labor. According to the last Committee meeting minutes, Breuer indicated he
believed 75% of construction labor could be local labor.
Bohn replied that is not strictly a modification, since the applicants checked the local labor box in
their proposal as something they would employ. 75% local labor would be a very desirable
threshold for a public benefit. He added the City/IURA definition of local labor is that the laborers
themselves actually have to live locally.
Breuer remarked it may be harder to meet the local labor threshold if it is defined by the location
of the laborers, but Hueber‐Breuer is a regional company and he believes 75% would be relatively
close to what would be feasible.
C. Designation of Ithaca‐Peak Development, LLC as Qualified & Eligible Sponsor to Undertake
Urban Renewal Project at 120 E. Green St. & Authorization to Enter Into Exclusive Negotiation
Agreement with Sponsor
Hamilton remarked he would only support approving the resolution if the “Project Modifications”
document indicates the project should include a minimum housing affordability period of 30 years.
No objections were raised.
Hamilton moved, seconded by Dylla:
Property Disposition: 120 E. Green St. ― Designate Ithaca‐Peak, LLC
as Qualified & Eligible Sponsor for Urban Renewal Project
& Authorize Exclusive Negotiation Agreement
1. WHEREAS, on October 4, 2017, the City of Ithaca Common Council authorized transfer of
the Green Street Parking Garage property located at 120 E. Green Street (tax parcel #79.‐4‐
5.2) to the IURA, via an option agreement, for the purpose of structuring a proposed
property sale and development agreement with a preferred developer to undertake an
urban renewal project subject to approval by the Common Council, and
2. WHEREAS, the project site contains a municipal parking facility with approximately 415
active parking spaces, an 11,000 SF cinema and a walkway connecting Green Street with
the Commons; and
3. WHEREAS, the Common Council further directed the IURA to seek out the following
programmatic elements to be included in the project:
A conference center;
Housing units specifically designed to appeal to a diverse demographic, including a
substantial number of units to be affordable to low and/or middle income households;
Street level active uses along Green Street;
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March 27, 2018
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Retention of the Cinemapolis movie theatre and a public walkway between Green
Street and the Commons;
At least 450 parking spaces open to the public, of which at least 90 will be available for
short‐term parking; and
4. WHEREAS, on November 22, 2017 the IURA issued a public Request For Proposals (RFP)
soliciting developers for the project, and
5. WHEREAS, as of the RFP submission deadline of February 23, 2018, one proposal was
received from Ithaca‐Peak Development, LLC (Ithaca‐Peak), a yet to be formed joint
venture between McKinley Development Companies, LLC d/b/a Peak Campus and Ithaca
Properties LLC (managing member Jeffrey Rimland), and
6. WHEREAS, Ithaca‐Peak submitted a proposal for a $122,894,000 project including the
following elements:
405 new housing units at a variety of unit sizes, of which 38 workforce studios will be
priced at rents affordable at 90% AMI and occupied by persons earning 100% AMI or
less. Units are targeted for graduate students, faculty and staff and your professionals.
