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Agenda and Minutes 2012-12-19 City of Northampton Community Preservation Committee 210 Main Street, City Hall Northampton, MA 01060 Community Preservation Committee DATE: Wednesday, December 19, 2012 TIME: 7:00pm PLACE: City Council Chambers, 212 Main Street (BEHIND City Hall) Contact: Downey Meyer, Chair, Community Preservation Committee downeymeyer@gmail.com Sarah LaValley, Community Preservation Planner slavalley@northamptonma.gov (413) 587-1263 Agenda  General Public Comment  Minutes  November 7, 2012  Chair’s Report Update on Project Recommendations  Next Steps, State Hospital Fountain Recommendation   Request for Expedited Review – Christopher Heights Assisted Living Affordable Housing, City of Northampton Mayor David Narkewicz  Broad Brook Gap Project: Update, Discuss Budget  Review and Approve Draft Contracts for Round 2 2012 CPA Projects  Continue 2012-2014 CPA Plan Update  Adjourn For additional information please refer to the Community Preservation Committee website: http://www.northamptonma.gov/cpc/ Next Meeting: January 2, 2013 Community Preservation Committee Minutes December 19, 2012 Time: 7:00 pm Place: City Council Chambers, 212 Main Street Members Present: Downey Meyer, Brian Adams, Bill Breitbart, David Drake, Marlene Morin, Dave Rothstein, Debin Bruce, Jim Durfer Staff Present: Sarah LaValley Downey called the meeting to order at 7:03 PM. General Public Comment None Minutes - November 7, 2012 Debin moved to approve the minutes, seconded by Bill. The motion carried unanimously. Request for Expedited Review – Christopher Heights Assisted Living Affordable Housing, City of Northampton Mayor David Narkewicz Wayne Feiden, Director of Planning and Development, provided an overview of the project on behalf of the Mayor, who first became aware of that the Hosptital Hill master plan included space for an assisted living facility it as a member of the State Hospital Citizens Advisory Committee. The 83-unit assisted living project has already received necessary permits from the Planning Board, and the goal is for half of the units to be affordable, with 17 restricted to those earning 30% of area median income (AMI) or less, and 26 to 60% AMI. Forty units will be unrestricted, but are still likely to be available for low or moderate income seniors. The developer approached the City regarding the possibility of Tax Increment Financing (TIF) for the project. In a TIF, pre-development taxes are compared with taxes following development of a property, and the developer is not assessed a portion of the difference. Village Hill is tax- exempt, so any increase would be eligible. Here, the City proposes to would grant the developer a 15-year, 25% tax abatement, totaling $150,000. The City would absorb $30,000 of the lost tax revenue (5%), and asks that the CPC reimburse the City general fund the remaining $120,000 in additional taxes that would not be collected. Bill pointed out that the CPA is not being asked to fund project costs, as with a typical CPA project. Dave expressed concern that the request for expedited review listed the Mayor’s Office as the applicant, and asked why the developer did not directly request the funds, which is the norm. Wayne replied that the developer was interested in the TIF, and but that the City would need CPA funds to make a 25% TIF feasible. Wayne noted that this would be the lowest per-unit subsidy of CPA housing project to-date. It is being submitted for expedited review because the state tax credit application has been submitted, and the State funding agency inquired whether the applicant had received a commitment for a local match. Given that the state was expected to make a decision by the second or third week of January 2013, the applicant approached the City to inquire about TIF, which could serve as match. Dave expressed concern about the tax implications for residents who had already been assessed CPC fees, and would also be asked to reimburse the City general fund for additional lost tax revenues. He noted that the state match for affordable housing tax credits typically involve the CPC granting matching funds directly to the developer for construction or operational costs. Bill noted that the project has been submitted for the current round of low-income housing tax credits (LIHTC) and asked if the Department of Housing and Community Development (DHCD) DHCD requested the local match. Wayne replied that they did, and that the Mayor indicated that he is requesting through the CPA. Bill provided an overview of the LIHTC program, noting that it is generally not sufficient to cover project costs, and the TIF and CPA would help to fill that gap. Northampton Community Preservation Committee Minutes 1 December 19, 2012 Dave noted that it is unusual for the City to be an applicant on behalf of a developer. Wayne replied that the City and DHCD, will be granted a 30-year deed restriction, which will be a benefit to the City. Additionally, the initial request is only for permission to submit an expedited application, and the developer could possibly be involved in the application if the request is approved. Dave reminded the committee that the TIF is in no way essential vehicle to secure the affordable housing restriction. He noted that the CPC had in the past directly conditioned affordable housing grants on DHCD-approved restrictions, and that none had involved TIFs. Jim asked if Northampton residents will receive priority placement. Wayne stated that those interested in the facility would most likely have ties to the community, but would be decided by lottery. David asked about potential profit to be made by tax credit investors. Wayne stated that that type of investment typically does not have a large profit margin, but that