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10/13/2020 Neighborhood and Affordable Meeting Minutes October 13, 2020 Housing Advisory Board City of Clearwater Main Library- Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 e Meeting Minutes Tuesday, October 13, 2020 Virtual Meeting 9:00 AM Main Library - Council Chambers Neighborhood and Affordable Housing Advisory Board Page 1 City of Clearwater Neighborhood and Affordable Meeting Minutes October 13, 2020 Housing Advisory Board Pursuant to Executive Order No. 20-69, issued by the Office of Governor Ron DeSantis on March 20, 2020, municipalities may conduct meetings of their governing boards without having a quorum of its members present physically or at any specific location, and utilizing communications media technology such as telephonic or video conferencing, as provided by Section 120.54(5)(b)2, Florida Statutes. Roll Call Present 4 - Chair Peter Scalia, Board Member Kevin Chinault, Board Member Camille Hebting, and Board Member Linda Kemp Absent 3 - Vice Chair Gabby Camacho, Board Member Carmen Santiago, and Board Member Peggy Cutkomp Also Present - Denise Sanderson — Economic Development & Housing Director, Chuck Lane — Economic Development & Housing Assistant Director, Patricia O. Sullivan — Board Reporter 1. Call To Order— Chair Peter Scalia The meeting was called to order at 9:00 a.m. Chair Peter Scalia and Board Members Linda Kemp, Kevin Chinault, and Camille Hebting attended the meeting using communications media technology. Also participating in the meeting were Economic Development & Housing Director Denise Sanderson, Economic Development & Housing Assistant Director Chuck Lane, and Board Reporter Patricia Sullivan. Live participation occurred in Council Chambers at the Main Library. To provide continuity for research, items are in agenda order although not necessarily discussed in that order. 2. Approval of Minutes 2.1 Approve the July 14, 2020 Neighborhood and Affordable Housing Meeting Minutes. Member Hebting moved to approve minutes of the July 14, 2020 Neighborhood & Affordable Housing Advisory Board meeting as submitted in written summation. The motion was duly seconded and carried unanimously. 3. Citizens to be Heard Regarding Items Not on the Agenda: None 4. New Business Items 4.1 Recommend Council approval of a loan in the amount of$880,000 to SP Clearwater WFH LLC, or affiliated corporation, using HOME Investment Partnership Program funding for the development of property at 306 South Washington Avenue; and authorize appropriate officials to execute documents required to affect closing. Page 2 City of Clearwater Neighborhood and Affordable Meeting Minutes October 13, 2020 Housing Advisory Board The Community Redevelopment Agency (CRA) issued an RFP (Request for Proposals) for redevelopment of its 306 South Washington site on August 17, 2020. The request called for a mixed-use or apartment development with a focus on workforce and market rate housing, the opportunity for shared parking to serve surrounding restaurant/retail businesses, construction to begin in 2021 and ample outdoor amenity space. There is currently a lack of rental supply for employees in the technology industry downtown, at Morton Plant Hospital and on Clearwater Beach who earn up to 120% of the Area Median Income (AMI). The CRA received responses from the Housing Trust Group, LLC and SP Clearwater WFH LLC. The review committee read the proposals, listened to presentations from each respondent, and ranked the projects based on developer experience and qualifications, legal and financial feasibility, ability to meet redevelopment objectives, and proposed construction timeline. The committee unanimously ranked SP Clearwater WFH LLC as the first choice and recommended moving forward with requesting authorization to negotiate. SP Clearwater WFH proposed to construct a 171-unit mixed income apartment development with 1-bedroom (725sf) units and 2-bedroom (925sf) units, a 275-space parking garage and tenant amenities including a pool, dog walking area, two playgrounds, exercise room and community room. Eighteen affordable units will be at 80% of AMI and below, 49 units up to 100% of AMI and 104 units up to 120% of AMI. The building will include high efficiency HVAC, Energy Star rated windows, low flow toilets and sound deadening construction. The parking area will include a dedicated Uber/Lyft area to support car sharing services and ample bicycle parking. Several aspects to the proposal provided long term housing affordability: 1) developer proposed that the CRA sell the land to the Pinellas County Land Trust which would own the underlying land in perpetuity. The land trust then would provide a 99-year lease to the developer; 2) rental rates set by the AMI established by Pinellas County could not increase more than 1.02% per year. Typically, market rate rental amounts increase more than 1% per year; and 3) investment of HOME funds required the City and developer to enter into a Land Use Restriction Agreement requiring up to 11 units to be rented at rates affordable to households