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HomeMy WebLinkAbout07-09-14 Community Affordable Housing Advisory Board MinutesCity of Bozeman Community Affordable Housing Advisory Board (CAHAB) July 9, 2014 8:00 – 9:00 am City Commission Room, City Hall Attending:      Brian LaMeres, Mary Martin, Anders Lewendal, Melvin Howe, Ann Kesting, Dave Magistrelli, Kevin Thane, Commissioner Carson Taylor Absent: Kris Keller, SharlaRae Stuber Staff: Tracy Menuez, HRDC; Wendy Thomas, Community Development Director Public: Sam Long, Summit Housing Group The meeting was called to order at 8:02 am by Chair Brian LaMeres. New board member Kevin Thane was welcomed and board members introduced themselves. Changes to Agenda: None Approval of Minutes from 6-11-2014 Anders Lewendal moved to approve the minutes from 6-11-2014; Dave Magistrelli provided the second. Motion was approved unanimously. Public Comment: None Action Items Request for letter of support to Montana Board of Housing Low Income Housing Tax Credit (LIHTC) Program for Stoneridge Apartments – Summit Housing Mary Martin declared a conflict of interest as an employee of the HRDC, a partner on the project. Tracy Menuez reminded the group that she is employed by HRDC as well. Tracy introduced Sam Long of Summit Housing to present the Stoneridge Apartments proposal. Sam reminded the group that they have reviewed this project before, and that there are no significant changes. The market study was recently updated, and vacancy rates continue to be near zero, and are at zero with waiting lists for subsidized properties. This is Summit’s 4th submittal of the project for funds, and Sam feels that the project will be funded this year. In the previous round the project received a perfect score with the exception of rehabilitation points, but that credits were heavily allocated to Eastern Montana. He thinks that the board will see that it is time to fund a project in Bozeman. Dave Magistrelli asked what support the City had provided in the previous year. Tracy replied that the City had provided the letter of support and a 100% impact fee reimbursement for those units renting at 40% AMI and less. Kevin Thane commented that even at 40% AMI, many families would struggle to afford these units, and that most of the units are at higher income levels. Sam Long conceded that, yes, households with incomes below 30% AMI would be stretched, but that all of the units, even those at 50 and 60% AMI are slated to rent at well below market prices. Sam added that a mix of units at the 40, 50 and 60% levels is necessary to make a project work financially. They have found that their construction and materials costs are increasing, however; they were able to secure the land at a low cost which will help keep cost/unit developed low. Sam stated that Summit builds, manages, and owns their properties, so they have an incentive to produce a quality product. Summit has also committed to keeping this project affordable for 45 years (30 years longer than required by IRS regulations) to remain competitive for funding. Anders Lewedal asked how many units stay affordable at the elected levels. Sam Long replied that all units have to stay in their elected affordability band for the entire 45 year period. Brian LaMeres asked how an application can score the most points and remain unfunded. Sam Long replied that the points are used to ensure projects meet threshold, after that, funding is at the board’s discretion. Last year the pressure to move credits to eastern Montana to address the oil boom resulted in few credits awarded elsewhere. Brian asked if there were any significant changes to the application, other than the more official partnership with HRDC. Sam replied that there were not, and that given the high score of the previous year, Summit preferred to emphasize those attributes that helped it score so high, namely the lowest cost/square foot of any other units proposed. Anders Lewedal asked about the one unit not included; Sam Long replied that is the on-site manager’s unit. Kevin Thane asked if Summit is a for-profit corporation; Sam replied that it is. Kevin asked why air conditioners were included – they seem costly and unnecessary. Sam replied that it is actually an important amenity for the clients. He added that the scoring methodology essentially required it as other projects will include it, particularly those in Eastern Montana, and not including it will cost the project points for amenities. Anders asked where on the Home Energy Rating System (HERS) the units scored? Sam replied that the units are HERS rated, but he was not sure of the score and could gather that information. Carson Taylor asked how the points are allocated. Tracy replied that the state publishes the Qualified Allocation Plan (QAP) annually to explain the scoring of LIHTC applications. Carson commented that maybe the board should consider weighing in during the next QAP cycle regarding things like air conditioning and energy efficiency. Sam agreed that the QAP should award low cost/square foot and acknowledge that every part of the state is different and may