HomeMy WebLinkAbout06-26-17 Personnel and Finance O�SOU T11
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OFFICE OF THE CITY CLERK
KAREEMAH FOWLER,CITY CLERK
PERSONNEL&FINANCE JUNE 26, 2017 4:37 P.M.
Committee Members Present: Karen White, Regina Williams-Preston, John Voorde
Committee Members Absent: Gavin Ferlic
Other Council Present: Tim Scott, Oliver Davis, Jo M. Broden
Other Council Absent: Dr. David Varner, Randy Kelly
Others Present: Kareemah Fowler, Graham Sparks, Bob Palmer, Aladean
DeRose
Presenters: Pam Meyer, Tyler Kalachnik, Rob Budman, John Murphy,
James Mueller, Aaron Perri, Eric Horvath, Steve Cox
Agenda: Bill No. 17-36- Miami Hills Bond Approval
Bill No. 36-17- June Transfer Ordinance
Bill No. 37-17- June Civil City Ordinance
Bill No. 38-17-June Enterprise Funds Ordinance
Committee Chair Karen White called to order the Personnel and Finance Committee meeting at
4:37 p.m. She introduced members of the committee and proceeded to give the floor to the
presenters for the first item on the agenda.
Bill No. 17-36-Miami Hills Bond Approval
Pam Meyer, Department of Community Investment with offices on the 141'floor of the County-
City Building, stated, I'm introducing this topic. We will have with us tonight, via Skype,the
owner of the Miami Hills Complex,Robert Budman. He will do a presentation via PowerPoint
(which is available in the City Clerk's Office) and there are also attorneys here from Ice Miller.
This is basically a request from the owner of Miami Hills for a tax credit application through the
state,which is a non-competitive tax credit application, and they wish to invest and rehabilitate
the entire complex.
455 County-City Building•227 W.Jefferson Boulevard•South Bend,Indiana 46601
Phone 574-235-9221 •Fax 574-235-9173•TDD 574-235-5567•www.SouthBendfN.gov
JENNIFER M.COFFMAN ALKEYNA M.ALDRIDGE JOSEPH MOLNAR
CHIEF DEPUTY/DIRECTOR OF DEPUTY/DIRECTOR OF POLICY ORDINANCE VIOLATION CLERK
OPERATIONS
Tyler Kalachnik, 1 American Square, Indianapolis, Indiana, stated, I am with Ice Miller and we
are serving as Bond Council for the project. We came before the Economic Development
Commission earlier this month on June 5th. We are seeking a tax-exempt bond through the City,
not to exceed$14 million for the rehabilitation of certain improvements. The statutory process
requires us to seek an inducement, which is federal tax procedure. This is so that when the bonds
get issued, those proceeds could be used to reimburse costs that have already occurred up to sixty
(60) days prior to when the resolution is adopted. The bonds themselves would not have a
constitutional debt effect on the City. They are not payable from taxes, they are solely
obligations payable from revenues of the project. With these low-income housing tax credit
bonds, fifty percent(50%) of the basis of the project must be funded with tax-exempt debt in
order to qualify. The inducement resolution is also a prerequisite for submitting the application
to the State Housing Authority. The Economic Development Commission made findings that
there are no adverse competitive effects given that this is an operating project. It is currently one
hundred percent(100%) affordable section eight(8)housing and it will remain that way after
these improvements. The Area Plan Commission sent a letter and had no comments or issues
with the zoning.
Robert Budman, Principal of Boulevard Capital LLC, stated, We are the owner of Miami Hills
Apartments. Tyler mentioned the structure of the advancing of renovation of the current property
and, as part of those plans, we are requesting the tax-exempt private activity bonds. Mr. Budman
then highlighted key aspects of the project going over a PowerPoint which is available in the
City Clerk's Office. He gave a brief history of Boulevard Capital LLC and provided information
on other properties they own.
Mr. Budman continued, This is a one hundred and fifty-one (15 1) unit community that was built
in 1975. It serves mainly families with a mix of one (1), two (2),three (3) and four(4)bedroom
units. There is over a one hundred (100) family waitlist for units on the property. Boulevard
Capital LLC purchased the property back in July of 2014. At that time,the property was quite
distressed and was in need of major renovation turn-around which we have been undertaking for
the last few years. We have now gotten a good management company on site and have been able
to get things under control. To date, Boulevard Capital LLC has spent $300,000 in capital
improvements at the property. We have also implemented regular and ongoing security routes in
partnership with the Police Department to prevent any crime.
Mr. Budman then overviewed some of the challenges and opportunities the future exterior and
interior comprehensive plans will face. He also gave brief explanation to the timeline of the
bond-approval process. He finished his presentation by explaining the benefit for the Miami Hills
community and the community of South Bend.
