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HomeMy WebLinkAboutCommunity Development Block Grant Commission - Minutes - 01/08/2004CITY OF FORT COLLINS COMMUNITY DEVELOPMENT BLOCK GRANT COMMISSION Meeting Minutes January 8, 2004 Phil Majerus, Chair Bill Bertschy, City Council Liaison Chair Phil Majerus called the meeting of the Community Development Block Grant Commission to order at 6:30 p.m., at 281 North College Avenue, Fort Collins, Colorado. Board members present included: Chair Phil Majerus, Robert Browning, Bruce Croissant, Billie Mitchell, Tia Molander, Jeff Taylor, Dennis Vanderheiden, and Jennifer Wagner. Staff present: Ken Waido, Heidi Phelps. CITIZEN COMMENT No citizen comment was offered. WELCOME NEW COMMISSION MEMBERS Jeff Taylor and Jennifer Wagner exchanged introductions with the current members of the Commission. Mr. Taylor is a mortgage lender. He has resided in Fort Collins since 1979. He has experience with the Affordable Housing Board and the Fort Collins Housing Authority. Ms. Wagner has worked with First National Bank and has been a Fort Collins resident all her life. Mr. Majerus gave the new members a brief overview of the Commission process. APPROVAL OF OCTOBER MEETING MINUTES Moved by Mr. Browning, seconded by Ms. Rosen: To approve the October 2003 minutes. Motion approved unanimously. PUBLIC HEARING Ms. Phelps explained that the purpose of this section of the meeting is to receive input from agencies as to the upcoming funding cycle. Project Self -Sufficiency Mary Carraher of Project Self -Sufficiency explained the function of her organization. PSS works with single -parent families. Presently, those single parents in the program are all female, although there are single dads currently in the application process. The service provides for career planning, such things as car repair, and life skills. 95 families have been enrolled in the past. Increased funding has allowed a 10% program increase, and the program is now inching Community Development Block Grant Commission Meeting of January 6, 2004 Page 2 toward 105 families. This cycle marks the first time in five or six years that the program has been able to increase its capacity. Ms. Carraher outlined the staffing positions and dynamics of the program. She has been in the program for 14 years, and has help from a part-time assistant for the first time. Child care, particularly for low-income single -parent students, is at a crisis level. This benefit has been eliminated for every student. The program has been exploring options to replace some of that needed assistance. The Bohemian Foundation has worked to fund some of those families, with three participants presently receiving funding. PSS has $5,000 of its own funds available to distribute to families in January. This amount will not stretch to any extent, but it represents a beginning. The program is hoping to receive funding from other sources. PSS continues to have car repair clinics with Fleet Management Service of the City every six to eight weeks. The City mechanics offer help on their own time, and their fine efforts are highly appreciated. Ms. Phelps noted that day-care ranks high on community needs and services. A single parent was featured in PSS's community report who earned her doctorate in veterinary medicine. This could not have accomplished without child care assistance. Although the likelihood of success was low, her determination, scholarships, and other assistance made it possible. She was able to graduate using fewer student loans than the average veterinary student. Mr. Majerus and Ms. Carraher reminisced about the changing status of the program through the years. The program's 60-client base in the past represented 30 clients from Fort Collins and 30 from Loveland. The level has crept up to 95 for the last five years. The CDBG Commission has helped the program to grow. Fort Collins and Loveland shared the cost on an equal basis that allowed for the hiring of a staff person who helped to bring up the program's numbers DREAM, Inc Melinda Suits introduced a new nonprofit organization: DREAM, Inc. This program is designed to provide respite care, education, and advocacy for families with children with mental health problems. Ms. Suits has been the Fort Collins facilitator for these issues for approximately a year. Fort Collins presents a real need for these services. Mental health problems often generate difficult or violent issues. Many single -parent households are in this situation. Respite care is the primary focus of the program's efforts. When the family's needs in these issues are not being met, the children often run afoul of authority. Community Development Block Grant Commission Meeting of January 8, 2004 Page 3 Ms. Suits' partner is a licensed therapist. Ms. Suits has business background and an adopted son with a disability. She has good contact with the Bohemian Foundation. The program will be submitting for a grant and appreciates any support which is offered. In response to questions by the Commission concerning the status of the program, Ms. Suits stated that many families have presented with high needs. The organization has just submitted