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HomeMy WebLinkAboutCommunity Development Block Grant Commission - Minutes - 02/08/1996Council Liaison: Bob McCluskey Staff Liaison: Ken Waido Chairperson: Co -Chairperson: Dan MacArthur William Steffes Phone: 667-2437 (w) Phone: 484-2662 w 490-1574 (h) 493-1674 (h) A regular meeting of the CDBG Commission began at 6:30 p.m. in the Community Planning Conference Room, 281 North College Avenue, Fort Collins, Colorado. The following members were present: Council Liaison Present: Bob McCluskey Commission Members Present: Dan MacArthur, Bill Steffes, Bill Bertschy, Linda Coxen, David Gordon, Violet Guthrie, Bobbie Guye, Tom Hartmann, Tim Ostic, Holly Sample, Joe Zimlich. Staff Members Present: Ken Waido, Advance Planning Jackie Davis, CDBG Dickson Robin, Advance Planning Julie Smith, HOME Mary Hile, CDBG Moved by Ms. Guye, seconded by Mr. Bertschy: To approve the minutes of January 11, 1996. Motion approved unanimously. Mr. MacArthur introduced new Commission member David Gordon. Mr. MacArthur stated that he had invited Mr. McCluskey to the meeting to help define: The Commission's goals; the current position of the Commission; and Council's expectations of the Commission. On his initiative, and in response to questions by the Commission, Mr. McCluskey noted the following: Historically, Council makes some revisions to the recommendations of the Commission. Production has always been a fundamental goal of the Commission in promoting affordable housing; that goal should not change. Regarding Pioneer, the Commission made a good decision based on the information before it. Pioneer presented a unique decision, and the Council action should not be taken as critical CDBG Commission Minutes February 8, 1996 Page 2 of the Commission. The Commission should apply its customary priorities in the next funding recommendations. Mr. McCluskey was not present for the meeting that City Manager John Fischbach arranged. In the future, the City will attempt to hold such meetings at a time when more people may attend. Council was faced with varying information -from many different sources and made a decision to refer the issue to the Commission for further review. Council did not propose a meeting of different agencies and entities involved. That initiative came from John Fischbach, in an attempt to utilize a give-and-take process that is not available at Council meetings. Commission members expressed concern that if appropriate decision -making involved discussion, lobbying, and consensus by interested parties, perhaps such a procedure should be used in future CDBG decisions. Mr. McCluskey disavowed that procedure and recommended that the Commission continue in its traditional course and view the Pioneer situation as a unique circumstance. Commission members noted their further concerns: • The Commission had advertised and received information twice regarding the available funds; yet for Council, new information was garnered and a consensus reached that was not available for the Commission. • Commission members question their role in the process if Council appears give equal or greater consideration to lobbying by agencies. • Allowing agencies to develop new information and perform an end -run at the time of the Council meeting undermines the CDBG process. • Commission members question whether Council perceives the amount of testimony and information that the Commission reviews. • The Commission does appreciate collaborative efforts that are presented. • The HOME program is very effective and should not be diverted. Mr. McCluskey responded further: The Pioneer allotment was a unique CDBG recommendation in its lack of a conclusive recipient. The discussion has evolved in an unusual manner. Not having a specific recipient magnified the lobbying efforts to Council. This unique circumstance should not affect the usual way in which the Commission reaches its recommendations. CDBG Commission Minutes February 8, 1996 Page 3 Council is discussing making work sessions more meaningful in order to grasp more fully the information that the Commission analyzes and the process involved in its recommendations. There was little doubt that the Pioneer item would be sent back to the Commission. Production is still a top goal, but the Commission's participation is needed in working through all the options now available for this unique issue. The Commission should continue to question the effectiveness of the process and seek Council answers and guidance. The Commission discussed the circumstances that led to the Commission members' inability to attend the work session organized by Mr. Fischbach. Mr. MacArthur noted the Commission's desire to be a part of the solution and asked that Council keep the Commission advised as to goals and expectations. Mr. McCluskey