HomeMy WebLinkAbout10-12-2026 Community Investment Committee Minutes
OFFICE OF THE CITY CLERK
BIANCA L. TIRADO, CITY CLERK
INTEGRITY | SERVICE | ACCESSIBILITY
Jasmine Jackson Matthew Neal Veronica Pitt-Payne
CHIEF DEPUTY CITY CLERK / CHIEF OF STAFF DEPUTY CITY CLERK / DIRECTOR OF POLICY DIRECTOR OF SPECIAL PROJECTS
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300 City Hall | 215 S. Dr. Martin Luther King Jr. Blvd. | South Bend, Indiana 46601 | p. 574.235.9221 | f. 574.235.9173 | www.southbendin.gov
COMMUNITY INVESTMENT OCTOBER 12, 2026, 4:00 P.M.
Committee Members Present: Sherry Bolden-Simpson* (arrived late),
Sheila Niezgodski, Kevin Upton, Tom
Gryp*, Ophelia Gooden-Rodgers, Karen L.
White
Committee Members Absent: None
Other Council Present: Dr. Heidi Beidinger, Canneth Lee
Others Present: Bianca L. Tirado, Jasmine Jackson,
Matthew Neal, Lari’onna Green, Veronica
Pitt-Payne, Bob Palmer
Presenters: Joe Molnar, Megan Schuetz, Jim Bennett
Agenda: Bill No. 69-26 - Authorizing a Direct Loan
to the Developer of an Economic
Development Facility (Heartwood
Commons Project) and Approving Other
Matters in Connection Therewith
(Substitute)
Members marked with an asterisk (*) are in virtual attendance via Microsoft Teams.
Please note the attached link for the meeting recording:
https://docs.southbendin.gov/WebLink/Browse.aspx?dbid=0&repo=sbend&mediaid=414796
Committee Chair Karen L. White called to order the Community Investment Committee meeting
at 4:00 P.M.
Bill No. 69-26 - Authorizing a Direct Loan to the Developer of an Economic Development
Facility (Heartwood Commons Project) and Approving Other Matters in Connection
Therewith (Substitute)
Committee Chair White entertained a motion to accept the substitute bill.
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300 City Hall | 215 S. Dr. Martin Luther King Jr. Blvd. | South Bend, Indiana 46601 | p. 574.235.9221 | f. 574.235.9173 | www.southbendin.gov
Committee Member Sheila Niezgodski moved to accept Substitute Bill No. 69-26, which was seconded by Committee Vice Chair Ophelia Gooden-Rodgers and carried by a vote of five (5)
ayes with one (1) Committee Member absent.
Committee Chair Karen L. White – Aye
Committee Vice Chair Ophelia Gooden-Rodgers – Aye
Committee Member Sheila Niezgodski – Aye Committee Member Sherry Bolden-Simpson – Absent
Citizen Member Tom Gryp – Aye Citizen Member Kevin Upton – Aye
Committee Chair White noted that she received questions about the bill from Committee Members. She said these questions have been shared with Council leadership and the Department
of Community Investment.
City Clerk Bianca Tirado acknowledged that Committee Member Sherry Bolden-Simpson joined the meeting and is now present online.
Joe Molnar, Deputy Director of Community Investment, with offices on the fifth (5th) floor of City Hall, South Bend, IN 46601, presented the bill. He said it pertains to the Heartwood
Commons project, which is being developed by KCG. He noted that Council approved a rezoning
and a tax abatement in support of this Low-Income Housing Tax Credit (LIHTC) project in 2025. He described the site as three (3) vacant parcels on the south side of town at the intersection of West Donald Street and South Main Street, a few blocks west of Riley High School. He noted that the parcels are currently owned by the Redevelopment Commission, which has entered a
purchase agreement with the developer. He spoke about the general need for more affordable
housing in the City, citing a two-hundred (200)-person waitlist at Diamond View, a similar LIHTC project. He said the City is also focused on filling vacant lots, which are a symptom of population decline and generate little to no tax revenue. He described the Heartwood Commons project as a sixteen-million dollar ($16,000,000) investment that would provide one-hundred-
twenty (120) temporary construction jobs paying thirty-four dollars ($34) per hour. He said
projects like this allow the City to capture state and federal dollars through programs such as LIHTC, but applications are not typically successful without a local match.
