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HomeMy WebLinkAboutHousing & Redevelopment Authority Minutes 09-19-2002MINUTES PLYMOUTH HOUSING AND REDEVELOPMENT AUTHORITY September 19, 2002 PRESENT: Chair Susan Henderson, Commissioners Steve Ludovissie, Leon Michlitsch, and Sandy Hewitt ABSENT: Commissioner Tim Bildsoe STAFF PRESENT: Executive Director Anne Hurlburt, HRA Specialist Tracy Jones, Office Support Representative Barb Peterson OTHERS PRESENT: Council Member Scott Harstad, Steve Fenlon representing West Lutheran High School 1. CALL TO ORDER Chair Henderson called the Plymouth Housing and Redevelopment Authority meeting to order September 19, 2002 at 7:04 p.m. 2. APPROVAL OF MINUTES MOTION by Commissioner Ludovissie, seconded by Commissioner Hewitt, approving the August 28, 2002 minutes. Vote. 4 Ayes. Motion approved unanimously. 3. CONSENT AGENDA A. Plymouth Towne Square — Accept monthly housing reports. B. Approve Revised Multi -Family Housing and Industrial Development Revenue Bond Financing Policies. MOTION by Commissioner Hewitt, seconded by Commissioner Michlitsch, approving the Consent Agenda items. Vote. 4 Ayes. Motion adopted unanimously. 4. NEW BUSINESS 4A. West Lutheran High School - Application requesting the Plymouth HRA issue "Bank Qualified" revenue bonds on behalf of West Lutheran High School. Director Hurlburt stated that West Lutheran High School has submitted an application requesting that the Plymouth HRA issue Industrial Development Bonds for the purpose of refinancing existing debt they currently have. She explained that at the August 28th HRA meeting the Board passed a motion to adopt the City bond policy, and formally adopted the written policy tonight. Plymouth Housing and Redevelopment Authority September 19, 2002 Page 2 Director Hurlburt presented background information regarding the proposal. The application fee and issuers fee will cover any expense for monitoring the bond issue over the years, and the applicant will reimburse any out-of-pocket costs. She said the City has issued bonds in the past for other organizations in Plymouth, however, not for a project like West Lutheran High School. Director Hurlburt said the Board should decide if the issuing of these bonds fits the mission of the HRA. Even though the HRA will hold the public hearing and the bonds will be issued in the name of the HRA they will require the Mayor's signature and the City Council will need to authorize the Mayor to sign the documents. Steve Fenlon, representing West Lutheran High School, gave a presentation explaining the financial process. Commissioner Ludovissie asked if they have sought private financing. He stated they have private financing in place but the interest rate is at 7%. He said the building will be used as collateral whether they use private funds or bonds. He explained the loan process and stated there is no direct financial impact to the HRA or the City, as all of the costs and fees are to be paid by the applicant. Mr. Fenlon stated that they use Anchor Bank and explained the financial status of West Lutheran High School. He said there is not any new construction associated with the bond issue. Commissioner Ludovissie asked what the total real estate value of the buildings is. Mr. Fenlon said it is approximately 5 million dollars but that schools are difficult to appraise. Commissioner Hewitt stated that this is a policy decision and questioned if that is the direction the HRA wants to go. She asked if they are planning to add more staff at the school, which would create more jobs. Director Hurlburt explained that some of the policies do not directly apply to this type of project. When West Health was financed it created new buildings and employees. The Board questioned how many other non profit organizations would want funds also. Director Hurlburt stated that the HRA will receive an application fee and 1/8th of a point for acting as the issuer. She said the law limits the amount of "Bank Qualified" bonds an entity may issue in any given year to 10 million dollars. This could become an issue if the HRA would want to issue bonds for another activity such as a housing development and the total would exceed the 10 million dollar cap. Discussion was held regarding what would happen if the deal does not close in 2002. Director Hurlburt explained that the bond issue could be conditioned upon it closing in 2002. Or, if it did not close and a bond issue in 2003 resulted in a cost to the HRA, there could be an agreement with West Lutheran for reimbursement similar to what the City required for a bond issue in a