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Home My WebLink About2011/12/06-Minutes-HEDCCITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE DECEMBER 6, 2011 Present: Committee Member Joel Burns, Chairman Committee Member Kathleen Hicks, Vice Chair (Arrived at 1:40 p.m.) Committee Member Salvador Espino Committee Member W. B. "Zim" Zimmerman Committee Member Danny Scarth Committee Member Jungus Jordan Committee Member Dennis Shingleton Absent: Committee Member Betsy Price Committee Member Frank Moss City Staff: Fernando Costa, Assistant City Manager Peter Vaky, Deputy City Attorney Ron Gonzales, Assistant City Secretary Jay Chapa, Director of Housing & Economic Development Department Cynthia Garcia, Assistant Director, Housing & Economic Development Department Robin Bentley, Community Development Manager, Housing & Economic Development Dept. Robert Stums, Manager, Housing and Economic Development Department Mark Rauscher, Senior Capital Projects Officer, Planning and Development Department Other City Staff in Attendance: Tom Higgins, City Manager Vicki Ganski, Senior Assistant City Attorney, Law Department LeAnn Guzman, Assistant City Attorney, Law Department Richard Zavala, Director of Parks and Community Services Department Mark Folden, Business Development Coordinator, Housing and Economic Development Dept. Henry Day, Senior Management Analyst, Housing & Economic Development Department Otis Thornton, Homeless Program Coordinator, Housing & Economic Development Department With a quorum of the committee members present, Chairman Joel Burns called the meeting of the Housing and Economic Committee to order at 1:12 p.m., on Tuesday, December 6, 2011, in the Pre - Council Chamber of the Fort Worth Municipal Building, 1000 Throckmorton Street, Fort Worth, Texas 76102, with Committee Member Kathleen Hicks temporarily absent and Committee Members Betsy Price and Frank Moss absent. CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE DECEMBER 6, 2011 Page 2 of 14 Approval of Minutes from November 1, 2011, Housing and Economic Development Committee (Agenda Item 2) MOTION: Upon a motion made by Committee Member Scarth and seconded by Committee Member Jordan, the Committee Members voted six (6) "ayes" and zero (0) "nays ", with Committee Member Hicks temporarily absent and Committee Members Price and Moss absent, to approve the minutes of the November 1, 2011, Housing and Economic Development Committee Meeting. The motion carried unanimously. Chairman Burns adjourned the regular meeting of the Housing and Economic Development Committee into Executive Session at 1:13 p.m. Executive Session (Agenda Item 3) Chairman Burns called to order the Executive Session at 1:13 p.m. in order to discussion the following items: A. Seek the advice of its attorneys concerning the following items that are exempt from public disclosure under Article X, Section 9 of the Texas State Bar Rules, as authorized by Section 551.071 of the Texas Government Code: (i) legal issues related to any current agenda items; B. Discuss the purchase, sale, lease or value of real property, as authorized by Section 551.072 of the Texas Government Code. Deliberation in an open meeting would have a detrimental effect on the position of the City in negotiations with a third party; and, C. Discuss or deliberate negotiations relating to any economic development negotiations, as authorized by Section 551.087 of the Texas Government Code. (Committee Member Hicks assumed her place at the table) Chairman Burns adjourned the Executive Session at 1:50 p.m., on Tuesday, December 6, 2011. Chairman Burns reconvened the regular session of the Housing and Economic Development Committee at 1:51 p.m. CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE DECEMBER 6, 2011 Page 3 of 14 Written Reports (Agenda Item 4) Chairman Burns advised that the following written reports had been provided as a matter of information to the committee members: A. Memo Regarding Timeline for Housing Trust Fund B. Memo Regarding Economic Development Program Agreement for Street Construction with Walmart, LLC. Chairman Burns opened the floor for questions and /or comments. There were none. Presentation of Recommendations for Award of HOME Funds and Housing Trust Funds for Quality Affordable Accessible Housing Proiects (Agenda Item 5) Ms. Robin Bentley, Community Development Manager, Housing and Economic Development Department, addressed the Committee regarding this issue. She began her PowerPoint presentation by providing the Committee with the following overview: • Request for Proposal (RFP) Timeline. • Funding Availability. • Proposed Development Summaries and Funding Requests. • Funding Recommendations. • Recommended Next Steps. Ms. Bentley followed the above information with a slide reflecting the RFP timeline below: • October 5, 2011 — RFP posted. • November 3, 2011 — All responses due. • November 12, 2011 — Public Notice • December 6, 2011 — Presentation to Committee. Housing and Economic Development • December 13, 2011 — M &Cs on the City Council Agenda for recommended projects. Ms. Bentley advised of the proposed funding as follows: CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE DECEMBER 6, 2011 Page 4 of 14 Presentation of Recommendations for Award of HOME Funds and Housing Trust Funds for Quality Affordable Accessible Housing Proiects (cont'd) • Up to $1,750,000.00. • Funding Sources: 0 2012 HOME Funds (estimated) o Housing Trust Fund General Funds (Agenda Item 5) Ms. Bentley then explained how the five (5) proposals received were evaluated based on the following criteria: • Project Location — 30 points • Proof of Site Control — 5 points • Project Description & Design — 50 points • Project Budgets — 15 points • Experience /Capacity — 20 points • Financial Capability — 10 points • Community Support — 20 points She then displayed an aerial view of the location of the Hunter Plaza building at 601 West First Street in Council District 9 that was located on the north side of downtown and depicted by an orange box. She showed a picture of the current status of the building and explained the Fort Worth Housing Authority's proposal to rehabilitate the structure as follows: • Proposal: Substantial rehabilitation and restoration of an existing 11 story structure into mixed I \income residential and retail /commercial Space on lower level. o Converting 225 units into 144 — 1 & 2 bedroom units 0 60% Affordable units and 40% market rate units • City Funds Requested: $1,500,000.00 • Total Development Costs: $24,114,573.00 • Amenities: • Library • Fitness Center • Theatre Room • Business Center • Community Room CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE DECEMBER 6, 2011 Page 5 of 14 Presentation of Recommendations for Award of HOME Funds and Housing Trust Funds for Quality Affordable Accessible Housing Proiects (cont'd) (Agenda Item 5) Ms. Bentley then displayed two slides that reflected proposed building elevations from two viewpoints. She transitioned to the set of slides that began with an aerial view of the proposed site for the NRP Group — Four Seasons project located at Oak Grove Shelby Road and South Race Street in Council District 8 with the site again depicted by an orange box. She advised that staff had recommended not funding this project because of the project's isolated location and provided the following background information: • Proposal: New construction of a 96 unit mixed - income multi - family complex. o 1, 2 & 3 bedroom units ranging from 712 to 1,112 square feet. • City Funds Requested: $750,000.00 • Total Development Costs: $13,023,105.00 • Amenities: • Community center and clubhouse with amenities such as workout room, computer room with internet access and kitchenette. • Support services offered at no costs t residents. • Child care and after school programs. • Adult GED. • Vocation and computer skills training. Ms. Bentley completed her comments on this project by displaying a slide that depicted proposed elevations for the community center and the apartment building. The briefing on the next project started with Ms. Bentley displaying an aerial view of the proposed site for the NRP Group — Mansfield Highway project located at Mansfield Highway and Parker Henderson Road in Council District 5, the project area again depicted by orange boxes. She advised the Committee that staff also recommended not funding this project due to its isolated location to retail and transit and provided information on the proposal as follows: • Proposal: Acquisition and new construction of a 288 unit 2 -3 story multi - family complex. o 1, 2, 3 & 4 bedroom units ranging from 712 to 1,561 square feet • City Funds Requested: $1,600,000.00 over two (2) years • Total Development Costs: $25,756,198.00 • Amenities: CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE DECEMBER 6, 2011 Page 6 of 14 Presentation of Recommendations for Award of HOME Funds and Housing Trust Funds for Quality Affordable Accessible Housing Projects (cont'd) (Agenda Item 5) • Community center and clubhouse with amenities such as pool, workout room, computer room with internet access and kitchenette • Support services offered at no cost to residents. • Child care and after school programs. • Adult GED. • Vocation and computer skills training. Ms. Bentley completed her comments on this proposed project by displaying an aerial view of the elevation at the site location which was followed by a slide pertaining to the conceptual site plan. She then displayed two (2) aerial views of the next proposed project for the Mooreland Fund I, LP — Mission Village located at McPherson Road (South Grove Estates Addition), in Council District 8 and advised that the project location was outlined by an orange box. She advised that staff also did not recommend funding this project as the location was not in a Community Development Block Grant Fund eligible area and provided the following background information: • Proposal: New construction of 36 single family houses in a platted subdivision. • City Funds Requested: $1,713,472.00 • Total Development Costs $19,259,277.00 • Scope of Work: • New construction of 2 and 3 bedroom houses. • Total Hard Cost Budget: $48,075.00 for 1,000 square foot house. • Cost per AC Foot: $48.08. • Approximately 800 to 1,000 square