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HomeMy WebLinkAboutHousing & Redevelopment Authority Minutes 05-16-2002MINUTES PLYMOUTH HOUSING AND REDEVELOPMENT AUTHORITY May 16, 2002 PRESENT: Chair Susan Henderson, Commissioners Tim Bildsoe, Steve Ludovissie, Sandy Hewitt and Leon Michlitsch ABSENT: None STAFF PRESENT: Executive Director Anne Hurlburt, Housing Manager Jim Barnes, HRA Specialist Tracy Jones and Office Support Specialist Ranelle Gifford OTHERS PRESENT: LaDonna Hoy, Interfaith Outreach 1. CALL TO ORDER A meeting of the Plymouth Housing and Redevelopment Authority was called to order by Chair Henderson on May 16, 2002 at 7:00 p.m. 2. APPROVAL OF MINUTES MOTION by Commissioner Hewitt, seconded by Commissioner Michlitsch, recommending approval of the April 18, 2002 minutes. Vote. 4 Ayes. Commissioner Bildsoe abstained. MOTION approved. 3. CONSENT AGENDA A. PLYMOUTH TOWNE SQUARE MONTHLY REPORT MOTION was made by Commissioner Hewitt, seconded by Commissioner Michlitsch, approving the Consent Agenda. Vote. 5 Ayes. MOTION approved unanimously. 4. NEW BUSINESS A. UPDATE ON THE OPENING OF THE PLYMOUTH TOWNE SQUARE WAITING LIST Housing Manager Barnes gave an overview of the advertising for the opening of the Plymouth Towne Square waiting list. He stated potential applicants have 3 days to request the application and will have until June 19th to return the application. He stated the applications will then be sent to Plymouth Towne Square for opening and priority placement on the waiting list. He stated there are 3 two-bedroom units available at this time. Plymouth Housing and Redevelopment Authority April 18, 2002 Page 2 B. STATUS UPDATE AND UNCOMMITMENT OF FUNDS FOR THE SINGLE FAMILY CONSOLIDATED RFP APPLICATION FOR HARVEST HILLS HRA Specialist Tracy Jones gave an overview of the status on the uncommitment of funds for the Harvest Hills project. Housing Manager Barnes stated the reason we were not funded by the Minnesota Housing Finance Agency (MHFA) was because they had a question with the financial feasibility of our application. He stated this is a large developer and their costs are set. He stated with future projects we would work more closely with the developers to provide us with the financial breakdown. Chair Henderson asked if the MHFA didn't agree with the price we put on the unit. Housing Manager Barnes stated we didn't have a breakdown of the development cost from the developer as requested under the Request for Proposal. Executive Director Hurlburt stated the developer would have to disclose their costs and profits to make this work. Housing Manager Barnes stated the HRA will continue to look for other opportunities. MOTION by Commissioner Michlitsch, seconded by Commissioner Hewitt, recommending the Plymouth Housing and Redevelopment Authority Board of Commissioners uncommit local funds toward the Harvest Hills project. Vote. 5 Ayes. MOTION approved unanimously. C. FOLLOW UP DISCUSSION REGARDING FUNDING OPTIONS TO ACQUIRE PROPERTIES SUBJECT TO THE RIGHT OF FIRST REFUSAL CLAUSE Housing Manager Barnes stated at the last HRA meeting it was discussed to research the possibility of setting up a line of credit with a local lending institution. He stated staff contacted Anchor Bank regarding this. He stated if we secure a line of credit with Anchor Bank, the HRA would have to provide a guarantee in the amount equal to the line of credit because the HRA would only be holding the property for a short time and would not be able to secure the funds borrowed with the property. He also informed the Board that there would be an annual fee depending on the amount of the line of credit. Housing Manager Barnes indicated that the interest rate would be prime or prime plus one. Housing Manager Barnes also informed the Board that there are funds available in the HRA reserve accounts. He stated there is approximately $400,000, of which the City likes to keep approximately 40% of the tax obligation in reserve for cash flow. He stated there is a possibility to have $200,0004250,000 set aside for this purpose. However, with this option there may be lost opportunities. He stated the last option is to use the City as the lender. He stated the HRA Board could make a request to the City Council to give the HRA the ability to draw up to a certain amount from the City reserve to acquire properties that are subject to the right of first refusal clause. Plymouth Housing and Redevelopment Authority April 18, 2002 Page 3 Executive Director Hurlburt stated if we use the City's reserve the City is acting as the bank and we would have to pay interest. She stated whatever the City is earning for interest is what the HRA would have to pay. She stated the City wouldn't lose any money from its investment. Executive Director Hurlburt stated it would be a temporary loan. Commissioner Ludovissie asked if there is any conflict of interest in having the City act as the lender. Commissioner Hewitt stated she didn't see any issues. Executive Director Hurlburt stated there really is no risk to the City. Housing Manager Barnes stated Anchor Bank would require the HRA to pledge our reserve account against the line of