HomeMy WebLinkAboutPCDC Minutes 05/01/2000May 1, 2000 Vol. , Page 1
1 Minutes
2 of a Regular
3 Petaluma Community Development Commission Meeting
4
5
6
7 Monday, May 1, 2000
8 Council Chambers
9
10 The Petaluma Community Development Commission met at 3:00 P.M. on this date in
11 the Council Chambers.
12
13 ROLL CALL
14
15 PRESENT: Commissioners Healy, Keller, Maguire; Vice Chair Torliatt
16
17 ABSENT: Commissioners Cader-Thompson, Hamilton; Chair Thompson
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19 PUBLIC COMMENT
20
21 None
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23 COMMISSION COMMENT
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25 None
26
27 AGENDA CHANGES, ADDITIONS, DELETIONS
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29 None
30
31 MINUTES
32
33 MOTION: Commissioner Maguire moved, seconded by Keller, to approve the
34 minutes of the April 17, 2000 meeting.
35
36 MOTION
37 PASSED: 4/0/3 (Cader-Thompson, Hamilton, Thompson absent)
38
39 NEW BUSINESS
40
41 1. Review of FY 2000/2001 Affordable Housing Program and Budget
42
43 a. Resolution Approving the Housing Budget for Inclusion in the FY
44 2000/2001 Non -Housing Budget.
45
Vol. Page 2 May 1, 2000
1 Housing Administrator Bonne Gaebler presented the FY 2000/2001 PCDC
2 Housing Program and Budget. She advised the Non -Housing Budget is being
3 completed by Paul Marangella and will be presented with the City Budget and at
4 that time the Housing and Non -Housing Budgets will be merged. Because
5 almost all of the housing work is done through non -profits, the housing budget is
6 almost always presented for Council's approval early so those agencies can, in
7 turn, plan their fiscal year budgets. Ms. Gaebler, referring to a visual aide,
8 advised that the estimated revenues for FY 2000/2001 are $4,966,550.
9
10 Expenditures, which were also included in the staff report, included funding to
11 address the Commission's ongoing goal to provide housing for the broad
12 spectrum of all in need.
13
14 Ms. Gaebler brought the Commission up to date regarding ongoing projects. Old
15 Elm Village and the Edith Street Apartments should start construction this
16 summer. A Phase 2 soil analysis of the Hopper Street site for the new home of
17 the single shelter and opportunity center has been completed, and the project will
18 hopefully be completed in the fall of 2002. The Petaluma Downtown apartment
19 complex is also entering soil analysis stage.
20
21 Ms. Gaebler, using a visual aide, indicated the location of the McNear Park
22 property. She also responded to a question of what Commission action is being
23 requested. At one time, the property was purchased thinking it would be a six -
24 unit complex, but that would now be very difficult to finance. One year after the
25 City purchased the property; it purchased the Boys' and Girls' Club and owned
26 everything on the block except one piece of property. The City has the
27 opportunity to repurchase it for the carrying cost and it can become part of the
28 master plan for McNear Park.
29
30 Commissioner Keller asked if it bordered private residences.
31
32 Ms. Gaebler replied that it did, on `F' Street. She also advised that before the City
33 can purchase property, the Commission requires a Notice of Acceptance. With
34 approval, the City can go ahead and it would appear on a consent calendar. The
35 action requested of the Commission today is to adopt a resolution approving the
36 fiscal year budget and housing program. She advised that the excellent nonprofit
37 applicants were in Council Chambers.
38
39 Vice Chair Torliatt announced that one of the budget items under Community
40 Revitalization for the Old East Petaluma neighborhood would be pulled from the
41 budget because, if it were not pulled, there would not be a quorum because
42 Commissioner Maguire would have a conflict of interest.
43
44 City Attorney Rich Rudnansky advised that it could be taken separately with
45 Commissioner Maguire stepping down. The Commission would vote on the
46 budget, minus that portion. Commissioner Maguire could then step down from
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May 1, 2000
Vol. , Page 3
the dais, and the portion on which he had the conflict could be voted upon. He
recommended that the vote be put over to the evening to take advantage of a
quorum.
Commissioners Keller and Maguire acknowledged Ms. Gaebler's sterling efforts
and thanked her.