Joe Molnar spoke about the environmental history of the site. He said the City procured the property in 2012 for the demolition of an existing industrial building. He noted that the industrial
building had been there since the 1970s, and prior to its industrial use, there was housing and
small-scale commercial use on the site. He noted that the 2012 demolition specifications from the Board of Public Works called for the removal of all asbestos and a complete demolition of all structures on site. A summary of test results pertaining to the abrasive material on site was also included in the demolition specifications; based on the results, no special disposal method or
landfill type was required. The demolition specifications did require the proper drainage and
disposal of hydraulic material and water pits, and the proper removal of any containerized material. He explained that no additional testing was called for in the project’s phase one (1) environmental report, but out of an abundance of caution, the City contracted Heron Environmental LLC for soil and groundwater testing. He noted that samples were collected at
locations with a higher likelihood of contamination based on former site use and aerial
photography. He said the samples showed no evidence of contamination; metal concentrations were consistent with naturally occurring levels, and all other chemicals that were observed within
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300 City Hall | 215 S. Dr. Martin Luther King Jr. Blvd. | South Bend, Indiana 46601 | p. 574.235.9221 | f. 574.235.9173 | www.southbendin.gov
laboratory detection limits were several orders of magnitude below contamination levels. He stated that groundwater monitoring wells found no evidence of contamination, there were no
vapor encroachment concerns, and there was no visual or olfactory evidence of contamination
observed during the soil borings. Based on the results of the analysis, he said there is nothing that would require consideration for residential exposure or proper handling during development. He explained that the site is not enrolled in any Voluntary Remediation Program with the Indiana Department of Environmental Management (IDEM), it is not part of the Indiana Brownfields
Program, there is no open incident or active contamination to address, and conditions identified
in a 2010 Comfort Letter pertained to the building on site, which has since been demolished. For these reasons, he said it is not necessary for the City to seek a No Further Action letter, a Site Status letter, or any other closure from the state.
Joe Molnar provided more information about the project itself. He stated that KCG and the
Redevelopment Commission entered into a purchase agreement for the site in 2025, with the goal
of building fifty (50) new affordable housing units. He noted that this agreement was contingent upon the project receiving a LIHTC award, which was awarded by the state in November 2025. He stated that KCG is a mixed-use and multi-family housing developer based out of Indianapolis. He provided a breakdown of proposed rent prices according to household percent of area median
income (AMI): twenty-five (25) units will be restricted to sixty percent (60%) AMI, with one (1)-
bedroom units priced at seven-hundred-fifty dollars ($750) per month; fifteen (15) units will be restricted to fifty percent (50%) AMI, with one (1)-bedroom units priced at six-hundred-twenty-four dollars ($624) per month; ten (10) units will be restricted to thirty percent (30%) AMI, with one (1)-bedroom units priced at two-hundred-ninety-four dollars ($294) per month. He noted that
these prices are not achievable without City, state, and federal government support. He added that
KCG has partnered with the Housing Authority to provide a limited number of units for individuals with disabilities. The finished development will have a playground facility, patios and balconies, parking spaces for all units, and a brick façade.
Joe Molnar outlined the proposed loan agreement. He explained that interest rates and the cost of
labor and construction materials have increased substantially since last year, which has raised the
overall project cost from fourteen-million dollars ($14,000,000) to sixteen-point-seven million dollars ($16,700,000). He said the agreement requires a minimum private investment of fifteen-million dollars ($15,000,000), and the City would provide a one-point-seven million dollar ($1,700,000) loan to close the gap. He stated that the borrower would be KCG Donald & Main
LP, a project-specific entity that would be obligated to repay the loan if it abandons or fails to
complete the project. The one-point-seven million dollars ($1,700,000) would come from the South Side Tax Increment Financing (TIF) District. He described the loan structure as a zero-percent (0%) interest loan that would be due either upon maturity or upon refinancing by the developer, with no forgivable language. He added that the loan would be considered hard debt by
the developer, and it would not close until all other closing is finalized, with all financing fully in
place.
Committee Chair White invited questions from the Committee.
Citizen Member Kevin Upton asked how the property will be managed.
Megan Schuetz, KCG, 9311 North Meridian Street, Indianapolis, IN 46260, responded. She said
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300 City Hall | 215 S. Dr. Martin Luther King Jr. Blvd. | South Bend, Indiana 46601 | p. 574.235.9221 | f. 574.235.9173 | www.southbendin.gov
KCG hires experienced third (3rd)-party property managers through a national company with experience managing affordable housing developments. She added that KCG would be required
to own the property for at least fifteen (15) years, and the property would have to remain
affordable for at least thirty (30) years.
Citizen Member Upton asked if the property management company is WinnResidential.
Megan Schuetz confirmed that is correct.
Citizen Member Upton noted that they have a good reputation and a large national staff. He asked
if they would transfer a tenured employee or hire someone new for the property manager role.
Megan Schuetz said typically, they hire new property managers who are local to the community and experienced in residential property management.
Citizen Member Upton asked if they would seek a multilingual candidate.
Megan Schuetz replied that multilingual proficiency is typically listed as preferred but not
required on the job listing.
Citizen Member Upton asked about amenities.
Megan Schuetz described the property’s planned amenities which include a community room, fitness center, youth lounge and study space, playground, on-site management, secure fenced parking lot, appliances, and in-unit laundry.
Citizen Member Upton noted that fifty (50) units are income-restricted, and the site is two (2)
miles from the nearest major grocery store. He asked if there would be any shuttles or transit services provided.
Megan Schuetz said there is a small community grocery store nearby, and the site is located along a bus line.
Citizen Member Upton noted that WinnResidential has been nationally recognized for its
innovative late rent practices. He asked if those practices will be employed at this site.
Megan Schuetz said she could not speak to their practices specifically, but they work with residents to ensure they have an opportunity to pay, and payment plan arrangements are common.
Committee Member Bolden-Simpson asked if KCG representatives have met with administrators
from Riley High School and Monroe Elementary School.