earning less than 80% of AMI. SP Clearwater WFH presented an in-depth proposal, conducted environmental site studies, a market analysis to show the proposed rental rates were achievable for this project and obtained preliminary approval for construction financing from Neighborhood Lending Partners. SP Clearwater WFH received a construction cost estimate from Wichman Construction to provide an accurate overall project budget. The overall project cost was $38,436,995. In addition to the requested HOME loan, the applicant was requesting assistance: 1) Sell site to Pinellas Page 3 City of Clearwater Neighborhood and Affordable Meeting Minutes October 13, 2020 Housing Advisory Board County Land Trust for $3,420,000 and reinvest those funds into the project; 2) $2,200,000 from Penny for Pinellas IV Economic Development Grant funds for construction of workforce housing; 3) Provide $800,000 grant towards project in exchange for public parking; 4) Support application before Community Development Board to receive 3 housing units from the density pool; and 5) Defer $680,000 of$880,000 loan through affordability period (20 years), at which time it will be forgiven. The project was contingent upon support from all listed parties. The applicant anticipated receiving a decision on County funding within three months. To qualify for County funds, the applicant must show a good faith partnership with the CRA. Housing Division staff reviewed financial projections for the project and determined these terms were appropriate. SP Clearwater WFH's repayment of$200,000 of the loan will be amortized at zero percent interest over 20 years. City staff will recommend City Council approval of this proposal at tomorrow's City Council meeting. Economic Development & Housing Assistant Director Chuck Lane reviewed the Staff Report. The proposal had been presented to the City Council. In part, subsidies were necessary due to the high cost of constructing structured parking, some spaces will be available for public use and benefit nearby businesses. Phase 1 of the 4-story project should be ready for occupancy in September 2022 with Phase 2 completed in June 2023. One- and two-bedroom rental rates range from $791 to $1,007 for tenants up to 120% AMI and $660 to $838 for low income tenants, HUD will adjust this rate annually. Peter Leach with SP Clearwater WFH LLC has successfully built similar projects in Clearwater and is familiar with the process and guidelines. Member Chinault moved to recommend Council approval of a loan in the amount of$880,000 to SP Clearwater WFH LLC, or affiliated corporation, using HOME Investment Partnership Program funding for the development of property at 306 South Washington Avenue; and authorize appropriate officials to execute documents required to affect closing. The motion was duly seconded and carried unanimously. 4.2 Recommend City Council approval of the Second Substantial Amendment to the City of Clearwater's 2019-2020 Annual Action Plan to reallocate existing funding and to budget for additional funding provided by the United States Department of Housing and Urban Development to address needs resulting from the COVID-19 Emergency. In response to the Coronavirus Pandemic (COVID-19), the United States Department of Housing and Urban Development (HUD) notified the City of Clearwater that it will receive an allocation of$858,968 of Community Development Block Grant Program - Coronavirus Response funds (CDBG-CV) to be used to prevent, prepare for, and respond to COVID-19. This allocation was associated with the third tranche of funding authorized Page 4 City of Clearwater Neighborhood and Affordable Meeting Minutes October 13, 2020 Housing Advisory Board by the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), Public Law 116-136, signed by President Trump on March 27, 2020 to respond to the growing effects of this historic public health crisis. The City of Clearwater's federal Annual Action Plan detailed the funding strategy for the Community Development Block Grant (CDBG) and HOME Investment Partnerships Programs each year. The Annual Action Plan implemented a jurisdiction's multi-year Consolidated Plan and was developed through significant citizen participation, analysis, and planning. On May 7, 2020 the City Council approved a first Substantial Amendment to the City's 2019 Annual Action Plan (AAP) to incorporate $492,592 from the first tranche of CDBG-CV funding. The first Amendment to the 2019/20 AAP allocated the first tranche of CDBG-CV funds and reprogrammed existing funds to address COVID-19 impacts. Reprogrammed funds included deducting $300,000 of unencumbered funds from affordable housing programs to fund an emergency rent and mortgage assistance program. Now that other funding was available to fund a Rent, Mortgage and Utilities Assistance (RMU) Program, HOME funds will be reprogrammed back to affordable housing programs. Remaining CDBG-CV funds to be distributed: 1) Residential RMU Assistance: ED&H will continue to administer a program to distribute funds for unpaid housing expenses to qualifying residents whose