Commissioner Healy noted that he had questions regarding Eden's project, i.e.,
building a portion at "market -rate" instead of "below market -rate" among other
issues.
ADJOURN
The meeting adjourned at 3:35 p.m.
RECONVENE
The Petaluma Community Development Commission reconvened its regular meeting at
7:10 P.M. on this date in the Council Chambers.
ROLL CALL
PRESENT: Commissioners Cader-Thompson, Hamilton, Healy, Keller,
Maguire; Vice Chair Torliatt
ABSENT: Chair Thompson
PLEDGE OF ALLEGIANCE
At the request of Vice Chair Torliatt, Jay Gamel led the Pledge of Allegiance
PUBLIC COMMENTS
None
COMMISSION COMMENTS
None
UNFINISHED BUSINESS
2. Discussion and Possible direction Regarding LOK Marina Hotel Development
Group and City Participation in Financing for a Three Star/Four Diamond Rated
Hotel.
Vol. , Page 4
May 1, 2000
2 City Manager Fred Stouder provided a verbal status report on the project. The
3 City received that day the most recent draft of the joint participation agreement.
4 There has been no time for review, so there are no recommendations. He offered
5 an opportunity for discussion and questions. He also requested that the
6 Commission confirm its intent and interest in furthering that project. The major
7 issue at that point is the matter of personal guarantees as part of the joint
8 participation. The Lok hotel representatives were present to participate in
9 discussion.
10
11 Kurt Lok spoke regarding financing for the project. The hotel has put together its
12 investor pool totaling $6 million. The Lok family has spent over $3.6 million. They
13 will be borrowing another $15 million to see the project move forward. The
14 construction drawings are out to bid. They are faced with a critical construction
15 deadline, especially regarding the ordering of steel. The building is made
16 primarily of steel and steel requires 18 to 21 weeks to deliver. If construction is to
17 begin this fall, they need to have the agreement ready.
18
19 Commissioner Maguire asked Mr. Lok to review anything new and different in the
20 proposed agreement.
21
22 Mr. Stouder added that Brent Hawkins, a City attorney and Tim Kelly, who did the
23 feasibility study, were also available for questions.
24
25 Don Blackman, Attorney for the Lok family, had just received the latest draft and
26 had not yet reviewed it. There was one substantive issue: a personal guarantee
27 regarding the monies to be deferred.
28
29 Commissioner Maguire spoke regarding the safeguards relative to the City's
30 participation and the public risk in the project. He asked what were structured as
31 specific guarantees and what were risks involved.
32
33 Mr. Blackman explained that a memorandum of the agreement would be
34 recorded in the chain of title to the hotel so that the hotel could not be voluntarily
35 sold or voluntarily refinanced without compliance with the agreement, including
36 the repayment provision. If the conservative financial projections were
37 pessimistic and the hotel did better than the projections, there would be no need
38 to draw down on the transfer occupancy tax deferment as contemplated by the
39 document.
40
41 Tim Kelly, Kaiser Marston Associates, presented this same issue back in January
42 and was there to get the Commission's consensus so the document could be
43 finalized. He believed this was a win-win situation for the City and the Lok family.
44 The agreement was structured so that if certain room rates were charged, there
45 would be no need for assistance. It provided an incentive to proceed. If the hotel
46 does well, there would be deferred payment until it was sold. The questions had
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May 1, 2000 Vol. , Page 5
been asked: was the payback a guaranteed amount? Would it be paid back
regardless of the hotel's performance? The payback was based on performance.
There have been subsequent discussions about that amount of money being
guaranteed regardless of the performance.
Commissioner Maguire asked for clarification that if the City loaned the money
and payback was based on good performance, then if the hotel did not do well,
there would be no payback.
Mr. Kelly advised that the hotel would still be there and producing transient
occupancy taxes, but the City would not get paid back.
Commissioner Maguire asked if the hotel went bankrupt, how would the City be
reimbursed?
Mr. Kelly explained that the City would have a contract signed by the Lok family
to pay the amount owed.
Vice Chair Torliatt said the City had no contract now.
Mr. Kelly understood that. One of the fundamental issues at this time was
completing a draft of such an agreement.
Commissioner Healy asked what the deadline was to make this year's
construction window.
Mr. Lok replied that it would have to be within the next two weeks.
Commissioner Keller noted that if steel delivery took four to five months, that
would be October. Could the piles still be driven in October?