thanked the Commission for its diligence and withdrew from the meeting. COMMISSION ACTION REGARDING PIONEER MOBILE HOME PARK SET -ASIDE FUND Background presented by Mr. Waido: The Commission advertised twice for proposals and received three proposals: $235,000 for the Housing Authority, to build 33 owner -occupied units; $35,000 from TRAC to pay for development fees for 11 owner -occupied townhomes on JFK Parkway; and $200,000 from Neighbor to Neighbor for counseling, trailer rehabilitation, and trailer relocation. Action by the Commission: $150,000 to the Housing Authority, to accomplish 20 units; and $85,000 to Neighbor to Neighbor for trailer rehabilitation. Faced with new and confusing information, the Council tabled the matter pending further discussion among the parties. In the ensuing discussion, Rusty Collins of Neighbor to Neighbor spoke of the problems created with rehabilitation -only funds. It was noted that more owner -occupied units were being built than needed for the demand. Based upon information presented at that meeting, Ms. Stephens withdrew the Housing Authority's request. The parties at the meeting developed the following proposal: $185,000 for Neighbor to Neighbor for relocation costs; $15,000 to Neighbor to Neighbor for counseling, with a matching grant from the developer; and $35,000 for TRAC for the JFK Parkway development fees. In addition, JD&M offered $750 per unit and Habitat for Humanity raised $46,000 in support of the relocation effort. The Commission is now faced with evaluating recommendations in light of this new information. It may stand with its original recommendation or structure a new one. The applicants, staff, and others were present should their input be desired. CDBG Commission Minutes February 8, 1996 Page 4 Discussion generated by the Commission: Faced with an opinion by HUD that CDBG rehabilitation funds would trigger application of the Uniform Relocation Act, staff presented HUD with applicable sections of the Code. HUD conceded. As a result, funds may be used for rehabilitation. However, at Pioneer, 162 different trailers present the same number of rehabilitationlrelocation problems. Several funds exist for these problems. CDBG funds would not be used to pay residents directly but rather to pay or reimburse for expenses. The Pioneer homeowner association representative was unable to attend the meeting on January 23. Beth Music of Neighbor to Neighbor, who has counseled approximately 80 resident families, helped to represent the residents' needs. Relocation to home ownership projects, based on $70,000 purchase prices, was not seen as a viable option. All the principals at the January 23 meeting were available for the Commission meeting. Mr. Robin reported on a meeting the City held with the Pioneer association. The meeting was attended by: Mr. Robin; Liz Nira, of Pioneer; Pastor Wright, for Habitat; and Jackie Davis, for the Commission. Residents favored the following options: Move existing trailers The City would: sell land to residents at below -market prices; present alternatives for interim housing; and develop the land into a mobile home park. Acquiring trailers Units would be purchased to move to the Dry Creek development. Payment for the units was not discussed. Loans Low -interest and nonqualifying loans would be made available to the residents to develop a new mobile home park. There are still 120 to 149 households in Pioneer. Apparently, all residents are members of the Pioneer association. The priorities were gathered by door-to-door survey. Marcos Nira of Pioneer spoke of the door-to-door survey. He stated the following: He surveyed residents morning, afternoon, and night. Residents don't have much money and paid cash for their possessions. They cannot afford new locations without help. The residents do not want charity, but they cannot buy something they cannot afford. 100 percent of the residents were surveyed for the list of priorities. The Commission decided to accept presentations of interested parties, each to be followed by a question -and -answer session. Presentations of interested parties: Presentation by Pioneer residents. Liz Nira presenting. Neighbor to Neighbor needs the relocation funds. $750 per family is insufficient to move the residents. Some residents need new residences; others need their residences moved. The Pioneer association supports the Neighbor to Neighbor/TRAC presentation if it presents the best way to update housing or obtain new housing. Eight out of the 160 CDBG Commission Minutes February 8, 1996 Page 5 homes can be relocated in their existing condition. The residents would prefer that the funds be used to obtain new, used, or rehabilitated mobile homes for the residents. Presentation by Fort Collins Housing Authority. Shelley Stephens presenting. The initial proposal was $235,000 for 33 units. The Commission recommended $150,000; that rendered 20 units available for a homeowner with a $22,000 annual income to have a $550/month payment. The January 23 meeting resulted in a consensus to help all the residents with relocation. The Authority has already helped seven families with rental assistance and has placed one family in home ownership. The property is still available to the Authority and will be pursued for a future affordable housing development. State money may be available to help with the purchase. The Authority has developed a connection with Fannie Mae. The Authority is withdrawing its present application so that the greatest number of people may be helped with the available funds. One space for a mobile home is presently available in the city. Other residents can be housed as soon as the Housing Authority has availability. However, many residents are resistant due to the no -pet policy. Rentals are available in the community but are not in the fair market range for Section 8 rentals. Five to ten units a month - possibly 30 by September - become available through the Authority. With no available spaces in other mobile home parks, moving trailers is not an option at present. In Fort Collins, the cost of a new mobile home is approximately $25,000. The cost of moving a unit within town would be $750-780. Ms. Nira noted that units may be available for less when purchased in quantity. Presentation by TRAC. Larry Dunn presenting. TRAC can build 12 units instead of 11 on the SID property. If TRAC received the $35,000, it would finish garages on the property first so that residents could store their belongings and obtain interim housing until the units were available. The $35,000 is needed for development fees to bring housing availability down to the 30 percent median income level. Neighbor to Neighbor can verify that there are Pioneer residents interested in the TRAC program for $300-500 mortgage payments. TRAC residents would pay no more than 30 percent of their gross income for mortgage. The prospect of having buildings up by September is chancy and will occur only if no appeals are encountered in the planning and zoning process. Purchase price would be $35,000- 50,000 per unit. All units are earmarked for Pioneer residents. Presentation by Neighbor to Neighbor. Rusty Collins, Jeff Wright, and Beth Music presenting. Prospects are grim, even with the best -case scenario. 150 families need homes. TRAC may develop 12; CARE has allocated 15; the Housing Authority may help 30; Dry Creek may accept up to 12 units. Approximately 80 families remain from that equation. 20 to 25 families could still remain by September. The Fort Collins housing market probably cannot absorb these people. They will need help with relocation. The Donaldson money could be available for rental situations. CDBG money could be used for moving costs. CDBG Commission Minutes February 8, 1996 Page 6 The January Council decision may have stemmed from the realization that Pioneer is in a crisis situation. There may well be 50 or 60 families still in the park in September. The residents of Pioneer have a great deal of anger, denial, and mistrust. Confusion is rampant over the possibilities. They will need to have the options presented to them and then make their choices. Mortgages will be lost on homes that are not movable. Since there are no new locations for trailers, the Pioneer trailers probably have negligible resale value. The residents may well have to surrender titles to their trailers and then, using the available funds for moving expenses, locate elsewhere. Checks would be issued to a third party for the moving expenses. Neighbor to Neighbor is striving to have $1500 per family available. No spaces are currently available in Fort Collins for trailers. Cloverleaf is adding spaces, but they will be available for newer double -wide trailers and too expensive for Pioneer residents. Eight Pioneer trailers can be moved in their present condition. Perhaps 75 percent of Pioneer residents are at 50 percent or less median income; very few rental units are available in Fort Collins for that level. For a Pioneer resident to find a unit, pay moving expenses, make the first and last months' rent, security deposit, and maintain rent payments is problematic. It may be preferable to build units for Pioneer residents, but that will not address the large number of people who will not be able to obtain those units. The Donaldson money is available for families who vacate the park; it is not available to those who are evicted for nonpayment or breaking park rules. The housing market cannot absorb the number of residents who will be leaving. The relocation funds will, to a large extent, be used in helping people find residences in other areas. The only other option for many