HomeMy WebLinkAboutHousing & Redevelopment Authority Minutes 08-21-2003MINUTES
PLYMOUTH HOUSING AND REDEVELOPMENT AUTHORITY
August 21, 2003
PRESENT: Commissioners Susan Henderson, Steve Ludovissie, Tim Bildsoe, Leon
Michlitsch, Jenny Hibbard
ABSENT: None
STAFF PRESENT: Executive Director Anne Hurlburt, Housing Program Manager Jim Barnes,
Office Support Representative Barb Peterson
OTHERS PRESENT: Grace Management Representative Jody Boedigheimer, Mark Updahl,
Senior Building Consultant and Erik Ennen, Building Specialist, representing the Center for
Energy and Environment, Program Participant Kristine Aritt
1. CALL TO ORDER
Chair Henderson called the Plymouth Housing and Redevelopment Authority meeting to order
August 21, 2003 at 7:00 p.m.
2. APPROVAL OF MINUTES
MOTION by Commissioner Bildsoe, seconded by Commissioner Ludovissie, approving the July
17, 2003 minutes.
Vote. 5 Ayes. Motion approved unanimously.
3. CONSENT AGENDA
A. Plymouth Towne Square — Accept monthly housing reports.
B. 2002 Community Development Block Grant (CDBG) Consolidated Annual
Performance and Evaluation Report (CAPER) and Notice of Annual Citizens'
Participation Meeting.
MOTION by Commissioner Bildsoe, seconded by Commissioner Michlitsch, approving the
Consent Agenda items.
Vote. 5 Ayes. Motion approved unanimously.
4. NEW BUSINESS
A. Plymouth Towne Square (PTS) Building Evaluation
Chair Henderson welcomed the guests from the Center for Energy and Environment.
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July 17, 2003
Page 2
Housing Manager Barnes said that during discussions early in 2003 regarding the upgrading of
Plymouth Towne Square, the Board discussed reserve accounts and how to determine if the
balances of those accounts would be sufficient to cover future maintenance and repairs. The
Board decided that an evaluation of the building and all major components should be performed
to make sure the correct amount of reserves are being set aside. Grace Management
Representative Boedigheimer said she met with Mr. Updahl and Mr. Ennen from the Center for
Energy and Environment, discussed what process would be followed, and hired them to
proceeded with the evaluation. Ms. Boedigheimer said the building was inspected on July 8,
2003 and the results are included in booklets which the Commissioners have received.
Mark Updahl, Senior Building Consultant with the Center for Energy and Environment
presented background information on their organization.
Mr. Updahl said he had looked at Plymouth Towne Square about two years after the building
was constructed so he is familiar with the building. Mr. Updahl said the main purpose of the
inspection is to find out what is happening in the building which will impact the future. He
indicated they found Plymouth Towne Square very typical for a ten year old building. The
architecture was aesthetically pleasing but the design of the roof was flawed.
Mr. Updahl said the boilers are in reasonably good condition but how they are controlled could
be improved and the water heaters will need to be replaced soon. He felt that overall the
building was in fairly good condition.
Housing Manager Barnes explained that there are many other components in the building that
may need updating, such as soft goods, and a comprehensive list of all items will be provided for
the Commissioners. Mr. Barnes said that once a list is compiled it will provide a good idea of
the amount needed to be put away in reserves. Commissioner Ludovissie said he felt the report
was very good and that many of the items noted should be dealt with fairly quickly.
Chair Henderson asked if they tested the air quality. Mr. Updahl said that the air quality was
good, but overheating on the third floor was a problem. Mr. Updahl stated that nothing unusual
was found in their inspection, however, he is concerned about the moisture intrusion in the
building and thought the problem may still be occurring. Discussion occurred regarding the
heating of the building in comparison to other senior buildings. Mr. Updahl stated that higher
than normal costs of heating water is because one water heater is not working efficiently.
Housing Manager Barnes asked Ms. Boedigheimer if there were any water leaks this past winter.
She said there were not any that she knew of.
Commissioner Ludovissie asked about attic ventilation. Mr. Updahl said it is much improved
and did not feel that ventilation was a concern any longer. Housing Manager Barnes asked if the
Center for Energy and Environment took into consideration that this is a senior building and the
fact that seniors may like their environment warmer. Mr. Updahl explained the dynamics of a
buildings, and how the costs are determined by how many residents are home all day and how
their activities generate heat. Mr. Updahl said a few residents could be driving up the heating
bills by keeping windows open, etc. He suggested training staff to detect that type of problem.
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July 17, 2003
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Chair Henderson asked how the heat is regulated in building. Mr. Updahl said the heat is
independently controlled by each apartment and is a good system. Chair Henderson asked if
recommendations would be made regarding this report. Housing Manager Barnes said staff will
compare this report against other data and compile the information. Commissioner Ludovissie
asked about the time frame and if it would cover five or ten years. Housing Manager Barnes said
the time frame would be based on life expectancy of particular systems. Ms. Boedigheimer
mentioned that the Center for Energy and Environment provide specialized training on site for
staff and she said Plymouth Towne Square has a very good maintenance person now on staff.