require differing amenities, however; under this QAP, to be competitive, Stoneridge will be putting in air conditioning. Ann Kesting commented that she is seeing an increasing demand for air conditioning among all clients, at every price point, and if this project is going to be competitive for 45 years, it’s a good amenity to consider. Anders commented that they are constructing tighter units that won’t leak air and demand air conditioning. Sam replied that while he doesn’t disagree with the comments, air conditioning is a popular amenity, particularly in apartments where people may be on second floors and with fewer windows to manage air flow. Brian LaMeres asked how the relationship with HRDC is different in this year. As representative of the HRDC, Mary Martin replied that HRDC will provide our support for households entering Stoneridge, including Ready to Rent and financial education programs. Kevin Thane asked if these are different than the services typically offered. Mary responded that the difference is that HRDC will be able to bring those services on-site to the customers rather than needing customers to come to HRDC. Sam added that the partnership with a local entity is essential in their point of view. Anders commented that the rents are far less than those in the market, and recognizes that the tax credit program is really the only way to get to rents that low. Anders Lewendal moved to recommend that the City Commission provide a letter of support to Summit for the Stoneridge apartments. Dave Magistrelli provided the second. The motion passed, with Mary Martin abstaining. Request for impact fee support for units renting for 40% AMI and less by Stoneridge Apartments – Summit Housing Mary Martin reminded the group of her conflict. Ann Kesting moved to recommend the impact fee support for units renting for 40% AMI and less. Melvin Howe provided the second. Brian LaMeres asked if the support is for 100% of impact fees. Tracy replied that the request is the same as last year, 100% of impact fees for the 6 units at or below 40% AMI, as stated in our housing plan. She reminded the group that the support was already recommended in the City budget process, and the action today simply ties the support to a particular project. Dave Magistrelli called for the question. The motion passed, with Mary Martin abstaining. Tracy informed the group that the issue would be in front of the City commission on July 21. Department of Community Development request for letter of support for Community Development Block Grant (CDBG) Planning Grant application seeking funds to study the Neighborhood Conservation Overlay District (NCOD) and the effect of the program on the supply of affordable housing in the district.  Wendy Thomas, Community Development Director, presented the City’s request for support for the CDBG Planning Grant application. She explained to the group that the City has been exploring the necessity of updating the historical homes inventory in the NCOD. The last time the inventory was completed was 1984, and many homes may now be included that were not in the previous study. The City wishes to assess how many homes are now historically significant or contributing. In the North side of the district, homes tend to be smaller and more affordable. The lots are relatively large, however; and there has been significant pressure on property values as buyers attempt to build larger and sometimes multiple residences on these lots, replacing the smaller, more affordable homes. The CDBG planning grant will supplement funds the City has identified to pay for this updated study and allow for a more in-depth, holistic view of the issues of historic preservation, redevelopment, and affordable housing. Dave Magistrelli moved to provide a letter of support as requested. Melvin Howe provided the second. Anders Lewendal asked if the City receives the funding and finds that historic preservation guidelines adversely impact affordable housing, will the City change the requirements? Wendy replies that would be the Commission’s decision after a review of the information. Ann Kesting asked how this ties with affordable housing. Wendy replied that there are two relationships: first, housing on the north side is generally more affordable, and second, the link between accessory dwelling units (ADUs) and affordability. Wendy conceded that historic preservation can sometimes conflict with affordability, but that there are instances where it can support affordable housing as well. Kevin Thane asked if a historical designation disallows an ADU. Wendy responded that is does not at this time, but that there may be other factors that result in an ADU not being allowed. Dave Magistrelli called for the question. The motion passed with the absence of Ann Kesting, who had to excuse herself from the meeting before the vote was taken, Non-Action Items - None FYI/Discussion Melvin told the group that the conversation regarding air conditioners had been interesting, but that he was supportive of including them in units. Adjourn – Meeting was adjourned at 9:40 am with a motion by Dave Magistrelli.