Mr. Lok explained that the piles, which are separate from the steel, would be
ordered, the pile caps would be done, and then they would wait until the steel
was actually delivered.
Commissioner Keller clarified that by October the foundation would be in place
and would be ready for steel.
Mr. Lok agreed.
Commissioner Maguire asked what other forms of security had been considered.
Mr. Lok replied that between his family and investors, they have $9.6 million at
risk. The City's money would not be at such risk. Mr. Lok spoke of his reputation;
he has been in this community for over fifteen years; the family has a hotel built
Vol. , Page 6
May 1, 2000
1 in 1984, which has survived during tough times. His reputation in business and
2 the community are very important to him.
4 Commissioner Maguire asked what would happen if Mr. Lok were replaced.
6 Mr. Lok advised he was willing to sign a personal guarantee, which he described
7 as "bad public policy."That would force him to look over the Commission's
8 shoulder every time a hotel comes to town.
9
10 PUBLIC COMMENT
11
12 Don Weisenfluh, 1092 Wren Drive, spoke in opposition to the location of the Lok
13 Marina Hotel Development. He voiced concern about people coming to town to
14 stay in a nice hotel, eat in a nice restaurant just to look out to see Petaluma River
15 Bridge, and the rotting train trestles, the gravel operation on the hill, or the
16 industrial park that surrounds the bridge, or experience the fragrance of the
17 sewer treatment plant during the summer. If the Commission was putting City
18 money at risk, he cautioned them that the area is not good or appealing for a
19 hotel.
20
21 Diane Reilly Torres, Rainier Avenue, mentioned that there was an item that was
22 held over from that afternoon's PCDC meeting and asked if it was the currently
23 discussed item.
24
25 Vice Chair Torliatt advised it would be the next item.
26
27 Vice Chair Torliatt advised that the Commission would either confirm that it would
28 go forward with the hotel or address concerns at that time. She mentioned there
29 was a second item regarding a personal guarantee issue. She asked for
30 comments from Commission members.
31
32 Commissioner Hamilton asked for the meaning of `personal guarantee" and
33 whether or not it was a usual method of securing a contract.
34
35 City Attorney Rich Rudnansky was not aware of it in Petaluma before. It was City
36 Management's understanding that there was a need for this.
37
38 Mr. Stouder was not aware that the City had a history of personal guarantees on
39 redevelopment partnerships. The Commission would be more familiar with that.
40 He did not know of what other cities required personal guarantees. He has been
41 a party to an agreement in which the personal guarantees of the owners and
42 spouses were part of the project. It was more a matter of the Commission's
43 comfort level; it is something he asked for as part of his role in trying to negotiate
44 what he viewed to be a secure redevelopment agreement. It was a policy
45 question.
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May 1, 2000 Vol. , Page 7
Commissioner Keller asked Mr. Stouder to provide an updated summary of City
monies spent and what the risk might be for the City.
Mr. Stouder asked Tim Kelly to review the components of the proposal from the
January report.
Mr. Kelly advised that the Agency is putting out $750,000 for site improvement
costs, which is a hard dollar number up front. The other is a sharing of the
transient occupancy tax, which is not a hard dollar number until it is actually paid
by the hotel. Then, it goes back to the Agency, back to the hotel owner.
Commissioner Keller clarified that the $750,000 would be an up front contribution
toward site development; in this case specifically for the parking area and some
of the infrastructure.
Mr. Stouder said that was based on the construction contract not to exceed
$750,000 and based upon invoices from the construction contractor. It was not
transmitting $750,000 for parking lot improvements; it was based upon the
invoice from the contractor.
Commissioner Keller clarified that it was to a maximum of $750,000.
Mr. Stouder agreed.
Commissioner Keller asked how the $750,000 would be repaid.
Mr. Kelly answered that the repayment now is through the participation
agreement; which would last as long as the Lok family was the owner.
Commissioner Keller asked for clarification for the public's sake.
Mr. Kelly advised that payment would start in year 2010 or 2011 at $25,000 a
year and increase by that amount every year until the money was paid back or
they sell the hotel. The mechanism by which the payback was made was sharing
in the proceeds of the sale.
Commissioner Maguire asked how many years would it take to pay back at that
rate.
Mr. Kelly answered that it depended on the economic value of the hotel when it
was sold.