Commissioner Bildsoe asked about the improvements which the Board had talked about
previously regarding decorating. Grace Management Representative Boedigheimer said they are
on hold until a decision is made on how to phase the items in over time. Ms. Boedigheimer said
the residents objected to moving the exercise room to the third floor. Commissioner Bildsoe
stated that he thought the tables would have already been purchased. Discussion occurred
regarding changes that could be made to the game room. Commissioner Ludovissie asked if the
activities could be monitored to determine what the needs would be. Ms. Boedigheimer said
cards and Tai Chai are the most popular activities. Housing Manager Barnes suggested asking
the residents what changes they want. Commissioner Bildsoe suggested sending out a survey.
Commissioner Hibbard suggested offering options on the survey. Discussion occurred regarding
lighting and tables. Director Hurlburt suggested looking at the tables at Plymouth Creek Center.
Commissioner Hibbard asked what other improvements could be done while waiting for the
survey to be completed. Director Hurlburt recommended not doing anything except purchasing
tables until the survey is completed. Housing Manager Barnes said an overall analysis will be
provided at the September Board meeting.
B. First Time Homebuyer Program Loan Subordination Request and Appeal
Director Hurlburt said the Board is being asked to review a staff action appeal by Kristine Aritt,
a First Time Homebuyer loan participant. Director Hurlburt said the home was purchased under
the affordability gap financing and the program required that future affordability of the homes be
preserved by resale restrictions set through Restrictive Covenants placed on the property. A
problem occurred when the document was not presented for signing with other documents at the
closing. Staff discovered this had happened with a number of the homeowners and the owners
were asked to cooperate in correcting the problem by signing a consent to record the covenants.
Ms. Aritt refused to sign the consent to allow recording of the covenant. Director Hurlburt said
on advice of the City Attorney the HRA had the discretion to have the mistake corrected as part
of the subordination request.
Commissioner Bildsoe felt the current subordination policy was explicit already. Director
Hurlburt said the current guidelines say we "may subordinate loans under certain circumstances"
but the question is whether one of the written criteria should be cooperation in correcting any
errors or omissions. Commissioner Bildsoe said he was referring to the notice given regarding
the covenant prior to closing. Director Hurlburt said that was one thing she looked at when this
issue came to her and found the information had been given to prospective buyers at the meeting
with Rottlund.
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July 17, 2003
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Ms. Aritt stated that she trusted there were no restrictive covenants on the property and said she
probably should have gotten something in writing. Ms. Aritt said that her co-worker, HRA
Specialist Jones, told her there was nothing to be concerned about. Ms. Aritt said she was
surprised to get the letter on March 7, 2003 stating the covenants were unrecordable and
questioned what that was about. Ms. Aritt said her loan officer told her that the City can't make
her sign the document now. Ms. Aritt said she is trying to refinance now and is being requested
by staff to sign the restrictive covenant document before the City will subordinate.
Commissioner Hibbard asked about the twelve other people who this happened to and Director
Hurlburt replied that eight had signed and four have not. Director Hurlburt said that Ms. Aritt is
the first person to request a subordination and we will make the same condition on the other
three should they request subordinations. Discussion occurred on how the error happened and
what the outcome would be if Ms. Aritt does not sign the agreement. Director Hurlburt said that
at the time of closing, staff was not having the homebuyers sign an errors and omissions
agreement so they could not go back after the closing and have people sign. Commissioner
Hibbard asked what the signing of the restrictive covenant would do to the subordination and
why Ms. Aritt is reluctant to sign. Ms. Aritt said if she signs the restrictive covenant, she could
only sell the home for the appraised value and would need to sell the home back to the HRA.
Director Hurlburt said if the covenant is not signed she would be free to sell the home at any
price the market will bring and the covenant was designed to give some affordability by
requiring owners to sell to a homebuyer meeting the qualifications for afordability and giving the
HRA the right of first refusal. Director Hurlburt said that if the City does not subordinate then
she will have to pay off the loan in order to refinance.
Chair Henderson asked Ms. Aritt if she was at the Rottlund Lottery meeting. Ms. Aritt stated
that she was but does not remember seeing or hearing any information about the covenant at the
meeting. Commissioner Bildsoe asked about the power point information sheet and also about
the Affordability Gap Financing brochure that was included in the HRA packet. Director
Hurlburt said that she understands the information was presented at the Rottlund Lottery meeting
and the brochure was given to all prospective homebuyers. Ms. Aritt said she doesn't remember
receiving the information.
Director Hurlburt said that Ms. Aritt cannot be forced to sign the covenant at this time but the
City can refuse to subordinate.