feet. • Affordable to four (4) person households at 60% of AMI. Ms. Bentley concluded this portion of her presentation by displaying a proposed elevation for one of the homes, followed by a picture of the front exterior of a sample house. The briefing on her last proposed project started with an aerial view of the proposed location for the YWCA of Fort Worth & Tarrant County — Permanent Supportive Housing Development located at 410 and 414 NW 26th Street, 401 Cliff Street and 2601, 2603, 2605 and 2607 Clinton Avenue, located in Council District 2. She advised that the specific addresses were indicated in orange and summarized the project for the Committee as follows: CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE DECEMBER 6, 2011 Page 7 of 14 Presentation of Recommendations for Award of HOME Funds and Housing Trust Funds for Quality Affordable Accessible Housing Projects (cont'd) (Agenda Item 5) • Proposal: Acquisition of land and new construction of an 85 unit, 4 story multi- family project. 0 1, 2 & 3 bedroom units. 0 60% affordable units and 40% permanent supportive housing units. • City Funds Requested: $750,000.00 • Total Development Costs: $8,367,184.00 • Amenities: • Community center with community meeting space. • Common kitchen for shared meals and cooking demos. • Supportive services such as employment support, subsidized child care, plus mental health and substance abuse care will be provided by the YMCA. Ms. Bentley completed her comments on this project by displaying a slide that depicted two (2) different elevations of the proposed building. She advised of the following funding recommendations from the staff: Organization CD RFP Score Funding Request Staff Recommendation YWCA — Permanent Supportive Housing (LIHTC) 2 124 $750,000.00 $750,000.00 Fort Worth Housing Authority — Hunter Plaza Redevelopment *(LIHTC) 9 114 $1,500,000.00 $1,000,000.00 NRP Group, LLC — Mansfield Highway (LIHTC) 5 106.5 $1,600,000.00 (over two years) $0.00 NRP Group, LLC — Four Seasons (LIHTC) 8 81 $750,000.00 $0.00 Mooreland Fund I, LP — Mission Village 8 68 $1,713.472.00 $0.00 Proposed HOME Funding $1,250,000.00 Proposed Housing Trust Fund Funding $500,000.00 TOTAL FUNDS $1,750,000.00 °-Low income rnousmg i ax Lrectit Ms. Bentley advised the Committee of the following proposed loan terms: CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE DECEMBER 6, 2011 Page 8 of 14 Presentation of Recommendations for Award of HOME Funds and Housing Trust Funds for Quality Affordable Accessible Housing Projects (cont'd) (Agenda Item 5) • Hunter Plaza: • $500,000.00 HOME loan ■ 15 -year loan term ■ 1 percent interest ■ Interest payments from cash flow; principal and accrued interest due at maturity. • $500,000.00 construction loan — Housing Trust Fund General Funds • 40 -month loan term • Interest at Applicable Federal Rate for midterm loans • Principal and accrued interest due at conversion to permanent financing • Construction proposed to begin in Winter 2012 if receives tax credit allocation. • YWCA: • $750,000.00 HOME loan • 20 -year loan term • 1 percent interest • Loan is forgiven on expiration of 20 -year affordability period • $100,000.00 pre - development loan ■ Urban Development Action Grant funds ■ 1 percent interest ■ If tax credits are not awarded, funds are due and payable within 30 days of notification ■ If tax credits are awarded, funds are due and payable at equity closing • Construction proposed to begin in Winter 2012 if receives tax credit allocation. Ms. Bentley concluded her presentation by advising the Committee of the recommended next steps as reflected below: M &C on City Council Agenda December 13, 2011 Letter of Support to Texas Dept. of Housing & Community Affairs January 2012 Conditional Commitment Agreements Executed January 2012 CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE DECEMBER 6, 2011 Page 9 of 14 Presentation of Recommendations for Award of HOME Funds and Housing Trust Funds for Quality Affordable Accessible Housing Proiects (cont'd) Chairman Burns opened the floor for questions and /or comments. (Agenda Item 5) Committee Member Espino commended staff for the thorough analysis of the RFPs and stated he was pleased to see the YWCA working on permanent supportive housing. He added that there had been challenges looking at sites in the City to move forward with the Directions Home program and that the YWCA did this the right way by reaching out to the community. Committee Member Shingleton asked what was the source of the Housing Trust Fund (FWHTF) General Funds. Ms. Chapa stated that a few years ago the City Council created the FWHTF in which HOME funds, CDBG funds and General Fund dollars were appropriated into the annual budget and then placed into the FWHTF. He added that the City placed funds in the FWHTF for two (2) years, not consecutive years, but individual years, with the intent to fund $2M a year on an annual basis. However, when the City had challenges with the budget that funding support stopped. He added that the funds were typically used for construction loans and pointed out that those funds got paid back and then revolved into other projects. He