Committee Chair White opened the floor to questions from the Committee or Council members.
Committeemember Regina Williams-Preston asked, What is the general cost of rent in the
apartments now and what change might happen after the renovation?
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Mr. Budman replied, The rent the residents pay will not change. Residents pay thirty percent
(30%) of their income and that is just how section eight(8) rent is structured. The base rent that
we pay will probably go up ten percent(10%), but that will not affect the residents.
Committeemember Williams-Preston followed up, Are there any assurances that this renovation
work will be done with minority contractors?
Mr. Budman replied, We are looking to work with the best contractors that can provide the best
products at the best price. We would obviously be open to minority contractors but at the end of
the day, our first goal is to provide the best possible product to the residents of the property. We
are going to competitively bid out these contracts and there are minority contractors that bid,but
there are no assurances at this point. Right now, we are really just looking for the best product.
Councilmember Oliver Davis asked, When the units are being renovated, where will the
residents go? Will they remain in the complex?And how long will they be relocated?
Mr. Budman replied, Our first choice, which is the most likely choice, is we will relocate them
temporarily to other units on the property. The natural attrition of the property,units will vacate
and as they do, we will relocate them to that unit, renovate their unit, and move them back to
their renovated unit. The renovations are expected to take about two (2)weeks for individual
units, so they will only be out of their unit for about two (2)weeks.
Committeemember Jo M. Broden asked, What is the current occupancy?
Mr. Budman replied, Occupancy is roughly one hundred percent(100%)with one hundred and
fifty one (15 1)units.
Committeemember Broden followed up, And when was the last time any renovation has taken
place at this property? And how is your relationship with the current management company?
Mr. Budman replied, There has been no substantial renovation at this property,that we are aware
of, since its initial construction. The management company is a third-party management
company. We hired them to manage the day-to-day operations of the property.
Committee Chair White then opened the floor to members of the public wishing to speak in favor
of or in opposition to the legislation. There were none. Committee Chair White then turned the
floor back to the Committee for further comments or main motions.
Council President Tim Scott stated, This came before the Economic Development Commission
and it was passed unanimously. Mrs. Lee is here and she is representing the property
management company. I truly believe this is the only economic way that this property can get a
boost and the uplift that is needed. Previous management did not take care of this property,
therefore there were issues that weren't addressed. This is a needed property in our City and a
needed boost. There is no City money, it is their own bonding and funding and I think this is the
only way to make it a stable community within our City.
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Committeemember Williams-Preston made a motion to send Bill No. 17-36 to the full Council
with a favorable recommendation. This motion was seconded by Committeemember John
Voorde which carried unanimously by a voice vote of three (3) ayes.
Bill No. 36-17-June Transfer Ordinance
John Murphy, City Controller with offices on the 12th floor of the County-City Building stated,
We've done these before and we do them quarterly so we keep on top of things. This is a transfer
ordinance. This is just transferring accounts within a fund, it is sort of an accounting exercise.
For example, we are transferring three hundred dollars ($300) from a supply account to a repair
account. For the Building Department, we are transferring money to a temporary account
because they hired a temporary worker to work on the scanning of some documents. The last one
(1) is the Parks Bond Account, and we are keeping track of that very closely. These are all
transfers within the same fund,they are not additional appropriations at all.
Committee Chair White opened the floor to questions from the Committee of Council members.
Councilmember Broden asked, What is the information technology line item?
Mr. Murphy replied, That is for the EnFocus group. I am not sure which project it is but they do
a variety of different things for the City. There is a salary vacancy in that account so that is what
it is used for.
Councilmember Broden asked to receive specific information regarding what the project is by
the 7:00 p.m. Council meeting.
Committee Chair White then opened the floor to members of the public wishing to speak in favor
of or in opposition to the legislation. There were none. She then turned the floor back to the
Committee for further comments or main motions.
Committeemember Voorde made a motion to send Bill No. 36-17 to the full Council with a
favorable recommendation. Committeemember Williams-Preston seconded this motion which
carried by a voice vote of three (3) ayes.
Bill No. 37-17-June Civil City Ordinance
Mr. Murphy stated, This is the additional appropriation of the Civil City Funds, which are your
property tax and COIT type funds. We have some of our Department Heads here to answer any
questions you may have. Going down the list we have a$40,000 additional appropriation in the
Parks and Recreation Fund for water utility cost. We started charging all the City Venues in
2017. The second is a$200,000 appropriation for the repaving of Mayflower Road. It is in
conjunction with what St. Joseph County is doing and we are trying to do it at the same time.