for 501(c)(3) status. It receives agency help from Denver for grant writing. The program is hoping to be up and running in the fall. If a building is not available, the workers will go to clients' houses or the program will have a co-op arrangement. Many of the schools need education for this population as it becomes mainstreamed. The program will speak to community organizations. The purpose of the program is early intervention, to advise families in dealing with these issues, to provide for proper education, to help manage medication, and to teach the affected children to function within society and thereby keep them from being institutionalized due to failure to deal with their disabilities. TURNING POINT Ms. Phelps gave background on this issue The CDBG contract was awarded in FY 2002. Turning Point then purchased a six -person apartment complex on Stuart Street. During implementation of the grant, Turning Point has seen impacts from state grant cuts and changes to the program. No impact has been critical, but there have been more changes than make it comfortable for staff to handle administratively. The applicant has been operating at a proactive level to keep the Commission informed. Ms. Phelps outlined three areas of concern: 1) The configuration has been changed to not provide, as before, a full-time, income -qualified resident manager. The changes may result in loss of a housing unit. 2) Challenges involving building rehabilitation are not a direct concern but may speak to how the units will be filled. The project is still in an acceptable time frame. 3) Clarification has been sought regarding working with end -stage kids. Kids are apparently working full-time. Variations exist for full-time, part-time, and school. At this location, the service needs to be more of a housing transition program rather than a residential treatment center. Ms. Phelps summarized: The Commission needs to decide whether the loss of one unit is acceptable. Community Development Block Grant Commission Meeting of January 8, 2004 Page 4 Mr. Jim Becker, Executive Director for Turning Point, presented the Commission with further background. He noted that it has been almost two years since his last visit. He provides the CDBG program with an annual report for its records and for ongoing information. Turning Point was named Larico until eight years ago. It is a treatment facility for kids aged 12 to 21. It is a State -approved child-care and treatment center. Turning Point has faculty on -staff to train for drug and alcohol certification. The program has 110 employees, a $5 million budget, and serves 100 kids per day. Mr. Becker expressed his gratitude for the funding approved two years ago for housing. The program had requested $132,000 for an apartment building not yet identified. Program participants nearing graduation were having a difficult time transitioning into the community, since it was difficult to rent without prior rent history. The Commission approved a $100,000 loan without having a building identified. Mr. Becker distributed an information flier for 207 East Stuart Street. The building has six units: Two, two -bedroom and four one -bedroom. The total cost was $421,000 including the set -aside. This cost included closing and rehab. This was to be funded by a grant, which was turned into a loan. This process was an education effort and provided for a worrisome amount of liability. Funding was received from the State Housing Department, no funding from CHFA, and community support was encouraging. The program also dipped into its reserves. The property was identified in May 2002. It was scheduled to close in October, but closing was delayed to February 2003. A hearty amount of negotiations were involved. Ms. Phelps was kept informed of all developments during their occurrence. The program continually monitored the eligibility of its clients. In February, five eligible renters were in place. Existing renters at this building stayed; units became available through attrition. Remodel began upon the present tenants vacating. A number of rehab issues were encountered and drove the cost per unit to unacceptable levels. Rehab has continued on a piecemeal basis as funding allows. The program's goal was to have units empty by September or October in order to begin rehab. A split program then existed between renters who had oversight needs and those who did not. The original building layout contemplated an all -boys facility, with a live-in, assistance -qualified house manager. Cuts in State funding reduced the ability to accomplish that goal. The program also received pressure to serve emancipation -level girls and has evolved away from an all -male program. The Community Development Block Grant Commission Meeting of January 8, 2004 Page 5 new building configuration is split, with the resident manager's office in the center, girls' programming on one side, and boys' programming on the other. The number of girls has sometimes exceeded the number of boys. Because of the program dynamics, five units are now needed instead of six. Without a staff manager's office, with staffing 24 hours a day, it was very difficult for young