Pioneer residents is homelessness. The number of jobs lost due to Pioneer residents leaving the area is unknown. Neighbor to Neighbor received $30,000 for housing counseling in the last funding cycle. That represented a decrease of $9,000 from the prior year. 4,000 people per year are receiving counseling. Ms. Music has had to devote her efforts full -tune to the Pioneer situation. Neighbor to Neighbor also received a matching grant of $15,000. The $30,000 received in CDBG and matching funds do not pay for the counselor and translator needed to work with the Spanish-speaking families in counseling. The $85,000 rehabilitation money originally requested would only help with five to ten trailers, and the requirements are oppressive. The desired permanent solution of housing stock is not an option at this point for Pioneer residents. It is not possible to move Pioneer trailers to a new park in the CDBG Commission Minutes February 8, 1996 Page 7 area. $1500 would not cover costs for money of the residents to rent, even though many are willing to take on rent at 50 percent of their income. If the proposal were accepted, Neighbor to Neighbor would have $185,000 from CDBG; $150,000 from Donaldson; and $56,000 from Interfaith Council. If the proposal were not adopted by CDBG, Neighbor to Neighbor would be pursuing further fundraising, although the results would likely be unsatisfactory. In the unlikely event that unspent CDBG funds remained, they would be reprogrammed to CDBG. Each family will have to work to see its individual needs met as well as possible. Mr. Donaldson noted that the property is going through the development process now, and no further postponement is possible. Although no commercial tenants have been signed, the parcel will need to go through the applicable process in order to be available to tenants. If Pioneer residents stopped paying rent, they would face eviction within 30 days and loss of the $750 relocation funds from Donaldson. In regard to Dry Creek, Mr. Parsons stated that if nonprofit agencies are used for development, the land rental would be approximately $275 per trailer space. Presentation by Pioneer residents: Yolanda Nicely stated that she has been a Pioneer board member since the inception of the issue. Counselors have talked with Pioneer residents. However, if their proposals are enacted, the remaining residents are being told to leave town, with no job, and take their chances elsewhere. These residents have nowhere to move. They cannot afford to move. Their prime purpose for owning a mobile home is to keep from sinking into debt. They cannot afford new homes. The survival of the residents is at stake. It would be minimal cost to provide a piece of land to install new mobile homes, rehabilitated Pioneer homes, or Pioneer homes as -is. It would take 90 days from breaking ground on a new trailer park to completion. This is the only true option to allowing residents to continue to work, maintain their address, vote, participate in the public process, and thus continue their citizenry. The prime option is to build a new park. There is available land and ongoing land acquisition with the new open -space tax. The residents' needs are to acquire mobile homes, new or used. The City could find and purchase 149 '79 or older trailers, for $2,000-4,000, to be placed into the 168-space new mobile home park. The residents are fighting for their lives. They cannot afford $800/month rent, $750 for first and last months' deposit, and a damage deposit. The residents are being told to throw their hard-eamed money out the window that they have used to purchase their homes. CDBG Commission Minutes February 8, 1996 Page 8 Marcos Nira stated that any apartment in town will cost $750 in rent and $750 in a damage deposit. That is too much for the residents. They own their trailers. They. are being told to relocate; they didn't ask to be moved. Mr. Nira pays his bills. Everyone has to pay a damage deposit for an apartment. Mr. Nira stated that he was tired of people saying that the money to be apportioned was too much. The residents don't think it's too much. The residents help out other people as being part of the community, but that fact is being ignored. People are looking at dollar signs. Damage deposits that are paid for rentals will not be refunded. The residents need help in this situation. In response to questions by the Commission, Mr. Nira stated that he supported $1500, or more if necessary, per family for relocation. The Commission needs to think about where the money is going and view the issue from the perspective of the residents. Mike Nicely stated that the Commission exists for putting housing on the ground. He disagrees with some of the ways that the Pioneer board is addressing the issue. If 20 percent of the park is helped, that is a benefit. The