previous instance. Commissioner Ludovissie asked if the bond issue has come before the Council yet. Director Hurlburt said it has not. Chair Henderson stated that by helping the non-profit organization it helps the economic situation of the area. MOTION by Commissioner Hewitt, seconded by Commissioner Ludovissie, that the Board adopt the resolution relating to a refinancing under Minnesota Statutes Sections 469.152 through 469.165 on behalf of West Lutheran High School and the issuance of Industrial Development Bonds to refinance outstanding loans and calling for a public hearing thereon. Vote. 4 Ayes. Motion adopted unanimously. Plymouth Housing and Redevelopment Authority September 19, 2002 Page 3 4B. APPEAL EXECUTIVE DIRECTOR'S DENIAL FOR SUBORDINATION OF FIRST TIME HOMEBUYER LOAN. Director Hurlburt explained the guidelines of the First Time Homebuyer program for subordination of loans. The Board could make an exception to the rules. She explained that the HRA has already allowed flexibility from the loan to value ratio policy when a subordination request was granted in March of 2002, and the cash out policy to allow the homeowner to purchase a new handicap accessible van. This current request is for a cash -out home equity loan of $20,000, putting the HRA loan in third position. It would also raise the loan to value ratio to 102% which exceeds the 90% loan to value ratio required in the First Time Homebuyer program rules. Commissioner Hewitt said she is not comfortable with 102% and recommended that credit counseling be suggested. Commissioner Michlitsch agreed that the homeowner would benefit more from credit counseling than by the HRA approving the subordination. Director Hurlburt suggested providing the homeowner with referrals for programs that could assist her financial situation. MOTION by Commissioner Hewitt, seconded by Commissioner Michlitsch, that the HRA Board uphold staff s denial to subordinate a First Time Homebuyer second mortgage to a new home equity loan. Vote. 4 Ayes. Motion adopted unanimously. 4C. HRA STRATEGIC PLAN — Discuss format and timeline for updating Strategic Plan Director Hurlburt reviewed background information provided to the Board and requested that they give staff direction on the scope of the update, format of strategic planning sessions and discuss a schedule to do the planning. Director Hurlburt said she spoke with Commissioner Bildsoe and he had suggested we schedule a meeting in January and again at the mid point of the year to review progress on the strategic plan. He also recommended a special meeting sometime in the middle of November to update the plan. Chair Henderson does not think we need to begin from scratch but need to look at the action plan. The Board agreed that the Mission and Vision statements were probably fine the way they are written now She suggested the Commissioners make any minor changes to the existing mission and vision statements and fax their suggestions to Housing Manager Barnes before a meeting takes place. Commissioner Hewitt said she would like to look at land trusts, which seem to come up frequently. Commissioner Ludovissie stated that the Board should be concerned about spreading themselves too thin by doing too wide a variety of projects. He feels they should be more selective about what they want to work on and become more focused. Director Hurlburt said operations and on-going projects might need to be separated from new action items. Chair Henderson also thinks we need to focus on specific actions. Director Hurlburt suggested taking an inventory of what the HRA Board and staff do now and prioritize the opportunities we want to focus on. . The Board decided that they would work on the Strategic Plan at the regular Plymouth Housing and Redevelopment Authority September 19, 2002 Page 4 meeting on November 20, but start at 5:30 p.m. Staff was asked to reserve a room at Plymouth Creek Center if available. NEW BUSINESS Director Hurlburt gave an update on the part-time Section 8 position that is proposed to be full- time in January. She said staff may be requesting that the full-time position begin sooner than January and they will be bringing a proposal back to the Board for their approval. She spoke about the Sec. 8 position and how the program has grown requiring additional help. She also spoke about financial problems with the Minneapolis Housing Authority and how the situation will consume more Section 8 staff time. 5. ADJOURNMENT MOTION by Commissioner Hewitt, seconded by Commissioner Michlitsch, to adjourn the meeting. Meeting adjourned at 8:25 p.m. HRA/Minutes/091902