02-12-01 Community & Economic Development

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ommitf ort: =ommuntti anb tomtit airttioputtnt committer The February 12, 2001 meeting of the Community and Economic Development Committee was called to order by its Chairperson, Council Member Roland Kelly at 4:05 p.m. in the Council Informal Meeting Room. Persons in attendance included Council Members: Aranowski, Pfeifer, King, Kelly, Varner, Ujdak, Coleman and Kirsits; Mayor Stephen J. Luecke, Citizen Member Isabelle Gonzalez, Building Commissioner Don Fozo, Public Works Director Gary Gilot, Community and Economic Development Director Jon Hunt, Fire Chief Luther Taylor, Code Enforcement Director Kathy Davis, City Attorney Charles Leone, Assistant City Attorney Ann-Carol Nash, Historic Preservation Commission Acting Director John Oxian, Planning & Neighborhood Development Assistant Director Larry Magliozzi, Economic Development Specialist Cassandra Moran, Economic Development Specialist Michael Beitzinger, E. Stanley Foster, Terry O'Brien, Terry Bland of the touts end tribunt,and Kathleen Cekanski-Farrand, Council Attorney. Council Member Kelly noted that the first item on the agenda was to continue discussion on Bill No. 01-7 which is a five (5) year residential real property tax abatement request for Madco Residential, LP 2 which was continued from the last Council meeting. Cassandra Moran summarized the January 17, 2001 Tax Abatement Report (copy attached) which notes that petitioner proposes to construct seventy (70) 1,568 square foot, three-bedroom rental units which would be individual homes. The total project area is 12.35 acres for a total projected project cost of$ 6,000,000.00. The individual home cost would be approximately$ 85,000.00 Michael Beitzinger noted that several questions were raised by the Council Members at the last Committee meeting. With regard to the type of construction, he noted that the Council has a long history of approving"stick-built"homes. The petitioner proposes factory built modular homes. In light of this, Mr. Beitzinger invited Don Fozo, the Building Commissioner, to provide additional information. Don Fozo noted that in 1981 a state law was passed which prohibits the discrimination against manufactured housing. HUD does all the inspections to their own codes. They typically average 950 square feet. Modular homes have always been allowed within the city limits. They are built pursuant to the standards set forth in Public Law#360 which is the One and Two Family Dwelling Code. Consequently the regulations are the same as"stick-built"homes. Mr. E. Stanley Foster, President and General Partner for Madco Residential LP 2 then made a presentation. He showed pictures of several homes which were all modular in style. He noted that all construction would be properly inspected. The basic issue before the Council is the fact that the homes would be lease or rental units for the first fifteen (15) years pursuant to IRS regulations, as opposed to being owner occupied initially. He has been advised by the Department of Community and Economic Development that there are no local or state prohibitions against lease/rentals. He noted that he is focusing on providing affordable housing and hopes to qualify for tax credits which are based on a point basis. The IRS regulations require the units to be rentals for the first fifteen (15) years. The project will be approximately $ 6.2 million with $ 1.2 million of that amount being borrowed. Both five-year and thirty-year notes will be involved. The City's contribution would be the tax abatement designation which will provide him with additional points under the IRS tax credit system. Mr. Foster concluded that without the tax abatement,he could not