further added that General Funds were typically used for the short-term construction loans. He advised that another issue surfaced this morning and referenced the chart on recommended next steps and clarified that the letter of support went to the TDHCA along with a conditional contract for the loans for the two (2) properties that the Council would approve next week. He explained what occurred when staff received requests from other developers that wanted to submit tax credit applications and did not apply through this process, but wanted local support for tax credit projects. He stated that one of the things that was a normal practice for staff was to not necessarily provide resolutions to the City Council that provide support beyond that which staff was recommending for funding. He then asked for feedback from the Committee on continuing this practice and advised that the Committee would receive requests for this type of funding from developers as the March 1 `t deadline came closer. Committee Member Scarth stated that on occasion there were projects that were worthwhile that would achieve the same goals but did not require the City's support. Mr. Chapa stated that if they would have gone through our process, staff may have reduced the amount such as in the case of funding for Pilgrim Valley. He added that it was not fully funded but was still a successful project. He stated that some of the projects did not meet the criteria for being on transit lines, access to retail and jobs and that staff would work with individual Council Members to address projects that did not meet the criteria. CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE DECEMBER 6, 2011 Page 10 of 14 Presentation of Recommendations for Award of HOME Funds and Housing Trust Funds for Quality Affordable Accessible Housing Projects (cont'd) (Agenda Item 5) President Burns asked that staff review requests from developers on a case -by -case basis and to compare them with council priorities. This concluded the presentation and discussion on this agenda item. Presentation on Proposed Expansion of Alliance Foreign Trade Zone for TTI, Inc. (Agenda Item 6) Mr. Robert Sturns, Economic Development Manager, Housing and Economic Development Department, addressed the Committee regarding the proposed expansion. His PowerPoint Presentation began with a slide that provided the following background information regarding a foreign trade zone (FTZ): • An FTZ is a geographical area, where commercial merchandise receives the same customs treatment it would if it were outside the commerce of the United States. • Merchandise may be held in the zone without being subject to customs duties and other ad valorem taxes. • FTZ is designed to: • Lower the costs of U.S. -based operations. • Create and retain the employment and capital investment opportunities that result from those operations. • The City of Fort Worth has two zones: • DFW Airport Zone #39. • Alliance Zone #196. • In January 2009, the FTZ Board created the Alternative Site Framework (ASF). • ASF allowed for an expansion of the Alliance Zone to encompass the entire Alliance Corridor. Mr. Sturns then displayed two (2) slides. The first depicted a map of FTZ No. 196 areas that were indicated in green and pointed out that businesses in this zone would be able to automatically take advantage of the inventory tax exemption in the FTZ. His second map depicted the Alliance Corridor, Inc., FTZ Service area that was outlined in red and explained that it was under the ASF and that businesses coming into the expanded zone would also be able to take advantage of the foreign trade exemption; however it was not an automatic designation and CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE DECEMBER 6, 2011 Page 11 of 14 Presentation on Proposed Expansion of Alliance Foreign Trade Zone for TTI, Inc. (cont'd) (Agenda Item 6) they would have to apply to the City and the FTZ Board to activate their site. He added that the exemption was not transferable. His next slide provided a summary of the FTZ request from TTI, Inc., as indicated below: • Company would like to activate a FTZ license at two (2) facilities to fuel growth. • Company needs letters of concurrence from the City to get benefit of FTZ exemption on City taxes. • Currently have 753 employees in Fort Worth (340 are Fort Worth residents). He followed the above summary by displaying an aerial map of the two facilities at 2441 NE Parkway and 2601 Sylvania Crossing and advised that both locations were outlined in red boxes. Mr. Sturns then advised the Committee of the proposed agreement below: • Enter into a Payment in Lieu of Taxes (PILOT) agreement which will require TTI, Inc., to pay City taxes exempt by FTZ if commitments are not met. • TTI, Inc., will commit that by December 31, 2016: • Invest a minimum of $20.0 million in new real and personal property. • Employ an additional 100 new employees. • PILOT will expire if commitments are met within five (5) year timeframe. • Potential additional benefit Fort Worth is preferred location for a future 600,000 square foot operations center. Mr. Sturns advised the Committee of staff's