Megan Schuetz confirmed that they have not yet met with the local schools. She said they typically do this as part of their outreach when they are getting ready to open up.
Committee Member Bolden-Simpson said she will hold her other questions for the 7:00 P.M. Council meeting. She strongly encouraged KCG to meet with the schools.
Councilmember Dr. Heidi Beidinger expressed concern regarding the lead levels in the tested soil
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300 City Hall | 215 S. Dr. Martin Luther King Jr. Blvd. | South Bend, Indiana 46601 | p. 574.235.9221 | f. 574.235.9173 | www.southbendin.gov
samples. She acknowledged that one-hundred-forty-three (143) parts-per-million (ppm) is below the EPA limit of two-hundred (200) ppm, but she noted that it is elevated relative to typical
“background” levels of thirty to forty (30-40) ppm.
Jim Bennett, Heron Environmental LLC, 55804 Ash Road, Osceola, IN 46561, responded. He said the testing methodology includes a statistical analysis that eliminates outliers from the sample set. He acknowledged two (2) data points that were slightly elevated at one-hundred-eight (108) ppm and one-hundred-forty-three (143) ppm respectively. He said those two (2) concentrations
are still well below the direct contact exposure threshold. Additionally, he noted that most of the
property would effectively be capped by the building, parking lot, and landscaping, with virtually no chance of direct contact with the soil.
Councilmember Dr. Beidinger expressed caution around claiming there will be no contact and noted that a small amount of lead can poison a child. She said the explanation that the building
will act as an engineered cap makes sense. She asked about the sampling methodology,
specifically whether samples were tested individually or in the aggregate.
Jim Bennett explained that they collect soil cores of five (5) feet or more and screen them in intervals, and the samples that were tested at this site were taken from the interval one to two (1-2) feet below the topsoil. He noted that IDEM considers soil from zero to ten (0-10) feet to be
surface material.
Councilmember Dr. Beidinger asked how many samples were tested for lead.
Jim Bennett replied that there were nine (9) samples. He said sample locations were chosen based on specific areas of concern that were identified from the property’s history and former site layout. He stated that nothing was observed in the soil conditions that would indicate cause for concern.
Councilmember Dr. Beidinger stated that she would err on the ultra-safe side, noting that it takes
only a few grains of lead dust, equivalent to the weight of a paperclip, to poison a child. She said it is important that the developer hears this conversation, noting that there are plans for a playground. She recommended re-testing the soil in the playground area and stated that if she encountered a lead result of one-hundred-forty-three (143) ppm in her lab at the University of
Notre Dame, she would advise families to monitor the situation, because the EPA threshold is
two-hundred (200) ppm.
Joe Molnar acknowledged that there were two (2) samples that exceeded one-hundred (100) ppm but were below the EPA threshold of two-hundred (200) ppm. He noted that the EPA threshold was previously four-hundred (400) ppm. He said both samples exceeding one-hundred (100) ppm
were taken from locations that will be covered by the building, and material will be removed and
capped with concrete when the foundation is put in place. He confirmed that he would review the lead results from the proposed playground area.
Committee Chair White acknowledged potential misinformation in the community and asked Joe Molnar if this project has the same developer as the Beacon Heights project.
Joe Molnar confirmed that it is a different company than the Beacon Heights project.
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300 City Hall | 215 S. Dr. Martin Luther King Jr. Blvd. | South Bend, Indiana 46601 | p. 574.235.9221 | f. 574.235.9173 | www.southbendin.gov
Committee Chair White opened the public hearing.
Sue Kesim, 4022 Kennedy Drive, South Bend, IN 46614, spoke in opposition. She asked if there
are any clauses requiring the use of local construction labor and if there are any sustainability
features such as lower utility use. She asked if the site has been rezoned as residential, noting that
the 2010 IDEM comfort letter only authorizes commercial and industrial redevelopment of the
site.
Joe Molnar confirmed that the site has been rezoned as residential with the urban neighborhood
three (U3) zoning designation. He stated that there are no restrictive covenants in place that would
limit it to commercial use.
Megan Schuetz stated that the building will be built to the Enterprise Green Communities green building standard, and they received points for this on their LIHTC application. She noted that
the project is currently in the open bid process, and no contractors have been selected yet. She
said KCG partnered with the City to send the bid out to hundreds of local and regional providers.
Committee Chair White closed the public hearing.
Committee Vice Chair Gooden-Rodgers moved to send Substitute Bill No. 69-26 to the
Committee of the Whole with a favorable recommendation, which was seconded by Citizen
Member Upton and carried by a vote of five (5) ayes with one (1) nay.
Committee Chair Karen L. White – Aye
Committee Vice Chair Ophelia Gooden-Rodgers – Aye
Committee Member Sheila Niezgodski – Aye Committee Member Sherry Bolden-Simpson – Nay
Citizen Member Tom Gryp – Aye
Citizen Member Kevin Upton – Aye
With no further business, Committee Chair White adjourned the Community Investment
Committee meeting at 4:37 P.M.
Respectfully Submitted,
Karen L. White, Committee Chair