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1999.07.06 MAHTF MinutesAFFORDABLE HOUSING TRUST Informal Meeting July 6, 1999 Members Present: Peg Murray, Netti Andersen, Don Bianchi, Mayor Ford, Matt Pitoniak. Also present, John Musante, Finance Director, Cynthia Williams, Mayors Assistant, Peg Keller, Housing Planner. Convening/ The meeting had not been posted so an informal meeting was held rather than a formal one. Peg Murray convened the session at 7:08 p.m. Report from the Mayor/ The Mayor said that the check from Spear Management is expected soon. Diane Andes will contact the Mayor when they receive it from the State. The Mayor plans to assemble the appropriate people for the check presentation. Don stated that this would be a great opportunity for the Mayor to speak to the importance of affordable housing. Review of Fund Contributions Cynthia distributed a list of all the donations received to date. Don commented that it was unconscionable that Fleet had refused to contribute. The Mayor suggested that the Housing Partnership write a letter, as would she, expressing their dissatisfaction. Peg K. said that MACDC and MAHA were currently negotiating the community contribution that should result from the Fleet/BancBoston merger. She will call those organizations. Peg M. will send a list of the hearing dates at which the merger will be discussed before the Federal Reserve Board and the State Board. Peg M. asked if it would be appropriate for Helen Marusek, City Treasurer to be the staff person for the Trust. The Mayor responded no, because she is an elected official and John said it is reasonable to expect her to come periodically and report on the portfolio earnings, etc. The Mayor felt that the staff responsibility should be the same as for the Housing Partnership due to the interrelationship of the issues. Don says he sees the staff person and the treasurer’s roles as separate. Discussion of Trust’s Charge Peg M. stated that she sees the role of the Trust to be more active and require more time than initially described in order to build the fund to last more than 15 years. She said that with affordable housing being one of the major issues facing the City today, the ideal goal would be to build the fund to the extent that it can play a role in the provision of housing. Other members of the Trust expressed different understandings of the role and the time required. The Mayor said she created the Trust in order to have a body of decision makers make Mr. Spear’s $500,000 contribution grow. She then realized that the Housing Partnership had broader goals for such a fund. She saw the fund being drawn down somewhere between the 5th year and the 15th year, with some recapture for increasing the length of time. She is cognizant of the Partnership’s desire to raise money for other projects that might not be Block Grant eligible, such as land banking and direct tenant assistance. She thought that the Partnership would lay out the plans and goals and another group would do the fundraising. The Mayor wants the Partnership to develop a case statement that goes beyond Hampton Gardens. Don queried why the Trustees couldn’t do that, identify projects and be aggressive. The Mayor responded that she feels the Trustees focus is fiduciary and the Partnership’s is goal setting. Peg M. interjected that neither the Trustees or Partnership members understood that they would have to be fundraisers, although she is interested in identifying sources of income to expand the fund. The Mayor mentioned that there is an anonymous donor offering $25,000 in each of two years if it can be matched. The hope is for business community input in lieu of rent control (business community reps had said there were other solutions to preserving and creating affordable housing than the use of rent control during the public hearings held to debate the issue). Mr. Pitoniak said the chances of getting financial contributions from the community after so many other large capital campaigns had just been held, was slim. He also noted that he is not interested in fundraising and was not told that this may be a role of a Trustee. The Mayor agreed to get a paragraph from the anonymous donor about the parameters of his/her gift challenge. Don spoke to the bridge that needs to be made between the business community and housing advocates relative to the need for housing opportunities to be available for workers. Matt agreed, saying he is not sure that is the role of this group, but he sees that issue play itself out daily, people unable to find a place to live. Matt said he sees the role of the Trustees as managing the funds. Peg M. said there need to be funds to manage. The Mayor suggested that different community factions come together at the Partnership, fundraising could be launched from there and overseen by the Trustees. Identifying the needs and assigning dollars could come from the Partnership. Don noted that trusts around the country depend on other sources than donations. He wants the Trust to identify sources. The Mayor said that the push at the State level is for transfer taxes because taxpayer money can only be spent on current operating needs or City capital improvements. The City’s budget is currently so tight that capital improvements can’t all be funded from year to year. She added that the City Council won’t support local option taxes without knowing exactly what they will be spent on. Report on Investment Regulations John reported that under State law, there are limits on how to invest funds. Given the fact that this fund will not be drawn on for 4 to 5 years, presents certain investment vehicle options. One main option in the State Treasurers Money Market Fund which currently earns 4 ¾%. There is a legal list established by the State Banking Commission that describes what vehicles are permissible. John suggested assembling a smaller group to review those vehicles. He said the immediate task is to get the mechanism in place, then he would like it to earn at least 6 3/4% to generate more funds. Peg M. pointed out that on page 11, IB of the agreement with Spear, direct obligations of the Federal government are noted. The Mayor will investigate this. A banking list will be sent to everyone, Matt agreed to meet with John to review it. Don asked about social investments, the Mayor said that beyond government securities and a few blue chips, there may not be many choices. Peg M. said that FNMAE and GNMAE can be targeted directly to low mod activities. Task Summary Matt and John will meet before the next large meeting to review the list the Agreement section noted will be reviewed and analyzed State banking list will be circulated Spear’s check will be received before next meeting is scheduled Peg K. will contact MACDC and MAHA re: Fleet Partnership will write a letter re: Fleet Mayor will talk with donor re: gift challenge Mayor and Wayne will decide on staff support members should bring in ideas to next meeting re: role of the group and how to build the fund Respectfully submitted, Peg Keller