recommended next steps as follows: • City Council approve the submittal of letter of concurrence to FTZ Board allowing for FTZ application to City taxes, and • Enter into a PILOT agreement to secure commitments. • City Council action regarding FTZ letter and PILOT agreement on December 13, 2011, Council meeting agenda. Chairman Burns opened the floor for questions and /or comments. This concluded the presentation; there was no discussion on this agenda item. CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE DECEMBER 6, 2011 Page 12 of 14 Presentation on Proposed Community Facility on Evans Avenue (Agenda Item 7) Ms. Cynthia Garcia, Assistant Director, Housing and Economic Development Department, addressed the Committee regarding the proposed community facility. The first slide of her PowerPoint presentation reflected an aerial view of the original boundary of the Evans and Rosedale area which was outlined in red. She provided the following background summary: below: • 1999 — City applied and received EDI Grant and Section 108 loan for the Evans and Rosedale area for economic development. • EDI Grant - $1,500,000.00 • Section Loan - $7,500,000.00 • Funds were to be used for loans for new businesses in the area to create jobs. • 2004 — City amended its application for these funds to include community facilities. o Funds used in the Hazel Harvey Peace building and the Shamblee Library. • Approximately $5 million still available for a project in the area. • Funds must benefit low and moderate income individuals. Ms. Garcia then provided information on the proposed project overview as indicated • City requested amendment to expand boundaries of the Evans and Rosedale area for the development of a public facility. • Proposal to lease building to United Community Center (UCC) for 30 years to operate, maintain all property and provide the following services for low and moderate income individuals: • Childcare • Youth after - school programs • Clothing pantry • Food pantry • Case management • Building will be approximately 10,000 — 15,000 square feet. She then displayed an aerial slide reflecting the current Evans and Rosedale Business and Cultural District and explained that the property outlined in blue and the property outlined in black was the proposed expansion area. She followed her explanation of two slides that showed the proposed elevations of the community facility from two different perspectives. She added CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE DECEMBER 6, 2011 Page 13 of 14 Presentation on Proposed Community Facility on Evans Avenue (Agenda Item 7) that the current building had a church and an addition would be built along with a parking area. Ms. Garcia's next slide showed an aerial view of the property to be acquired that was indicated by the color turquoise. She informed the Committee of the steps needed to complete the project as follows: • Meet all HUD regulations regarding use of funds. • Acquire land. • Obtain architect design. • Lease with UCC • Construction agreement She concluded her presentation by advising the Committee of the recommended next steps below: • Bring forward M &Cs on December 13`h • Fund the community facility with the EDI and Section 108 loan.\ • Acquire land necessary for the project. • Execute lease with UCC • Execute contract with BOKA Powell for architectural services. • Bring forward M &Cs on January 10, 2012, to execute contract with Enercon for environmental remediation. • Construction anticipated to begin in summer of 2012. Chairman Burns opened the floor for questions and /or comments. Committee Member Hicks stated that she was very excited about this project. She added that she attended the Bethlehem Center as a child and the new facility would really add some synergy with the new housing and other ED occurring on Evans Avenue and appreciated staff continuing to work with the community. She was recently at St. Andrews Church to speak with the church about the progress of the area and they were very excited about the project. Committee Member Espino commended Committee Member Hicks and the UCC for this project and expressed appreciation to the staff for their work. There was no further presentation or discussion on this agenda item. CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE DECEMBER 6, 2011 Page 14 of 14 Request for Future Agenda Items (Agenda Item 8) Chairman Burns opened the floor for requests for future agenda items. There were no requests for future agenda items. Date of Next Regular Meeting — January 10, 2012, (Agenda Item 9) Chairman Burns advised that the next regular meeting of the Housing and Economic Development Committee was tentatively scheduled for Tuesday, January 10, 2012. Adjourn (Agenda Item 10) With no further presentations or discussions, Chairman Burns adjourned the regular meeting of the Housing and Economic Development Committee at 2:18 p.m., on Tuesday, December 6, 2011. These minutes approved by the Housing and Economic Development Committee on the 7th day of February, 2012. APPROVED: C=) Joel Burns, Chairman Minutes Prepared by and Attest: --111 "1 P. Gonzales, Assistant City Secretary