residents of Pioneer will be leaving regardless of any decision by the Commission. The problems of Pioneer are the problems of the residents, not the Commission. The residents are undergoing this issue through no fault of their own. Likewise, the City and Donaldson are not at fault for following their own roles. The problem is being blown out of proportion, but the residents of Pioneer are survivors, and they will find a way to survive; but probably not in Fort Collins. Mr. Nicely urged the Commission to pursue its basic goals. Elizabeth Nira thanked Neighbor to Neighbor for its help to the residents but stated that not many residents have actually been helped. There will be places to put trailers, whether in Cloverleaf or Dry Creek. If those properties are later approved for trailer lots, the Pioneer residents will have been denied that opportunity. Pioneer residents who do wish to move can be benefited through funding of Neighbor to Neighbor. A hard choice exists for people who want to stay in Fort Collins and could use funds for a new mobile home, or people who will relocate elsewhere. If the residents are forced into the Fort Collins housing market, they will have no place to live and be a burden on the City through the social services agencies. If pressed for a choice, Ms. Nira would choose the option of having a mobile home in a different location. A five-minute recess was taken upon conclusion of the presentations. CDBG Commission Minutes February 8, 1996 Page 9 Discussion by the Commission: Moved by Mr. Steffes, seconded by Ms. Coxen: To discuss the issue, with motions held in abeyance until discussion is exhausted. Discussion was held. Motion passed 5-4. The following discussion ensued: The situation is no -win. The consensus meeting arrived at a means to allow people to relocate and survive. Finding housing in Fort Collins would be preferable to funding people $1500 to leave town. There are no relocation opportunities in Fort Collins. The proposed action sends a message to leave Fort Collins. Urban blight is not solved by packing people off to other towns. The Housing Authority has withdrawn its application. No other options seem to exist. The initial decision of the Commission was a good one; perhaps the Housing Authority withdrawal can be rejected. Ms. Stephens noted that the Housing Authority withdrawal was done out of the consensus meeting, feeling that it was in the best interests of the resident population as a whole. The community has a rare opportunity, based upon current interest rates, to encourage home ownership. Rental costs and home ownership costs are equivalent. However, Pioneer residents generally do not have the funds for a down payment and would be marginal, qualifiers for mortgages. They will have problems renting for the same reason. Affordable housing will best be addressed by putting units on the ground. The Housing Authority would anticipate a tight schedule for having units available by September 1. At the time of the decision for the set -aside, the intent was to put housing stock on the street, although the Commission did not specifically know where the money would be spent. If the intent was to do whatever is necessary to help the Pioneer residents, the Neighbor to Neighbor proposal may be the best choice. There is a $26,000 contingency. Respite Care could have overruns. Regardless of what the Commission decides, the political reality is that Neighbor to Neighbor will probably receive the funding. Without the option of housing stock, Neighbor to Neighbor may have the viable proposal. However, using those funds for relocation does not assist the affordable housing problem in Fort Collins and, indeed, dooms most Pioneer residents to leaving the city. "Consensus" is not an appropriate description for the meeting on January 23. There seems no real consensus for all parties. Pioneer residents and the Commission were not present at the meeting. Any vote taken by the Commission should be on the judgment of its members and not by surrendering to some perceived political reality. The Commission decision should be apolitical. The original set -aside decision may have been a bad idea in that it diverted funds from projects that would have permanently helped Pioneer residents. CDBG Commission Minutes February 8, 1996 Page 10 The problems facing the Pioneer residents will likely lead to personal difficulties among them. It will not be possible to help 100 percent of the Pioneer residents; but helping 20 to 30 percent with permanent affordable stock would be a worthy effort. New units will probably not be ready by September 1. Although the Commission may be apolitical in theory, in fact it is in the middle of a volatile political issue. The decision .being made in January or February precludes options that may have otherwise been viable, in