credit or provide collateral. Commissioner Ludovissie stated he felt it would be easier if the City would be willing to act as the bank. Housing Manager Barnes stated we currently have 5 units in the Village of Basset Creek and will have 25 units at the Reserve that are subject to the covenants. Executive Director Hurlburt suggested we could ask for up to $500,000 at a time. Commissioner Ludovissie asked how much can we reasonably spend to acquire affordable housing. Housing Manager Barnes stated it would cost $3,000- 5000 to maintain the unit as affordable. Chair Henderson stated we have 3 options: 1) go to the City Council for a line of credit, 2) go to a bank, or 3) draw on our own reserves. Chair Henderson stated if we have reserves, why do we have to go to the City for a line of credit. Executive Director Hurlburt stated the City and HRA would like to keep 40% available in reserves and we don't always have that much. Commissioner Ludovissie stated we should prioritize and have a better idea for the next project that comes up. He stated we could use our reserves now, and go to the City at a later date if we need to. Executive Director Hurlburt stated we would have to at least set it up so it was available when needed. She stated we would need a resolution authorizing it. Commissioner Ludovissie stated he felt we should look at the HRA reserve first. Housing Manager Barnes stated there may be times when we could only fund a portion of the acquisition out of the HRA reserves but then would have to go to the City funding for the remainder. Chair Henderson stated she would like to move forward to City Council and request the line of credit. MOTION by Commissioner Ludovissie, seconded by Commissioner Bildsoe, to direct staff to prepare a resolution authorizing the use of the HRA's reserves and direct staff to prepare a request to the City Council for a line of credit up to $500,000 to use for acquiring properties subject to the right of first refusal clause. Vote. 5 Ayes. MOTION approved unanimously. D. INTERFAITH OUTREACH AND COMMUNITY PARTNERS REQUEST FOR ADDITIONAL ASSISTANCE FOR THE ANDERSON PROPERTY RELATED TO THE COUNTY ROAD 101 HOMES Housing Manager Barnes stated at the December, 2001 HRA Board meeting a motion was approved setting aside $20,000 from the HRA First Time Homebuyer Program to be used by Interfaith Outreach & Community Partners (IOCP) in their efforts to purchase property located at 17915 -30th Place North for the purpose of rehabilitation and sale to a first time homebuyer. He Plymouth Housing and Redevelopment Authority April 18, 2002 Page 4 stated since IOCP was not funded through the MHFA, they are requesting an additional $5,000 to assist them with this project. Chair Henderson asked what fund the money comes from. Housing Manager Barnes stated the HRA budgets for housing grants and there are funds available. Commissioner Michlitsch asked if the home would be moved. Housing Manager Barnes stated the home would not be moved. He stated the house is located on the south side of 30th Place North. He stated the home is a rambler built in the 60's and has gone through some upgrades to the exterior, but is in need of some repairs and upgrades to the interior. Commissioner Ludovissie asked if there are any restrictions to the buyer if they sell the home in the future. Ms. Hoy of Interfaith Outreach stated the agreement is if they sell within 10 years they can't re -sell the home for more than they purchased it for. MOTION by Chair Henderson, seconded by Commissioner Michlitsch, to approve the request for additional funding to Interfaith Outreach & Community Partners. Vote. 5 Ayes. MOTION approved unanimously. 5. OTHER BUSINESS Housing Manager Barnes gave an overview of the upcoming events and projects. He stated the new HRA Specialist would be starting on Monday, May 20th, putting the HRA at full staff He gave an overview of the County Road 73 meeting held on Monday, May 13th Commissioner Bildsoe asked about the Plymouth Towne Square rents and if we had any reactions regarding the changes. Housing Manager Barnes stated for the most part there were no issues brought up. Executive Director Hurlburt stated we will continue to attend resident meetings and be available for any concerns that are brought up. Commissioner Bildsoe asked how the management company is doing. Housing Manager Barnes stated they are doing well and are very responsive to the residents and any concerns they may have. He stated since we made the changes in Plymouth Towne Square, the calls have decreased dramatically. He stated Larry Jacobson of the Finance department stated it was going well on the financial side. Commissioner Ludovissie asked if the roof problems were being addressed. Housing Manager Barnes stated Sela Roofing had been out to repair the water damage. He also stated he met with the electrician and roofing contractor to discuss the heat tape project. He stated we might have a revised bid for the installation of the heat tape. 6. ADJOURNMENT MOTION by Commissioner Bildsoe, seconded by Commissioner Michlitsch, to adjourn. Vote. 5 Ayes. MOTION approved unanimously. The meeting adjourned at 7:55 p.m.