Commissioner Keller asked how long it would take to pay back if ownership was
retained.
Vol. Page 8
May 1, 2000
1 Mr. Kelly answered that the $25,000, $50,000, $75,000 is a separate payment -
2 an incentive payment. They have a choice. The owners want to refinance and
3 pay back in year 2010. The other mechanism was with the sale.
4
5 Commissioner Keller asked to take the first case again, where they retain
6 ownership, at what interest rate is the $750,000 to be repaid?
7
8 Mr. Kelly advised that it was an open issue.
9
10 Mr. Don Blackman advised that in the draft agreement, there was no interest to
11 be paid. The payments Mr. Kelly referred to are incentives to the Lok family and
12 their investors to refinance the hotel prior to that time, and that was their intent.
13 The eventual repayment of the principal amount of deferred payments would
14 come through the refinance or sale of the hotel. At that time, 50% of the profit
15 made by the Lok family would be paid to the City in repayment of the full amount,
16 not to exceed the amount the City has deferred from the transient occupancy tax
17 payments plus the $750,000 — total $2,750,000.
18
19 Commissioner Keller clarified that the TOT would be reimbursed up to the
20 maximum of $2 million at 50%.
21
22 Mr. Blackman answered that the total amount of deferred payments would be $2
23 million, so that would be the maximum amount repaid.
24
25 Mr. Kelly said there is an obligation on their part to build what they agree to build,
26 which has a certain dollar amount. If they don't spend that money, they don't get
27 any TOT. They cannot promise one product and build another. The other
28 condition is that the hotel must continuously operate at a Four Diamond or Three
29 Star rating. If, during the ten years, they do not retain that rating, they have to
30 repay the City the money at that point.
31
32 Commissioner Keller asked if eight years from now, economic forces did not
33 allow the hotel to maintain its rating, what would be the City's risks?
34
35 Mr. Brent Hawkins advised that in a worst-case scenario, that would be the
36 $750,000 up front and the $2 million cap on the TOT rebate.
37
38 Commissioner Keller said that the City would be in the hole for $2,750,000 at the
39 most. The question was what vehicle, other than forced sale of the hotel, could
40 be used that would not require the City be given a personal guarantee, and
41 would minimize the financial risk to the City.
42
43 Commissioner Maguire thought the agreement should include a clause allowing
44 the City to revert to a longer pay back schedule at a revised interest.
45
May 1, 2000 Vol. , Page 9
1 Mr. Hawkins advised there were a number of different ways to secure the
2 obligation. It could be secured with a deed of trust on the property. He guessed
3 the developer would be willing to do that, but it would require that the trust be
4 subordinate to many things, including the first lender, the equity investors. It
5 would not be a satisfactory way of securing the obligation. Another possibility
6 would be to get security on some other property where the City would be in a
7 less junior position. Another would be a personal guarantee. He has been
8 involved in many of these kinds of transactions with twenty years of experience
9 and advised that it was unusual, but not unheard of, for a redevelopment agency
10 to get a personal guarantee.
11
12 Commissioner Keller stated that he would really like to see this work.
13 Unfortunately, the redevelopment agency in this City has made bad deals in the
14 past. The City has had to spend a lot of money making up for those worst-case
15 scenarios that were not supposed to happen. He did not want to leave it to the
16 future to bail out a project. His questions were not meant to slight Mr. Lok or his
17 work.
18
19 Commissioner Cader-Thompson wanted to make sure that the City was
20 protected. Money is still owed on the Marina deal and she did not want to pile
21 more on the current debt. She wanted to be sure the City was protected and got
22 its money back.
23
24 Mr. Hawkins advised that the City needed to make a fundamental decision as to
25 whether it is a lender or an investor. A lender expects to get repaid on a schedule
26 and has a precise period of repayment with a fixed interest rate. An investor
27 takes risk. The developer would like the City to be an investor and if the project
28 does well, the City will be paid back. That does put the City at risk. The concept
29 of personal guarantees puts the City in the position of a lender. If the project
30 does not do well, there is recourse directly against the developers.
31
32 Commissioner Cader-Thompson noted that it seemed as though the City is
33 always taking the risk. It has been the citizens paying out the money.
