Loading...
06-11-2019 CCM Workshop (Joint HRA Board)HUTCHINSON CITY COUNCIL SPECIAL WORKSHOP MEETING MINUTES TUESDAY, JUNE 11, 2019, AT 4:00 PM CITY CENTER — COUNCIL CHAMBERS Call to Order Mayor Forcier called the meeting to order at 4:00 p.m. Members present were Chad Czmowski, Mary Christensen, Steve Cook and Dave Sebesta. Others present were Matt Jaunich, City Administrator, Jean Ward, HRA Executive Director and Judy Flemming, HRA Program Coordinator. DISCUSSION/REVIEW ITEMS 1. Joint Meeting with Hutchinson Housing and Redevelopment Authority Board Introductions were made of HRA Board Members and City Council Members. Jean Ward, HRA Director, presented before the group. Ms. Ward explained that the HRA's intention is to provide information on housing and affordable housing in the City of Hutchinson. Ms. Ward provided data on general occupancy vacancy rates, home resales, residential lot availability, new dwelling units construction and foreclosures. Ms. Ward reviewed highlights for 2018 which include the opening of a second building in Highfield Apartments, HRA submitting SCDP preliminary proposal to DEED for the rehab of 40 apartments at South Dale Apartments, assisting eight owner -occupied properties with rehab funding and Park Towers Apartments again achieving HUD high performer status in 2018. Also over $200,000 was invested in exterior caulking and new appliances. The 2019 rental development plans for general occupancy include the third and final 29 unit building of Highfield Apartments is scheduled to open August 1, 2019; an additional 135 units is scheduled to open spring to summer of 2020; Century Court Apartments has an approved site plan of 84 units and is currently permitted to build three buildings of 12 units each. The 2019 rental development plans for senior housing include Woodstone planning an expansion of 38 units of senior independent living and Prince of Peach is considering an expansion of 10-12 units of senior housing. Priorities for 2019 including submitting a full SCDP rehab application for South Dale Apartments for a total project cost of $789,286; assisting five first time homebuyers with affordability gap to purchase newly constructed starter homes — current cost estimate of a starter home is $225,000; obtaining a Capital Needs Assessment for Park Towers Apartments and evaluate feasibility of repositioning from Public Housing to Project Based Rental Assistance; and continuing owner occupied rehab programs throughout the City. Ms. Ward noted that realtors predict for 2019 that the housing market for 2019 will be good but maybe not as robust as 2018; new housing construction will continue to grow; the median resale price will continue to rise but maybe not as much as 2018. Ms. Ward then presented on a Rental Assistance Demonstration (RAD) Program. Ms. Ward noted that the HRA owns and manages Park Towers Apartments which is a 101-unit hi -rise. Park Towers is federally funded through the public housing program that provides operating subsidy and capital funding with tenant rents at 30% of monthly adjusted income or a flat rent of $580 for a one bedroom apartment. Ms. Ward explained that RAD is a HUD program that will allow the PHA to convert properties from conventional public housing with traditional capital fund subsidies and operating fund subsidies to project -based Section 8 with a housing assistance payment contract. Ms. Ward further explained PHA funding which are federal funds with an amount determined by a HUD formula. Ms. Ward explained the HRA's capital fund program grants and public housing operating subsidy information. Ms. Ward reviewed the Housing Assistance Payments which mean when housing units are converted to RAD, the HAP is the payment made by HUD to the PHA as agreed upon in the HAP contract; the HAP contract lasts for 15-20 years therefore stabilizing PHA funding and securing inflation adjustments vis contract; at the end of the HAP contract HUD invites the PHA to renew the HAP and the PHA must accept that invitation. RAD will provide a stable and predictable project subsidy from HUD. RAD could also allow the PHA to more easily seek other financing tools to renovate public housing. RAD creates greater funding certainty while allowing increased operational flexibility for the PHA. With the RAD program it locks in the current level of project subsidies in a Section 8 "Housing Assistance Payments" contract with built-in annual increases that would address inflation; the units are managed and operated under the Section 8 regulations; and it replaces HUD "Deed of Trust" with a RAD "Use Agreement" so the PHA can borrow against the property to fund renovations. Ms. Ward reviewed the steps required for a RAD conversion. Judy Flemming, Program Coordinator, presented before the group. Ms. Flemming provided 2019 project updates. A major project for the year is the SCDP rental rehab for South Dale Apartments. The estimated total project cost is $789,285.71. Ms. Ward reviewed an employer survey that went out in May 2018 to manufacturing companies. 17 companies responded. Uponor said they feel they will be filling job openings with area workers and there will be no new housing needs. 3M submitted the employer survey after the workforce housing task force meeting and indicated that only rental housing will be needed. Ms. Ward provided data on affordability rates for homebuyers. The information showed that a household income of $55,000 can have a maximum mortgage of S173,234.81. Ms. Ward also provided data on affordability rates for rental properties. Ms. Ward provided an update on work done since the Maxfield Rental Housing Study was completed in 2012. Ms. Flemming provided an update on homeowner rehab project updates from 2018. Projects were done on homes on Golf Course Road NW, 5"' Avenue NW, McDonald Drive SW, Monroe Street SE and Maryland Street NW. Projects for 2019 include homes on Hassan Street SE, Jefferson Street SE, Southview Drive SW, Second Avenue SW, Sherwood Street SE and 1525 McDonal Drive SW. These projects are a mix of Live and Work, deferred grant program, grant program and mobile home initiatives. Items for the Council to consider include housing needs, when to complete the next update of the Maxfield Housing Study and review housing development tools. Motion by Christensen, second by Sebesta, to adjourn at 5:25 p.m. Motion carried unanimously. ATTEST: Gary T. Forcier Mayor Matthew Jaunich City Administrator