incomes were affected by the pandemic. Additional CARES Act funds also were available for this program through a partnership with the Florida Housing Finance Corporation; 2) Public Services: for Program Years 2019/20 and 2020/21 and the CDBG-CV allocation, HUD eliminated the requirement to spend no more than 15% of the respective allocation on Public Services. The proposed amendment budgeted for expenditures in excess of the 15% cap for Public Services that mitigated or responded to impacts arising from the pandemic; and 3) Program Administration: HUD regulations provided for up to 20% of CDBG-CV to be used for costs associated with administering these programs. The City's General fund was not impacted by the proposed amendment. Summary of proposed Second Substantial Amendment: Funding Source - Project Name Current Change Proposed CDBG-CV - Business Assistance Program $3947074 -3927074 $ 27000 CDBG-CV - Rent/Mortgage/Utilities Assist $0 +9247458 $9247458 CDBG-CV - Public Services $0 +1547791 $1547791 CDBG-CV - Admin $ 98,518 +171,793 $270,311 CDBG-CV - Project Total $4927592 +8587968* $173517560 *New CDBG-CV allocation under third tranche of CARES Act funding Page 5 City of Clearwater Neighborhood and Affordable Meeting Minutes October 13, 2020 Housing Advisory Board HOME - RMU Assistance $300,000 -300,000 $0 HOME - Multi-Family New Construction $819,001 +150,000 $969,001 HOME - Owner Occupied Land Acquisition $100,000 +100,000 $200,000 HOME - Owner Occupied New Construction$560,000 +50,000 $610,000 Note: shown HOME fund balances did not represent the City's entire HOME budget, only line items affected by reprogrammed funds. City staff will recommend City Council approval of this item at tomorrow's Council meeting. Mr. Lane reviewed the Staff Report. Within 3 weeks of opening the process, staff received more than 300 applications for assistance that exceeded available funds and had to stop accepting applications. With additional funding, the City will reopen the process at 9:00 a.m. on October 19, 2020. Program information and applications were on the City's website. Staff anticipated a large number of applications due to expiration of the eviction moratorium. The City's rehabilitation program was put on hold while staff processed assistance applications and moved funds out the door, help with processing will be requested from a nonprofit or other City departments. Member Hebting moved to recommend City Council approval of the Second Substantial Amendment to the City of Clearwater's 2019/20 Annual Action Plan to reallocate existing funding and to budget for additional funding provided by the United States Department of Housing and Urban Development to address needs resulting from the COVID-19 Emergency. The motion was duly seconded and carried unanimously. 5. Old Business Items: None. 6. Director's Report Mr. Lane said an additional $535,000 of CARES Act funds was available for the Residential RMU Assistance program through the City's partnership with the Florida Housing Finance Corporation. On October 19, 2020, staff will start accepting applications for these funds which must be distributed by December 30, 2020. Once all of these funds are released, staff will restart moving CDBG funds. Mr. Lane reported Blue Sky would submit a second tax credit application for its proposed affordable housing project at the former Fire Station 45 site now owned by the CRA. While several applications in the County were anticipated, only one can be approved. Page 6 City of Clearwater Neighborhood and Affordable Housing Advisory Board Meeting Minutes October 13, 2020 Mr. Lane said staff had worked with the Clearwater Urban Leadership Coalition on a community led initiative to create a North Greenwood CRA separate from the downtown CRA. This week the City Council will consider approval of the nontraditional CRA that would provide a great opportunity to use TIF (Tax Increment Financing) to invest in people rather than brick and mortar infrastructure. Funds would provide direct assistance to neighborhood residents through social services and job training. In response to a question, Mr. Lane said Prospect Towers, a 208 -apartment building downtown, had long provided affordable housing for Seniors. The investor who purchased the property increased rents; many households could not afford higher rates. Senior Citizens Services (SCS) has offered to subsidize a Directions for Living (DFL) case manager for 3 months to make referrals and help tenants locate new housing. SCS also will provide an additional $30, 000 to be used at DFL's discretion in assisting tenants. CDBG-CV funds can be used for homeless prevention for this population at increased risk of experiencing serious health conditions as a result of catching the virus. Residents will need additional help. Staff was complimented for pulling together the right players for the Task Force assigned to review this issue. 7. Board Members to be Heard: None. 8. Adjourn The meeting adjourned at 9:35 a.m. Chair Attest: Neighborhood & Affordable Housing Advisory Board Board Repo Page 7 City of Clearwater