34
35 Mr. Hawkins advised that part of the reason redevelopment agencies exist is that
36 private industries do not want to go into these areas without assistance, so the
37 state created redevelopment agencies to provide a vehicle for the cities to
38 participate in development risk. The City needed to decide how much risk it
39 wanted to take on.
40
41 Commissioner Cader-Thompson mentioned there would be more projects
42 coming up and the potential for more people to use the redevelopment money in
43 areas that are truly blighted.
44
45 Mr. Kelly said the City needed to decide what the public benefit of the project
46 would be. In this case, the public benefit would be a conference room of up to
Vol. , Page 10 May 1, 2000
1 9,000 square feet, a restaurant, a hotel that they believe is greater than they
2 would build, were they acting on their own. The primary money at risk is the hard
3 money up front from the redevelopment agency, which would be a maximum of
4 $750,000. After that, they have to build the product to spend the money or the
5 City does not give them the TOT. The hotel would be built at that point.
6
7 Commissioner Cader-Thompson thought it would be a successful business.
9 Mr. Kelly stated that this was an argument about what the room rates will be in
10 2002 and 2003. If the room rates are $130/$140 a night, the City will get the hotel
11 without putting in any money.
12
13 Mr. Kirk Lok advised that based on an analysis, in the first ten years, the hotel
14 would generate $9 million revenue for the City, most of it in TOT, which is
15 general fund dollars, and another $3 million in property tax. He was asking the
16 City to lend $2.7 million to make this a successful project.
17
18 Commissioner Healy asked Mr. Kelly to put the City's risk profile in perspective.
19 He asked how many similar projects have had paybacks on financial incentives
20 and how many have guarantees around financial incentives.
21
22 Mr. Kelly's experience is that the guarantee is usually limited to completion of
23 construction, which the lender will want. The guarantee typically is not over the
24 long-term payback. The paybacks tend to be based upon participation, unless
25 the agency is truly just a lender, but typically in redevelopment agency
26 agreements, you are dealing with a product that the private market acting on its
27 own wouldn't build and there is risk in that. That is a judgment decision. Full
28 service hotels are hard to finance today because of the greater cost to build. It is
29 easy to finance something that is not full service, such as a traveler's hotel.
30 Working with other cities, they do participate in making projects happen that are
31 greater than what would otherwise have been built. The cities include Santa
32 Rosa, San Jose and Sacramento. The payback mechanism is typically based
33 upon performance, not on a loan. If it is characterized as a loan, it is still based
34 on performance because it will be subordinated.
35
36 Commissioner Healy asked if Santa Rosa or Sacramento drafted agreements
37 that provided greater security.
38
39 Mr. Kelly replied that what cities want is for the project they to be built, which
40 means working drawings, a franchise, operating agreement, and financing
41 commitments. If the project does well, public dollars are returned through the
42 performance.
43
44 Commissioner Healy thought that as a community, the City was more of an
45 investor. There was some inherent risk, but the paybacks make it a reasonable
46 risk. He was concerned about missing the construction window and wanted to
May 1, 2000 Vol. , Pagel 1
1 have this brought back in two weeks for a final decision. He did not see the value
2 in requiring a personal guarantee.
4 Vice Chair Torliatt mentioned the possibility of reviewing a hotel proposal for the
5 downtown area. She was concerned about viewing that as a subsidy to
6 development also. It was her understanding that the proposal would be for
7 private parties to pay in total. She did not know why this hotel at the Marina
8 would not be able to pay for itself. She referred to the benefits mentioned by Mr.
9 Kelly, i.e., conference rooms, etc., and opined that the City could take the TOT
10 funds from another hotel and build its own conference rooms.
11
12 She expressed serious concerns about competing and where Commission's
13 priorities rested. She understood that the redevelopment funds were to revitalize
14 downtown. She thought this particular project could be successful standing
15 alone. She agreed with other Commissioners that a personal guarantee should
16 be required. She thought it possible that the $130/$140 a night may not be
17 reached by the hotel at the Marina and that it may not cap out if there is another
18 120 -room hotel in the area. She asked for examples of similar developments that
19 have been successful.
20
21 Mr. Kelly responded that the Fairmont Hotel in San Jose was a classic example,
22 as was the DoubleTree in Monterey.
23
24 Vice Chair Torliatt inquired if the respective cities were involved at the same
25 level.