adults to comply with the program. Stretching the limits became too easy and too much of a temptation. The result was a situation no longer akin with low-income housing. The programming has been built up and needs more program tenants. Community renters have not been on long-term leases. Some renters had six- month leases, and wrap -around situations existed, with language regarding compliance with guidelines. The original proposal envisioned eight units and could only find a building with six units. All programs are in place except for where the live-in house manager has been replaced with a manager's office. The original proposal did not anticipate the organization of third -party payers and users of the system. This structure works nominally well, with subsidy provided by a particular agency. The program successes: No residents were displaced; the program and funding is in place; the program serves both males and females; and the program is beginning to find its proper level of stability. Mr. Becker gave an overview of the funding cuts that have led to adjustment and reassessment of priorities. He related the contacts he maintains to ensure proper financing and programming. An example was offered of a client situation. A 17-year-old young man, with no family present, just arrived at the group home. His 18th-year birthday will be in April 2004, at which point he will be without services. He would ordinarily be taken through the program to help with obtaining his GED and learning life skills. The program's hope is that Social Services will help pay for wraparound services so that this client can be properly emancipated, with applicable life skills, by the end of summer. Due to funding cuts, fewer kids are accessing the program with the help of third - party payers; instead, they are left unattended. This lack of direction and support promotes homelessness, financial dependence, and contact with the criminal justice system. Community Development Block Grant Commission Meeting of January 8, 2004 Page 6 In response to questions by the Commission, Mr. Becker stated that the kids in the residential program are usually referred by Social Services. Some may be products of the criminal justice system. Referrals are traded with other agencies. It is difficult for youthful residents without good credit to find places to rent outside of the system. By law, one can be emancipated if 16 years or older. In August, the program was losing $8,000 per month. The program suffered between the manager issue and low rents. The program is meant to grow for the program kids, but the door is open for non -program kids. Low-income units were provided to help with that problem within the community. There have been some issues surrounding ongoing, non -program renters, and renters involved in Turning Point's program. If drug use was found with ongoing, non -program renters, the violators could not be moved out immediately. There are court processes and Fair Housing Act regulations that have an effect in this area. If drug use is found with a program participant, it is a program violation. For new, non -program applicants, Turning Point is checking references more carefully. Ongoing renters could not be forcibly moved without expensive relocation costs, so those moves were kept voluntary. Leases with new residents can be structured to ensure compliance with the program. Turning Point is presently only in Fort Collins. It has additional facilities at: Shields and Plum; Matthews; Prospect; and South College. These facilities are used for treatment, administration, or residential. A distinction is made between group homes and apartments. The whole process for this location is taking longer than desired, but Turning Point continues to be excited with this location. Another funding request for a group home may be in the program's future. The program currently has one non -program renter, with another one the way. New applications are being seen from other community collaborators. Some applicants are older and will be paying their way. Ms. Phelps gave an overview of the scope of services, the contract, the ongoing work with the Division of Housing, the goals of transitional housing, the qualifications, and the constraints. The on -site staff manager position is not described as income -qualified. The property has affordability assurances over the next 20 years. The mechanics of the motion was discussed. The request is to drop one unit from the application. The policy for this application will be drafted in accordance with the motion. Mr. Becker noted the difficulty of the building layout and the need for a manager's unit in the middle. Ms. Phelps noted the evolution of this request through the practical and bureaucratic layers. A one -bedroom unit could have a maximum of two Community Development Block Grant Commission Meeting of January 8, 2004 Page 7 residents; a two -bedroom unit could have a maximum of three residents. Staff will need to know the final numbers to placate the Federal requirements. Moved by Mr. Browning, seconded by Ms. Rosen: To approve the request for a change in the scope of services by Turning Point to provide for