that no time remains for construction. HOME money should not be used to subsidize this effort. The HOME down payment program has been highly effective and should not be diverted from the opportunities it raises for home ownership. The present interest rates offer a window of opportunity for building affordable housing units. The likelihood of using CDBG to send people away is offensive. If this lack of options had been foreseeable, CDBG money may not have been set aside for this effort. Moved by Mr. Hartmann, seconded by Ms. Coxen: To resubmit the Commission's original recommendation. Discussion was held that this motion constituted deferring the decision to City Council. Mr. Collins stated that should the original recommendation be approved, Neighbor to Neighbor would withdraw from the rehabilitation program as not being viable. Upon discussion, Mr. Hartmann amended his motion to divert the $85,000 rehabilitation funds to relocation. Ms. Coxen assented. The following discussion ensued: Ms. Stephens indicated that the Housing Authority would move forward with its project if so funded. When pressed, she estimated an 80 percent chance of completing the project by September 1, due to the nature of the modular construction. The Authority has preliminary PUD approval for the project. In response to questioning, Ms. Smith stated that the $75,000 in HOME funds have been allocated. Five families from Pioneer are being assisted. Calculations by Commission members showed that with the recommendation as amended, when combined with the Donaldson funds and private contributions, approximately $1500 would be available per family for relocation funds. The details of the motion were stated as: $150,000 to the Housing Authority for 20 units; $85,000 to Neighbor to Neighbor for relocation efforts. A statement was advanced that the motion struck a balance between placing units on the ground and assisting with relocation. TRAC would, in all likelihood, be able to proceed with their project. Mr. Dunn responded that the lack of $35,000 in development fees would slow the project to miss the September 1 deadline for aiding the Pioneer residents. CDBG Commission Minutes February 8, 1996 Page 11 Because of the unique partnership brought together by the Pioneer issue and the agreement reached through consensus of that partnership, and the support voiced by Mr. McCloskey, the agencies' consensus for relocation may well represent the best use of the available funds. It is questionable whether enough Pioneer residents would qualify for the 20 Housing Authority units. The $35,000 funding for TRAC would be desirable. If apportioned from the 1996 CDBG grant, the money would not be available until after September. The Commission cannot grant funds on a reimbursement basis. Concern was expressed that unless funds were used for permanent housing, this situation could happen repeatedly, with CDBG moneys continually funneled out of the community for relocation. Motion withdrawn by Mr. Hartmann. Ms. Coxen assented. FINAL ACTION BY THE COMMISSION Moved by Ms. Coxen, seconded by Mr. Ostic: To fund $35,000 to TRAC; $50,000 to Neighbor to Neighbor for relocation; $150,000 to the Housing Authority; and $15,000 apportioned from the contingency fund for Neighbor to Neighbor. Discussion was held on the mechanics of administration funding and contingency application. Comments were made that the motion presented a balance between the goals inherent in the set -aside fund. Questions were advanced whether the motion applied well to the unique Pioneer situation. Ms. Stephens inquired about funding for the Dry Creek property. The Commission noted that absent an application, no action could be approved. The Commission is designed to encourage and respond to applications rather than initiating projects on its own. If some Pioneer residents avail themselves of the opportunities presented by TRAC and the Housing Authority, it will reduce the pool of people in need of relocation funds and, therefore, increase the relocation funds available to each remaining family. Comments were made that the consensus meeting had value in that it furthered dialogue and the information available to the Commission. Motion passed 9-1, with one abstention. OTHER BUSINESS: Concerning the TRAC Parkway townhomes, Ms. Smith stated that the Planning Department is encouraging resolution of this project. It will be evaluated within all applicable criteria. The application is for $190,000; $115,000 is available through HOME funds. TRAC understands the limitations. CDBG Commission Minutes February 8, 1996 Page 12 Moved by Mr. Steffes, seconded by Ms. Sample: To allocate $115,000 for the TRAC Parkway project. Compliments were forwarded to Ms. Smith for her diligent work and timely delivery. Motion passed unanimously. The meeting adjourned at 9:25 p.m.