26
27 Mr. Kelly responded that in San Jose it was greater, but it was a more expensive
28 property.
29
30 Vice Chair Torliatt noted he was talking about major cities with 750,000 people.
31
32 Mr. Kelly agreed. Santa Rosa was putting in $6 million to do that plus the land for
33 a hotel in the Railroad Square area. Larger cities are putting in more hard dollars
34 up front.
35
36 Vice Chair Torliatt concluded that she was concerned about using the City
37 money fairly.
38
39 Commissioner Maguire summarized that redevelopment agencies are built to
40 share some risks. Yes, public monies are used to reach maximum public benefit.
41 In this case, it was not a huge risk. The $750,000 in improvements was the
42 biggest risk. He thought a personal guarantee would be going too far and would
43 like to direct staff to look at security on another property. Maybe a revised
44 schedule of payback could be found. He suggested it should come back in two
45 weeks for final action.
46
Vol. , Page 12 May 1, 2000
1 Commissioner Hamilton thought there was enough public benefit in this project to
2 merit investment by the City. There was no debt risk and perhaps a safety clause
3 to provide more assurances.
4
5 Commissioner Keller agreed to bring it back in two weeks, and if there were a
6 way to arrange a better security position for the City in terms of payback, to move
7 ahead.
8
9 NEW BUSINESS (continued from afternoon session)
10
11 1. Review of FY 2000/2001 Affordable Housing Program and Budget
12
13 a. Resolution Approving the Housing Budget for Inclusion in the FY 2000/2001
14 Non -Housing budget.
15 b. Resolution Approving the Neighborhood Revitalization Program Portion of the
16 FY 2000/2001 Housing Program and Budget*
17
18 *This item was separated into two items so that Commissioner Maguire could
19 recuse himself from the Neighborhood Revitalization Program portion due to a
20 conflict of interest.
21
22 Housing Administrator Bonne Gaebler noted that the Commission had questions
23 in the afternoon session about the market rate vs. affordable portions of Eden
24 Housing's proposed rental workforce housing, the Downtown River Apartments.
25 This project, an 81 -apartment community of one-, two-, and three-bedroom
26 apartments, is designed as three floors over parking. There is a public area over
27 the river walkway, childcare, and mixed use along Washington Street.
28
29 At the budget meeting last year, several representatives of the Petaluma
30 Downtown Association requested that this affordable community include a
31 percentage of market -rate apartments, unlike similar properties, which are 100%
32 affordable. Eden is currently proposed as work force housing. The mix of typical
33 renters might include those earning minimum wage; single -parent clerical, white -
34 collar professionals with a stay-at-home spouse. Eden proposed eight
35 apartments for persons earning minimum wage; sixteen for a family of three or
36 four earning $25,000-$30,000, and the remaining four two- and three-bedroom
37 units for individuals earning about $32,000. The sixteen units are the 20% market
38 rate units that Eden is proposing. These would have no maximum limit and no
39 restrictions on them.
40
41 The mix of units was shared with the PDA, but after further discussion, PDA is
42 requesting that the mix be adjusted 80% market rate and 20% affordable. The
43 funding was allocated last year, so this is not a money issue. Land use
44 approvals would not be given at this meeting, so no defined decision would need
45 to be made. Eden is in no rush to do that. There is time to work out this project.
May 1, 2000 Vol. , Page 13
1 Eden and the housing staff will continue to work with all the parties interested in
2 it.
4 Commissioner Healy shared a discussion he had with Ms. Gaebler and he
5 believed that it presented some complex issues and more discussions would be
6 needed. He suggested the budget be approved at this meeting.
7
8 PUBLIC COMMENT
9
10 Executive Director Samantha Daugherty, Petaluma Downtown Association,
11 explained that approximately a year ago, their board president spoke with the
12 Commission regarding this issue. While the PDA agrees that more affordable
13 housing is needed throughout Petaluma, their concern is with the low percentage
14 of market rate rentals that Eden would be including in this rental community.
15 PDA has no problems with the budget. The PDA requests that the ratios be
16 reconsidered and include more market rate.
17
18 Commissioner Maguire asked how the PDA came up with 80%.
19
20 Ms. Daugherty answered that PDA would really like to see 80%. They
21 understand that for a non-profit organization such as Eden, 80% is unrealistic. In
22 keeping with federal regulations they cannot go higher than 20%.