Commissioner Bildsoe said his concern was that the covenant had been discussed and an
oversight came about at the closing when the covenant was not signed. However, he stated that
the purpose of the First Time Homebuyer loans was to keeping affordability of the units and the
HRA's intent is to preserve the affordability and the HRA is asking her to comply with
something that was intended at the beginning of the process.
Commissioner Hibbard asked for clarification of the affordability process. Housing Manager
Barnes explained the process. Chair Henderson asked about other first time homebuyers for
single family homes. Housing Manager Barnes explained that affordability covenants are
typically used in larger developments where we can work out agreements with the developer.
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July 17, 2003
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Commissioner Hibbard asked how the first time homebuyer loan works and what are initial
interest is when we get involved. Housing Manager Barnes said that in this case we have a
deferred loan out for $17,000.00 to Ms. Aritt that becomes payable if she moves or the property
is no longer her permanent residence. Commissioner Michlitsch said he feels bad for Ms. Aritt,
but in his opinion the HRA has the right to ask her to correct the situation. Commissioner
Hibbard agreed and felt there was an implied agreement that was made based on a financial
agreement between Ms. Aritt and the HRA and that it would be improper to let this go through
and it would be a good faith intent on Ms. Aritt's part to sign the document. Ms. Aritt said she
feels she is being punished by being required to sign the covenant. Commissioner Ludovissie
said she is not being required to sign but the Board probably will not subordinate if she doesn't.
Chair Henderson said she is not willing to lose an affordable unit.
MOTION by Commissioner Michlitsch, seconded by Commissioner Bildsoe, upholding the staff
decision to require execution of a restrictive covenant as a condition of subordinating Ms. Aritt's
First Time Homebuyer second mortgage to a first mortgage.
Vote. 5 Ayes. Motion approved unanimously.
C. Draft Subordination Policy Revisions
Housing Manager Barnes said that staff has drafted additional language to be added to the
subordination policy sections of the First Time Homebuyer Program and the Housing
Rehabilitation Program.
Housing Manager Barnes said the first proposed change addresses cash out refinances to be used
for additional purposes. Under current guidelines at least 80% of cash received from a loan
refinance must be used for home -improvement related expenses. Staff has drafted language
giving the HRA's Executive Director discretion with this requirement. Director Hurlburt gave
examples of reasons that would significantly improve their overall financial situation. It would
not be for such recurring types of expenses such as getting out of credit card debt and then run
debt up again. Commissioner Ludovissie asked if the sentence should include some language to
make it a longer term improvement for their financial situation. Director Hurlburt said "long-
term" could be added to the proposed language.
Housing Manager Barnes said the other proposed change addresses the responsibility of the
borrower(s) to correct any errors and omissions relating to their loan. Chair Henderson asked
whether the policy needs to say anything about outstanding errors or any errors. Director
Hurlburt said the policy was written by our Attorney and she said he doesn't feel we really even
need this in writing to do so.
MOTION by Commissioner Bildsoe, seconded by Commissioner Michlitsch, approving
Resolution 2003-13 to accept the subordination policy revisions for the First Time Homebuyer
and the Housing Rehabilitation Guidelines with the added wording of "long term" to the
revisions
Vote. 5 Ayes. Motion approved unanimously.
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July 17, 2003
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D. Strategic Planning Evaluation of Current Human Services
Housing Manager Barnes said that part of the strategic plan was to evaluate what human services
and social services were available to Plymouth residents. The goal was to provide a list of
agencies serving our community. Mr. Barnes said a list is provided in the spreadsheet attached
to the staff report and the shaded ones are actually located in Plymouth. This information will be
incorporated into rehab and first time homebuyer information packets and will be updated on an
annual basis. Chair Henderson asked which agencies the HRA funds. Housing Manager Barnes
said we will be looking at this list to see who the City and HRA are funding. We will also look
at the Consortium five-year Comprehensive Plan to determine if there are areas in which we are
not meeting our goals. Commissioner Bildsoe said he would like to see a category under mental
health. Chair Henderson suggested a category for health coverage also. Discussion took place
regarding how detailed this list should become.
E. 2004 HRA Budget Update
Housing Manager Barnes said the information in the staff report is what the City Council
received and will be discussed at the upcoming budget meetings. Commissioner Ludovissie
asked if we were adopting this budget tonight. Director Hurlburt said that she doesn't
recommend adopting the budget at this time, as there could be changes by the Council.
F. Housing Week.
Housing Manager Barnes said the City Council is going to be working with Interfaith Outreach
in "Housing Week" planned for November 15-22. The City Council has asked the HRA to
participate. They are planning a sleep out in Plymouth. The Board agreed that the HRA should
be involved with this event.
5. NEW BUSINESS
Housing Manager Barnes asked the board if they would be interested in owner occupied or rental
for the property they have been talking about purchasing to develop. The consensus was owner
occupied.
6. ADJOURNMENT
MOTION by Commissioner Bildsoe, seconded by Commissioner Michlitsch, to adjourn the
meeting. Meeting adjourned at9:03 p.m.
HRA/Minutes/082103