The third is a housing market study done by our Department of Community Investment.Next,
we are using some interest from the Gift/Donation Fund for some conceptual design work. We
wanted to use the interest on the Donation Fund so it's not taxpayer money in any way, shape or
form. We are doing some public work projects, which is the Local Road and Street Fund. We've
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had a number of classes during the past couple of years and some of the boat motors have gotten
damaged and there is a decent amount of fund reserve in that account so we are only going to use
$28,000 for some repairs to the motors and boats. That is the Indiana River Rescue Fund. Next,
the Morris Performing Arts Center marquee sign is in need of some repair. That fund receives
one dollar($1)per ticket sale so there is no property tax or income tax money going into that
Fund at all. The last one is $1,000 for the Erskine Village to pay off the bond which happened
back in January, we just didn't have quite enough in the budget. It has already been paid off.
Committee Chair White opened the floor to questions from the Committee and Council
members.
Committeemember Williams-Preston asked, I would like to hear from the Department of
Community Investment about the $100,000 for the housing study.
James Mueller, Department of Community Investment with offices on the 14th floor of the
County-City Building, stated, When we put in the budget request over three (3) weeks ago, we
didn't have an estimate. So the $100,000 sounds like a round number and it is. We took the
downtown study which was one (1) area, and multiplied it by roughly seven(7)to eight(8)
impact areas. Since then, Councilmember Williams-Preston and the team have started to focus in
on where those impact areas will be. We have also been in contact with potential housing market
providers and it looks like the cost could come down to $40,000, but may be between that and
$70,000 when all is said and done. The charge for this originated when the need was expressed
for a comprehensive housing market study, looking at all housing types across the City. When
we started contacting consultants,they said it would be better to start focusing on areas. That is
what we have been working on is honing in on the areas.
Committeemember Williams-Preston asked, Have you decided on what company to use?
Mr. Mueller replied, We have a preference but haven't made any formal agreements. That
decision will not be made until the funds are appropriated.
Committeemember Williams-Preston followed up, My understanding was that if the cost to one
(1)particular company was going to be more than $25,000, you would have to do a request for
proposal. Can you clarify that?
Mr. Mueller replied, We can opt to do a request for proposal but that will slow down the process
with professional services because they are unique in what they are offering. They aren't seen as
a commoditized project like a road or sidewalk. The $25,000 limit is from the Board of Public
Works.
Committeemember Williams-Preston then asked, So you could spend up to the $100,000 on
which ever company you pick?And who makes the decision?
Mr. Mueller replied, That will go through the Board of Public Works. Usually the Department
will propose and go through the process,but it will end up before the Board of Public Works.
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Committeemember Williams-Preston asked, And what is the process like for that? We have no
requests for proposals so is it basically some people you know that have been recommended?
Mr. Mueller replied, We usually ask for quotes from a few places and proposals. We have talked
to Pam Meyer about those.
Committeemember Williams-Preston followed up, At the time we spoke, it seemed like you
were leaning toward and had made a decision on Volk.
Ms. Meyer replied, When I spoke with them, I didn't have a whole lot of details. When you
speak with people going through this process, you will not have your exact details until you are
closer to actually contracting with someone. I spoke about the one hundred (100)houses in five
hundred (500) days project, about the impact areas and numbers. The basic difference between
Volk and Mr. Murdock's firm is the fieldwork. Mr. Murdock would do more data analysis and
not as much fieldwork. Mr. Murdock has also never worked in South Bend before, but Volk has
worked in South Bend twice. Because of their connection to the neighborhoods that were
established in one (1) of their studies and the preliminary research already done, that makes Volk
a little bit more favorable.
Committeemember Williams-Preston stated, With that specific project, we are targeting a market
that is a majority of people that fill the gap between the poverty line and those with more means.
Volk has done work previously in South Bend with the downtown market study and we had a
chance to look at that. There were some concerns with their target market and methodology,
specifically that they were only targeting households with$50,000 incomes. I know some
families that were chosen make less than that so I have some concerns about how we are
choosing the markets. As we are investing taxpayer dollars into a market study, I think we need
to be very clear that whoever is doing the market study has the ability to connect with people
who live in those markets. It is something we haven't done well as a City in the past.
Mr. Mueller stated, We are happy to work with you to get language like that in the contract,
when we get to that point in the process.
Committee Chair White stated, I would recommend the Administration work closely with the
specific District Representative to make sure the concerns are addressed moving forward for a
positive outcome. She then encouraged the Councilmembers to submit concerns and suggestions,
in writing,to Mr. Mueller moving forward.
Councilmember Broden asked, How would this differ from other housing market studies that
have been done by the private market?
Mr. Mueller replied, The parameters are different and more broad. The `missing middle' is also
at the forefront, that is those in-between the single-family detached houses and the high-rise
apartments.