23
24 Commissioner Maguire again asked how the PDA arrived at 80%.
25
26 Ms. Daugherty advised there was a lack of affordable housing and also that there
27 is a real concern with market rate. Looking at the current low income and
28 affordable housing developments throughout Petaluma, there are probably fifteen
29 out of thirty-one developments in the downtown area that are below market.
30 Their concern is that the City is looking at placing a community that would be
31 centrally located downtown and PDA feels that the downtown would be more
32 benefited by including 80% market rate.
33
34 Commissioner Maguire asked if the PDA considered the socio-demographcs and
35 people's ability to pay rent. He again asked why the PDA used the 80% amount.
36
37 Ms. Daugherty said that they are somewhat flexible, but very concerned with only
38 20% market rate. The PDA believes that by including more market rate, the
39 downtown business economy would be more viable. People would be brought in
40 and put in dollars to the community.
41
42 Commissioner Cader-Thompson asked that the PDA think about what they are
43 really saying. She thought this was discrimination and did not reflect well on the
44 community.
45
46 Commissioner Maguire agreed.
Vol. Page 14
May 1, 2000
2 Commissioner Healy thought the previous comments were unfair.
3
4 Commissioner Hamilton requested that the discussion be tabled.
5
6 Ms. Daugherty stated she was asking the Commission to look at where the other
7 developments are, at where the majority of affordable housing was being built.
9 Diane Reilly -Torres, Rainier Avenue, thought that the City had violated the law by
10 not having hearings regarding this matter. She requested help from Ms. Gaebler.
11
12 Ms. Gaebler advised that it was not the Housing Program; it was the
13 consolidated plan. The City makes a decision on that and the allocations are
14 published in the newspaper for 30 days. Staff takes any comments and reports
15 them to HUD.
16
17 Ms. Reilly -Torres shared her ideas that there really was not an opportunity for the
18 public here. She spoke regarding the homeless and shelterless in Petaluma who
19 had nowhere to eat and no place to sleep. She asked how much money was
20 needed to care for these people.
21
22 Vice Chair Torliatt advised that they did hear this agenda item that afternoon and
23 Ms. Gaebler gave a presentation, but did not have a full Commission to make a
24 decision.
25
26 Bryant Moynihan, 102 Dawn Place, spoke regarding his concern that the PCDC
27 budget would be viewed piecemeal instead of comprehensively. He did not think
28 that was appropriate. Last fiscal year, the Redevelopment Agency's housing
29 funds were borrowed and spent on projects, $2.5 million, and were not repaid
30 until the incremental property taxes were received last December. Based on this
31 current budget, the City does not have any funds for this at this point and will
32 have to borrow the housing funds again this year. He thought the Commission
33 needed to look at it comprehensively.
34
35 Geoff Cartwright, 56 Rocca Drive, asked if the project was going to be built in the
36 floodplain.
37
38 Vice Chair Torliatt commented that they needed to look at the needs of the
39 different neighborhoods and address that issue mid-term.
40
41 Ms. Gaebler advised she would be happy to develop and implement a
42 community -wide look at all of the neighborhoods.
43
44 Mr. Rudnansky explained that the reason Commissioner Maguire recused
45 himself was that he owns a residence in the area that may be affected by the
46 Community Revitalization Program.
May 1, 2000 Vol. , Page 15
1
2 MOTION: Commissioner Keller moved, seconded by Maguire, to adopt
3 Resolution 00-09 Approving the Housing Budget for Inclusion in
4 the FY 2000/2001 Non -Housing Budget.
5
6 MOTION
7 PASSED: 6/0/1 (Chair Thompson absent)
8
9 MOTION: Commissioner Hamilton moved, seconded by Cader-Thompson, to
10 adopt Resolution 00-10 Approving the Neighborhood
11 Revitalization Program Portion of the FY 2000/2001 Housing
12 Program and Budget.
13
14 MOTION
15 PASSED: 5/0/2 (Commissioner Maguire recused; Chair Thompson absent)
16
17 ADJOURN
18
19 The meeting adjourned at 8:30 P.M.
20
21
22
23
24
25 ATTEST:
26
27
28 Beverly Kline, Recording Secretary
29
30 ******
Pamela Torliatt, Vice Chair