Street‐level active uses fronting along Green Street, including a 900 SF retail space,
6,000 SF of residential amenity space, and a conference center main entrance at grade
level;
A total of 434 off‐street parking spaces, including 420 newly constructed parking spaces
and 14 existing at‐grade parking spaces;
Retention of the 11,000 SF Cinemapolis movie theatre and the public walkway between
Green Street and The Commons;
A 18,000‐20,000 SF conference center; and
7. WHEREAS, the IURA Economic Development Committee sought modifications to the
proposed development project that have been negotiated with the Ithaca‐Peak, and
8. WHEREAS, the project site is located within the Urban Renewal Project Boundary area and
is an appropriate location for a mixed‐use project, and
9. WHEREAS, the IURA is authorized to sell property to a specific buyer if such buyer is
designated as an eligible and qualified sponsor (Sponsor) pursuant to section 508 of
General Municipal Law and the sale is approved by Common Council, and
10. WHEREAS, a proposed Sponsor is evaluated in accordance with adopted IURA land
disposition procedures that seek to determine if the proposed Sponsor is qualified and
capable of fulfilling the objectives of the urban renewal project for property disposition,
and
11. WHEREAS, IURA evaluation criteria for Sponsors include:
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March 27, 2018
Page 8 of 16
Financial status and stability
Legal qualification to operate in the State of New York and to enter into contracts with
regard to the disposition, use, and development of land in questions
Previous experience in the financing, use, development and operation of projects of a
similar nature
Reputation and proof of fair, reputable and ethical business practices and a record
devoid of convictions; and
12. WHEREAS, the primary objective of the Urban Renewal Plan (Plan) is to improve the
economic, social and physical characteristics of the project neighborhood, and
13. WHEREAS, the following specific objectives of the Plan are advanced by the proposed
project:
expansion and diversification of the economic base of the community to provide the
employment opportunities needed by its residents and to strengthen the tax base”,
and
improvement of the residential environment through a program of redevelopment,
rehabilitation, conservation, and new construction to assure every family in Ithaca a
decent home within its economic means;
provision of the full range of neighborhood and community facilities and services
necessary to meet the residents’ needs, through new construction or improvement of
existing facilities and programs;
provision of adequate vehicular and pedestrian circulation; and
14. WHEREAS, the Ithaca‐Peak project team has development experience and financial
resources necessary to successfully develop and operate the proposed project and satisfies
other criteria for designation as a Sponsor for an urban renewal project; and
15. WHEREAS, the proposed project has potential to improve the economic, social and physical
and characteristics of the project neighborhood, and
16. WHEREAS, a designation of a Sponsor is an initial formal step in the process to undertake
an urban renewal project that may lead to a Disposition and Development Agreement for
the Sponsor to acquire and redevelop the project site, and
17. WHEREAS, a subsequent step in the urban renewal process is a 90‐day Exclusive
Negotiation Agreement between the potential purchaser (Sponsor) and seller (IURA) to
finalize a term sheet to define the project and resolve seller contingencies and pre‐
identified negotiation issues enumerated in the RFP, and
18. WHEREAS, the term sheet will specify project elements included in the project,
performance milestones, schedule, post‐construction project management of parking,
purchase terms and obligations of the seller and purchaser, and
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March 27, 2018
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19. WHEREAS, the IURA Economic Development Committee considered this matter at their
March 13th and March 27th 2018 meetings and recommends the following; now,
therefore, be it
20. RESOLVED, the IURA hereby finds that Ithaca‐Peak Development, LLC satisfies IURA
sponsor criteria ‐ including qualifications, capacity and experience ‐ to be designated a
“qualified and eligible sponsor” to undertake an urban renewal project to undertake an in‐
fill, mixed‐use project at 120 E. Green Street, Ithaca, NY, upon registering as an legal entity
to conduct business in New York State, and be it further
21. RESOLVED, the IURA hereby finds that to ensure the proposed urban renewal project
satisfies IURA criteria that an urban renewal project be consistent with the Urban Renewal
Plan, and improve the economic, social and physical characteristics of the project area, the
proposed project submitted by Ithaca‐Peak shall be amended to incorporate the attached
project modifications mutually agreed upon between the IURA and Ithaca‐Peak, LLC, dated
3/27/18, and be it further
22. RESOLVED, the IURA hereby designates Ithaca‐Peak, LLC as a “qualified and eligible
sponsor” (Sponsor) eligible to potentially acquire tax parcels #79.‐4‐5.2 through
negotiations for the purpose of undertaking an urban renewal project to develop an in‐fill
mixed use project located at 120 E. Green Street, Ithaca, subject to registering with the
New York State Department of State as a business entity; and be it further,
23. RESOLVED, that the IURA Chairperson, subject to review by IURA legal counsel, is
authorized to execute a 90‐day Exclusive Negotiating Agreement with the Sponsor for the
purpose of structuring a proposed Disposition and Development Agreement to convey tax
parcels #79.‐45.2 to the Sponsor to undertake a specified urban renewal project, and be it
further
24. RESOLVED, any Disposition and Development Agreement shall be subject to approval by
both the IURA and the Common Council.