developers’ pro forma are not typically reviewed. Bill added that the developer will see a small return, but this is part of the allowable pro forma, and the project would be infeasible otherwise. Wayne stated that the City has tried to develop affordable assisted living units without success. The CPA cost per unit will also be minimal, compared to other projects. Jim asked whether the project, with the City as the applicant, would take CPA funds and essentially return them to the City’s general fund. Wayne replied that it would not, since the City would not be collecting taxes on the project, Dave stated that he would prefer to award funds directly to the developer. He thought this would be a more transparent means to facilitate a potentially worthy project without muddling the role of applicants and tax policy. Downey suggested that the developer be asked whether there is an amount that would be needed if CPA funds were not used to contribute to the TIF. The Committee discussed the proposed federal share of the project; approximately four million. The Committee considered criteria for expedited applications, noting that a CPA commitment is required for the LIHTC application that has already been submitted, that disbursement will be needed for the project to break ground, and that assisted affordable units are a needed housing type. Brian moved to allow expedited review of the Christopher Heights application. Seconded by Bill, the motion carried6-1. The Committee discussed timing and application requirements. The application will be due to December 28, to be discussed at the January 2 meeting. The Committee asked that the application include additional involvement from the applicant, if possible, a structure with CPA funds going directly to the applicant, a copy of the LIHTC application, the tenant selection plan, and a list of outstanding permits required. Broad Brook Gap Project: Update, Discuss Budget Wayne informed the Committee that the LAND grant for the project has been received, which has also leveraged a fundraising campaign. Closing should occur in late winter. A ‘stump dump’ was found on the Gap parcel as part of due diligence, and was approximately 4 acres were removed from the acquisition boundary so the owners could retain it. Because less acreage would be acquired, the price decreased and created a surplus of funds. Wayne indicated that in such a circumstance the applicant would normally not use all the requested funds (or return the excess). But in this case, he was concerned about relationships between the Broad Brook Coalition and private parties from whom donations were solicited, should the CPC funds be returned. He asked instead that excess funds be used to pursue adjacent Broad Brook gap parcels. To support this approach, he noted that in the Open Space Plan, the ‘Broad Brook Gap’ area includes not just the parcel to be acquired, but other adjacent or nearby unprotected parcels. Dave stated that while purchase of the parcels might makes sense, allowing it with current project funds seems unfair since the original application presented one specific parcel, not any of the others discussed in the Open Space Plan. He felt that reassigning the funds for acquisition of other parcels was imprudent as well as unfair to other applicants. He also noted that the original application provided details on the natural resource and open space values that helped inform whether that particular project was worthwhile and consistent with the CPC’s funding criteria. No such information would b available to support the acquisition of any of Northampton Community Preservation Committee Minutes 2 December 19, 2012 the other parcels mentioned. He was concerned that bypassing the application process would eliminate the opportunity to discuss access, land use and the views of neighboring landowners for the originally proposed parcel. He also stated that the applicant could always come back to the CPC for expedited processing if immediate funding was needed, or avail its self of the newly recapitalized Conservation Fund for soft costs for such purchases. Downey noted that both the recommendation and resolution said ‘up to’ 87 acres, and not allowing the purchase would be prohibiting purchase of adjacent land at a lower cost. Jim moved to approve the request to use funds for additional parcels under the existing CPA award, but that a written request be provided for the file. Seconded by Brian, the motion carried 5-1, with 1 abstention. Chair’s Report Downey informed the Committee that Round 2 funding recommendations were approved by Council at first reading, with the exception of the State Hospital Fountain project, which was tabled. Councilors expressed concern about the fountain’s location, the amount of leveraging proposed, and limited private sector involvement. The Committee discussed a plan for the next Council meeting; Downey and project applicants and supporters will plan to attend. Debin suggested that additional information about the CPC review process may be helpful. Sarah noted that Council has had questions about the recommendation process in the past, but in this case concerns were based on the project. Review and Approve Draft Contracts for Round 2 2012 CPA Projects The Committee reviewed draft contracts and MOU, adding specific conditions for public comment for the CT River Greenway, and photo documentation for the Fitzgerald Lake Invasives project. Due to the lateness of hour, the Committee agreed to review and approve the contracts and MOU as the first agenda item at the next meeting. Other Business Not Foreseen When Agenda Was Published None Adjourn On a motion and second, with unanimous vote, the meeting was adjourned at 9:10 PM Northampton Community Preservation Committee Minutes 3 December 19, 2012