Committee Chair White then opened the floor to members of the public wishing to speak in favor
of or in opposition to the legislation.
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Jasmine Brown, 230 Sage St., stated, One (1) of my concerns is what happens to the
appropriations if they don't get used. Also, is there any money set aside for community members
that will invest a lot of time in this project? They may not be a part of the corporation doing the
study, but they will also be investing their time as well.
Will Smith, 728 Whitehall Dr., stated, My only issue with the study is the appropriation of the
money before we know what areas we will be studying.
Jordan Giger, 61455 Druid Ln., stated, What part of the money is set aside from the
appropriation for residents, non-profits and other members of the community that will be helping
with the study? How long will the firm be in the City and how many meetings will they have
with community members? At the last meeting, someone said the company would only be here
for about a week.
Mr. Murphy replied, If the appropriation isn't spent, it lapses and it is not spent at all. It then
stays in the checking account of the City.
Ms. Meyer replied, The firm would be in the City approximately four (4)to five (5)months.
Depending on how many meetings are wanted,that has not been written out and confirmed. At
the beginning of the process,yes,the contractor will be here for about a week to meet with
people they have to meet with. Could they come back multiple times? Sure,but those things have
not been discussed because we are not in a position yet to do that.
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Committee Chair White turned the floor back to the Committee for further comments or main
motions.
Councilmember Broden asked about the nature of the work at the Veterans Memorial and the
Ironwood pavement repair.
Aaron Perri, Director of Venues Parks &Arts, stated, We signed an agreement with Veterans
Memorial at the Park Board last August to improve the softball field out there. It will be the
Jiome field for IUSB so it is going to be used eighteen(18) days a year by them and the rest of
the year the public will be able to enjoy the improvements. It was paid for by a donor,but we did
the work so it is just a transfer of the monies donated.
Eric Horvath,Director of Public Works, stated, The repair will be just north of Licolnway by the
Walgreens. The concrete has buckled up and we have to replace all that pavement.
Committeemember Voorde asked, The quarter of a million dollars for the marquee, what do you
expect getting done there?
Mr. Perri replied, The marquee was renovated in 2005 but the video board squares are starting to
fail, and those aren't manufactured any longer. Before we lose several of them,rendering the
whole thing useless, we are going to upgrade all of the video interworkings.
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Committeemember Williams-Preston made a motion to send Bill No. 37-17 to the full Council
with a favorable recommendation. Committeemember Voorde seconded this motion which
carried unanimously by a voice vote of three (3) ayes.
Bill No. 38-17-June Enterprise Funds Ordinance
Mr. Murphy stated, These are the additional appropriations for the Enterprise Funds. They both
relate to the EMS Capital Fund. The second one (Mr. Murphy provided a handout to the
Committee and Council members which is available in the City Clerk's Office) is relating to the
Indiana Family and Social Services Administration. It worked last year and we are going to do it
again. Last year we paid the State of Indiana$385,775 and they sent us a check back for
$1,153,018. They have offered to do it again so we thought that would be an appropriate place to
make the payment. The first one relates to Fire Station Number Nine (9),the $200,000 is for the
architects, $100,000 for additional land purchases and $120,000 for the demolition of five (5)
properties that have already been purchased.
Committee Chair White opened the floor to questions from Committee or Council members.
Councilmember Davis asked, What is the timeframe for everything happening with Fire Station
No. nine (9)?Are the Fire Stations going to have a similar look or blend into the neighborhood?
Steve Cox, Chief of the South Bend Fire Department, stated, Our goal was to get this
appropriation and move forward with demolition in the fall. We anticipate the design work to
take about six (6)months and that will start now. In December or January, we will hopefully be
able to bid out construction for some time in the spring. We have not engaged anyone at all with
design process. We want the Fire Stations that are being built to blend into the neighborhood and
we have had many community meetings regarding that issue. There are solar panels on Fire
Station Number Four(4) of Fire Stations, as well as the new one (1)being LEAD Silver
certified.
Committee Chair White opened the floor to members of the public wishing to speak in favor of
or in opposition to the legislation.
Sue Kesim, 4022 Kennedy Dr., stated, I am glad to know Fire Station Number Nine (9) is LEAD
Silver certified and that Fire Station Number Four(4)has solar panels.
Committee Chair White turned the floor back to the Committee for further comments or main
motions. Committeemember Voorde made a motion to send Bill No. 38-17 to the full Council
with a favorable recommendation. Committeemember Williams-Preston seconded this motion
which carried unanimously by a voice vote of three (3) ayes.
With no other business, Committee Chair White adjourned the Personnel and Finance
Committee meeting at 5:37 p.m.
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Respectfully Submitted
Karen White, Committee Chair
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