Carried Unanimously 5‐0
Project Modifications Mutually Agreed Upon
Between IURA & Ithaca‐Peak, LLC
Project: Green Street Garage Redevelopment Urban Renewal Project, 120 E. Green Street
Applicant: Ithaca‐Peak, LLC
Following are mutually agreed modifications to the development proposal submitted by Ithaca‐Peak, LLC to
the IURA on 2/23/18 for the purposes of further defining the intended urban renewal project that will be
the subject of negotiations to potentially convey the project site to the developer for a specified urban
renewal project:
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March 27, 2018
Page 10 of 16
Affordable Housing
Goal: Maximize affordable housing within the project consistent with project financial feasibility defined as
a 6.5% return on project cost
Minimum public benefit outcomes:
10% of rental housing units shall be priced at rents affordable to a household earning 75% of Area
Median Income (AMI) as determined by the U.S. Department of Urban Development (HUD).
Affordable units shall be occupied by households earning 80% or less of AMI.
Affordable housing shall be provided across multiple unit sizes, including studios, one‐bedroom and
two‐bedroom sizes in rough proportion to the unit size mix for the entire project.
Affordability period: 30 years
Parking
Minimum public benefit outcomes:
Reconstruction of two decks of parking at the east and west sections of the Green Street Parking
garage, including at least 60 car lifts resulting in total deck parking capacity for approximately 411
vehicles;
9 parking/loading spaces at grade under the western deck;
City control and management of at least six (6) at‐grade parking spaces facing City Hall during hours
of operation; and
A minimum of 90 deck parking spaces shall be made available for combined hotel and short‐term
public use.
A an additional minimum number of deck parking spaces shall be made available for public use for
monthly and/or short‐term parking equal to the number of monthly parking passes issued for the
Green Street Parking Garage as of March 27, 2018 (approximately 150 spaces).
Active participation in the Transportation Demand Management program to reduce downtown
parking demand.
Note: the City has not consented to establishment of sixteen (16) on‐street parking spaces on Green Street
as shown in the 2/23/18 proposal. No increase in on‐street parking is anticipated at this time.
Loading/Deliveries
The project shall be designed to provide reasonable access for deliveries, services and loading for City Hall
and all Commons properties that possess legal access rights across the access way located between City
Hall and the Green Street Parking Garage, including, but not limited to, Harold Square.
Conference Center
There is no commitment by the City to lease conference center space in the project. Either a conference
center or an alternative street‐level active use along Green Street is acceptable. There is no requirement
for inclusion of a conference center in the project.
Street‐Level Active Use
The 5,959 SF ground floor area fronting on Green Street designated for “Amenities” shall conform to the
zoning ordinance requirements for active street‐level active uses on the Commons and Secondary
Commons to encourage high levels of pedestrian activity, enliven the streetscape, and create well‐lit spaces
with ample visibility into the storefront area. Per the zoning ordinance, active uses include, but are not
limited to, the following:
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March 27, 2018
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1. Retail store or service commercial facility.
2. Restaurant, fast‐food establishment, or tavern.
3. Theater, bowling alley, auditorium, or other similar public place of assembly.
4. Hotel.
5. Bank or monetary institution.
6. Confectionary, millinery, dressmaking and other activities involving light hand fabrication, as well as
sales.
Additional uses may be permitted if the Planning and Development Board determines them to be an active
use and grants special approval for the use. The Planning Board may also grant a special approval of a non‐
active use if a property owner is able to show that the physical structure is not easily adaptable to be used
as one of the above listed active uses.