five units to service low- to moderate -income clients. Motion approved unanimously. ELECTION OF OFFICERS Mr. Majerus opened nominations for Chair. Nominated by Ms. Molander, seconded by Mr. Vanderhelden: Phil Majerus. No other nominations were offered. Phil Majerus elected unanimously, with Ms. Wagner abstaining, due to her newness to the Commission. Mr. Majerus opened nominations for Vice Chair. Nominated by Ms. Molander, seconded by Ms. Rosen: Bob Browning. No other nominations were offered. Bob Browning elected unanimously, with Ms. Wagner abstaining, due to her newness to the Commission. OTHER BUSINESS Legal residence status An issue was raised on whether criteria concerning legal resident status should be a part of a program's process and the evaluation by the Commission. Federal oversight does not prohibit such criteria. The Fort Collins ordinances do not allow for such a query in the funding process. This applies to both housing and social services programs. It was noted that residence status often is seen in the tax credit compliance processes. Anticipated Funding Ms. Phelps stated that the expectation received by Staff was that CDBG and HOME funding will remain close to last year's levels. Beaucaire Ms. Phelps reviewed the ongoing twists and turns of this applicant's process. Beaucaire is an agency that serves very high -risk youth. The Commission approved down payment money to purchase a residential center on Cherry Street. Staff spent a great deal of time to ensure that proper progress was made concerning the property aspects. Community Development Block Grant Commission Meeting of January 8, 2004 Page 8 The property closed on October 8th. On October 10th, the facility's license was suspended by State for numerous violations. Even if Beaucaire appeals that decision, it cannot be engaged as a residential treatment center for a minimum of one year. The property is being actively marketed. It needs to be sold to pay off the mortgages. First National Bank is in first place; CDBG is in second place and stands to lose the most. A sale through a Realtor would result in a further loss due to the sales commission, although the listing Realtor has agreed to a reduced commission if he is the sole agent involved. The sale price has decreased from $190,000 to 165,000, the approximate amount of Beaucaire's purchase; however, costs reduce the net of that figure by $11,000 to $12,000. The Commission's options are limited. Presently, it is hoped that $23,000 may be recouped from the $32,000 granted. Foreclosure and buying the property have been considered, but priority and structure issues render those solutions infeasible. The best course of action may be to stem any further losses and move on from this experience. The following salient comments were made in the ensuing discussion: It may provide a lower gap to sell the paper on the second mortgage rather than suffer the gap from the sale price. The Realtor is related to the seller (brother), and records will be checked to verify who the ultimate buyer is. The applicant represented that the property price was below market. Ms. Phelps felt that the appraisal was too high and was accused of being slanderous to the appraiser. The CDBG program is seeing a reduction in loss due to the loan program. Had a grant been issued, no moneys would have been realized. In the history of the Fort Collins CDBG program, a $10,000 loss should not be considered appalling. Staff will attend the property closing. Not surprisingly, First National Bank is not willing to share in the shortfall. In further discussions, Staff and the Commission members reviewed the lessons to be learned from this experience: Tighter rein on appraisals until a comfort level is reached. Tighter scrutiny on funding sources. Evaluate for a break-even minimum occupancy level. Staff noted that the State Dept. of Human Services considers this a highly unusual circumstance. Agencies cannot be flagged for potential trouble. Community Development Block Grant Commission Meeting of January 8, 2004 Page 9 ANNOUNCEMENTS Neighbor to Neighbor is selling property to John XXIII Catholic Church. Rusty Collins has resigned from his executive director position and will take on new duties as the executive director for the Bohemian Foundation. This is seen as a win -win situation for affordable housing development. Newspaper notices, postcards, Web site announcements, and training announcements have gone out for the next funding cycle. This cycle may see an increase in public facilities requests. Staff toured Wingshadow, a teen shelter, that may have a presence in the next funding round. Land bank requests may not be seen. CDBG funds cannot be used for land banking. Staff is not yet being overwhelmed with housing applications. Julie Smith distributed the Consolidated Annual Performance Evaluation Report. It is reviewed in excruciating detail by HUD. No red flags are seen. Mr. Waido noted that the Commission oversees the top -rated HOME program in the state for like -sized cities. The February meeting may not be held due to a dearth of items. The March meeting will be busy with new applications. The meeting adjourned at 8:00 p.m.