Pedestrian Circulation Between Public Parking and The Commons
It appears the only stairs and elevator circulation serving public parking are located in the existing center
section of the garage. A second public pedestrian connection leading to The Commons at the eastern end
of the garage shall be incorporated into the project.
Currently, the Green Street Garage is only served by on elevator car, which recently was inoperable for an
extended time period due to patrons exceeding the load capacity, which resulted in patrons without
disabilities unable to return to their car. The elevator core was designed to accommodate a second car. A
second elevator car shall be incorporated into the project to serve public parking patrons.
Public Amenities ‐ Roof Terrace Amenity
Public access to the level 7 roof terrace amenity, or semi‐public access to a food/beverage vendor on the
roof terrace, is highly desirable. Such access would offer the public interesting and unique views of the city
and outdoor space, and be viewed as a public benefit if incorporated into the project.
If roof terrace access is not made available, alternative public amenities should be incorporated into the
project to enhance the physical and cultural characteristics of the project area, such as public art, public
walkway and streetscape improvements.
Proposed Purchase Price of Project Site
The proposed purchase price contained in the proposal is $0.00 in recognition of a projected $17MM cost
to reconstruct the parking garage. The final proposed purchase price shall be based on the Fair Market
Value of the project site as determined by an appraisal minus the net present value of public benefits
delivered by the project.
Regarding parking, only parking spaces available to the general public on a first‐come, first‐serve basis, or
parking spaces provided pursuant to a pre‐existing city parking agreement shall be considered as delivering
public benefits. Parking spaces reserved for project residents are not considered to deliver public benefits
to offset the property sales price. Regarding housing, the net present value of affordable housing shall be
derived from the difference between market rents and 75% AMI rents over the affordability period. If any
local affordable housing subsidies are delivered to the project, such assistance shall be considered in the
calculation of the project’s public benefit deriving from provision of affordable housing.
― END ―
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March 27, 2018
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IV. Community Loans
A. e2e Materials, Inc. (CD‐RLF #27) ― Recognize Loan as UncollecƟble
Bohn explained the IURA has already received principal and interest payments of $35,000. It was
a relatively risky loan at the time it was issued. Ultimately, e2e could not obtain the licensing
agreement it was seeking.
Dylla moved, seconded by Ackerman:
e2e Materials, Inc. (CD‐RLF #27) ― Recognize Loan as Uncollectible
WHEREAS, on November 22, 2010, the IURA issued a $100,000 loan at 9% interest to e2e
Materials, Inc. (“e2e”) for machinery and equipment for a prototyping facility for a
proprietary, molded bio‐composite material located at 239 Cherry Street, and
WHEREAS, the IURA loan is secured through a shared lien on machinery and equipment that
was valued at $284,000 in 2010, and
WHEREAS, e2e met its job creation goals, but has struggled to commercialize their
technology, and
WHEREAS, the last loan payment was received on May 30, 2017, and
WHEREAS, the outstanding balance on the loan is $35,349.65, and
WHEREAS, in June 2017, e2e management informed the IURA that they will suspend loan
payments until new shareholders acquire the company in August, and
WHEREAS, in September 2017, e2e management informed the IURA that rather than have
new shareholders acquire the company, it intends to sell its technology via a licensing
agreement to a manufacturing partner that will pay a royalty based on future commercial
production utilizing the technology, and
WHEREAS, e2e plans to pay off its IURA debt obligation from royalties to be received from a
licensing agreement expected to begin generating revenue in 12‐18 months, but in the
interim loan payments will remain suspended, and
WHEREAS, following sale of their technology, e2e plans to cease physical operations in late
January 2018, and
WHEREAS, there is significant risk that the proposed licensing agreement will either not be
executed or that royalties received from the licensing agreement will not be sufficient to
repay the IURA debt; and
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March 27, 2018
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WHEREAS, e2e is a pre‐revenue company that lacks revenues to repay the IURA debt at this
time and requires continued use of machinery and equipment to demonstrate the
commercial value of their technology to execute a license agreement, and
WHEREAS, the IURA Economic Development Committee reviewed this matter at their
October 10, 2017 meeting and March 13, 2018 meetings and recommends the following;
now, therefore, be it
RESOLVED, that the IURA hereby writes off the outstanding principal balance of $35,349.65
due from e2e Materials, Inc. and recognizes the debt as uncollectible, and be it further
RESOLVED, that staff is hereby directed to work with the shared lien holder and borrower to
seek liquidation of the collateral in an orderly manner after physical operations of e2e cease.
Carried Unanimously 5‐0
B. IURA Loan & Lease Payment Report: February 2018
Bohn reported all the loan payments (except e2e Materials) and lease payments are current.
C. Loan Pipeline
Bohn announced a loan application will be coming in from The State Theatre, which is trying to
expand its concessions sales.
D. Staff Report
Bohn reported that Ithaca received the Restore NY Round 5 award for the rehabilitation of the
100s West and 310 W. State Street projects.
V. FY18 HUD Entitlement Program: Review of Economic Development Funding Applications
Hospitality Employment Training Program (HETP), Greater Ithaca Activities Center (GIAC) ― Job Training
with Job Placement
Ithaca ReUse Center Expansion, Finger Lakes ReUse (FLRU) ― Job Creation
Volunteer Worker & Job Skills Training, Finger Lakes ReUse (FLRU)― Job Training with Job Placement
Re‐Entry Hub: Ground Works, Opportunities, Alternatives, & Resources (OAR) ― Microenterprise
Assistance
Work Preserve Job Training: Job Placement, Historic Ithaca ― Job Training with Job Placement
Food Entrepreneurship Program (FEP) 2.0, Cornell Cooperative Extension ― Microenterprise Assistance
Bohn explained that funding for economic development applications all needs to come out of
Community Development Block Grant (CDBG) funds. The Neighborhood Investment Committee
(NIC) reviewed all the economic development applications and recommended $235,000 be
dedicated to them, except the Ithaca ReUse Center Expansion project, which would be funded
from other sources.
IURA EDC Meeting Minutes
March 27, 2018
Page 14 of 16
Harrick noted the IURA has funded most of the programs currently being considered, year‐after‐
year, but she wondered if perhaps it should actively seek to fund new ones. Bohn responded
there is no single standard for selecting which programs to fund, but the IURA should certainly
examine the past performance and organizational capacity of each applicant.
Bohn noted when he reviewed the Ithaca ReUse Center Expansion application it appeared to be
essentially the same project that was proposed in 2017. It proposes to expand the site’s retail
space, but would only be eligible for all the funding it is seeking if it is connected to an affordable
housing project. It would not be possible for FLRU to spend the requested funds by this time next
year, but it will be important for it to have an IURA funding commitment to obtain other funding.
NIC recommended the IURA should commit Urban Development Action Grant (UDAG) funding to
the project in 2018 and simply substitute it with CDBG funding in 2019, assuming it receives all its
other funding.
Ackerman remarked she very much likes the concept of the Re‐Entry Hub: Ground Works project,
but she is not sure how well‐developed the details are. She is also not sure if the timeframe
appears feasible, given the challenges of working with the population it would be serving and the
lack of prior organizational experience in implementing a project like it. Also, the program goals
were not entirely clear to her.
Proulx agreed. The applicant also discussed collaborating with HETP, which would be desirable,
but that is the kind of relationship that would need to be better defined and developed. Dylla
agreed.
Bohn noted the applicant has in fact started collaborating with at least one local organization he
knows of.
Bohn added there is also a regulatory question about the project. The three main CDBG economic
development categories are: (1) job training; (2) job placement; and (3) micro‐enterprise
assistance. Micro‐enterprise assistance consists of two sub‐categories of its own: technical
assistance to individuals; and direct financial assistance to existing micro‐enterprises. Since the
program does not have defined LMI beneficiaries operating existing micro‐enterprises, the
program would need to conform to the technical assistance model.
Dylla suggested helping the applicant develop a business plan. Bohn replied that would be very
helpful, since the program needs to be well‐researched to be feasible. On the other hand, the
IURA has a policy of examining applications as they are submitted, not engaging in the potentially
protracted process of helping applicants improve their applications.
Proulx observed the applicant is undertaking an entirely new project with its Endeavor House
project, which raises the question of whether it has the capacity to operate another new program.
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March 27, 2018
Page 15 of 16
Proulx noted it is not possible to fully fund the four remaining applications. The Committee now
needs to begin prioritizing which ones it believes have the most merit. Most of them appear
scalable, so they should be able to function at some level with less funding than requested.
Harrick indicated she likes the work the Food Entrepreneurship Program (FEP) is doing. Since it
has only just launched, she would not want to undercut it until the IURA can at least see the
results from its first year of operation.
Proulx added that FEP is also the only direct economic development activity and it targets a
distinct population not served by the other programs.
Ackerman recommended taking the most funding away from HETP and the FLRU Volunteer
Worker & Job Skills Training program, since they are asking for the largest funding amounts and
both organizations have the greatest capacity/resilience to make up the loss.
Mendizabal added it is not clear from the application how the job placements would actually work
for the Volunteer Worker & Job Skills Training program (i.e., would job placements be at Challenge
Workforce Solutions, or elsewhere).
Proulx suggested not funding the volunteer coordinator position for the Volunteer Worker & Job
Skills Training program and reducing funding for stipends, which would bring IURA funding down
to $50,000. He remarked FLRU’s financial capacity also concerns. Perhaps the IURA should simply
encourage FLRU to focus on its core objectives and programs.
Proulx noted his concern with the Work Preserve Job Training program is that the funding‐to‐job‐
placement ratio is quite high, compared to the other programs ― although it admittedly works
with a far more vulnerable population.
For HETP, Proulx noted he would like to know whether the IURA is subsidizing training that
employers would have otherwise have provided themselves to qualified individuals. The other
two programs more clearly work with individuals struggling with employment.
Bohn responded that GIAC has demonstrated that it is effective in recruiting participants who
would not ordinarily be comfortable or prepared to access conventional job training programs. On
the other hand, GIAC does not seem to be getting more employers to directly fund the program.
Hamilton asked if the Committee should simply impose a straight‐line funding reduction in
proportion to the length of time each program has been funded by the IURA, given the limited
funding available.
Proulx replied he would prefer to identify which programs have the most impact.
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March 27, 2018
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Mendizabal remarked the Committee should also consider the social cost of decreasing funding
for programs serving the most vulnerable populations.
Ackerman noted the IURA could reduce the most funding from HETP, the second‐most from the
Volunteer Worker & Job Skills Training program, and a lesser amount from Work Preserve Job
Training. The IURA could also slightly reduce FEP funding, considering its population is least at risk
and much of the funding goes towards existing Cornell Cooperative Extension salaries.
Ackerman formally recommended the Committee reduce FEP funding by $10,000, FLRU funding by
$30,000, GIAC funding by $30,000, and maintain Work Preserve Job Training funding at the
requested funding level.
Proulx recommended the Committee reduce HETP funding to $75,000. Every program would then
be funded at roughly the same level.
VI. Review of Meeting Minutes: January 9, 2018 & March 13, 2018
Ackerman moved, seconded by Dylla, to approve the January 9, 2018 and March 13, 2018 minutes
with no modifications.
Carried Unanimously 5‐0.
VII. Adjournment
The meeting was adjourned by consensus at 5:43 P.M.
— END —
Minutes prepared by C. Pyott, edited by N. Bohn.