Committee Minutes

MINUTES/URBAN DEVELOPMENT COMMITTEE
Saturday, January 7, 1995 - 1:30 p.m.

Members present: Beach, Glassheim, Hanson.

1. Authorization to award bids for demo of 409 Walnut Street.
John O'Leary presented matter and stated they need motion to proceed with solicitation of bids.

Sally Morris and Clyde Morris were present. Mrs. Morris stated they have had long standing interest in this property and have discussed purchasing property from Mrs. Hariman, talked to her about leasing, etc. to do improvements and to manage property, however she indicated that she no longer had control of the property because was unable to pay notes, and was in the hands of the RTC and had been sold to Urban Development by purchase through use of CDBG funds. She stated they would like to get estimates for rehab. of the property and make feasible for high quality single family housing and would be asset to the com- munity. She stated there was no benefit to the community in tearing building down, feels it's not in the public interest to tear down, that there's shortage of this kind of housing in Grand Forks and asked that there be a time period within which to bring up to HUD standards.

John O'Leary reported house acquired from RTC, along with property at 1702 Dyke Avenue, which has been remodeled and is being rented. He reported they consulted with building inspector, planner, and Historical Society; that house inspected to see whether worth remodeling, and distributed copies of letters from Historical Society, inspection and planning departments and reviewed letters. He also reported that Curt Siewert inspected house and distributed copies of itemized listing of required work, est. cost $31,000, to open doors and get someone in it; thinks it's beyond repair and is on a non-conforming lot, removal of house would be benefit to the neighborhood.

Mr. O'Leary stated this is never going to be owner-occupied house, difficult to sell this house because of lot size (50'x50'), no backyard, illegal to build on this size lot, no parking, and has some questions re. rehabbing of this property, if spend more than 2/3rds of the value, can't rehab. and if sold would have to be put out on bids. He stated other options - that other non-profits may want to look at property (Adult Abuse, Salvation Army, etc.); or either property owner abutting would probably be interested in purchasing. Clyde Morris stated that vacant lot not of interest to purchase, expose back yard of adjacent house to the street, and church not interested in property without the house.

Tom Kuchera, attorney, stated he is interested in the possible development in this area of a historical district, there are a number of buildings, homes, public edifices in the area already

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on the Historical Register. He stated this house not one of the great houses of Grand Forks but was concerned because he saw a statement made to the State Historical Society in connection with the review process for areas of this kind and older buildings of this kind, in which there was a false statement to the effect that this was not a house more than 50 years old, and didn't know if that had been corrected, but that it would be improper to proceed until it's clear that record has been correctly made. Mr. O'Leary reported that was a typographical error and has talked to the State re. this. The committee noted that this structure is over 50 years old.

Mr. Kuchera stated that the Morris' are abutters to this property, and should be given consideration, that there has not been much public process here, and that there is an opinion that the property could be made habitable, perhaps it should be; and a reasonable opportunity to all those who might be eligible to acquire be provided, and some arrangement that anyone who took the property did so under something like contract for deed which would require that they get the property into some kind of minimally acceptable shape within a reasonable time. He also stated that it seems in these circumstances in authorizing the expenditure of a significant amount of money for demolition is premature.

After further discussion it was moved by Hanson and Glassheim to hold this matter for 2 weeks for opinion on what Land Development Code says re. this property (ie., is it legal to put twice value of house into non-conforming house that's been vacant for more than a year) and to give Morris' opportunity to get estimates for repair of the property. Motion carried. (committee only)

2. Review of jobs development authority code.
Mr. O'Leary distributed copies of a proposed ordinance creating a Jobs Development Authority, and stated that the JDA (Jobs Development Authority) is a vehicle established by the legislature to promote economic development in cities and counties; when Growth Fund was established in 1970 the rules and regulations for the Growth Fund were not incorporated into the municipal code, and Howard Swanson, city attorney, thinks it's time to do something more formal. He reported that in recent years City has seen fit to take an equity position in companies, and under ND State Constitution, you can't do that, so the way they proceeded with it was to turn equity position over to the Grand Forks Regional Economic Development Corp. who holds our position; that for a lot of reasons it makes sense to take an equity position in companies that have great growth, if we are taking risk with these companies, then we should benefit in profits as well. He stated that Mr. Swanson thinks best way to do this is through a JDA and is recommending that the City use the council as the Jobs Development Authority. Mr. O'Leary

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reviewed proposed ordinance with the committee. He noted that council would be JDA and would appoint a sub-committee composed of same members who are on the Growth Fund Committee to serve in an advisory capacity.

There was some discussion re. notice requirements. Dick Olson of the GF Development Corporation, expressed concern re. notice requirements - whether 5-day notice could be waived because of timing in acting on applications, etc. It was noted that the legislature doesn't mandate what adequate public notice is for a public hearing that's just a public meeting. Mr. O'Leary suggested including only first sentence which is what we do now (Prior to final action by the Authority on any proposal a public hearing shall be conducted.) and to delete time requirements. Committee suggested cutting time to 3 days. After further discussion it was suggested including provision that the JDA may waive the notice requirements by 2/3rds vote of members present.
After review of the ordinance, the committee suggested that under Powers and Duties, item 1. To sue and be sued. be moved to Item 14.

Moved by Glassheim and Hanson to approve with editorial changes, and to introduce ordinance for first reading. Motion carried.

Hanson excused.

3. Discussion of HOME application for 1995.
Mr. O'Leary reported that each year City gets between $400-500,000 from HUD under HOME regs. to improve housing stock within the city, that the application procedure is long and arduous one, and distributed copies of proposal for Home Program Funds and reviewed proposal with committee:

1) Use of HOME funds in the past two years:
Last year the City used $938,650 to construct 11 houses in Burdick's Subdivision, and also $30,000 to rehab. transitional house on North 3rd Street.
2) HOME funds available to Grand Forks:
$457,000 for this year.
3) Eligible uses of HOME Funds:
Sue Redman reported that the HOME program is program to provide housing for low income families, rental projects, either rehab or new construction, and home ownership project, have to be low families and have to have match of 25% locally.
4) Match requirements:
It was noted that match has to be local, state, private, or non-profit funds. Mr. O'Leary reported biggest problem is to come up with match, which isn't from ineligible sources, can't use CDBG funds, homeowner equity; has to be from municipal government basically or from some non-profit who don't have any
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money.
5) Proposals:
Mr. O'Leary reported that staff is making two recommendations:
A. Homeownership assistance - $230,000 for 7 houses in Burdick's Subdivision; and In-fill housing - 3 houses on scattered sites. He distributed copies of plans received from Fargo for modest houses and other plans he had received. He stated that houses would be built by the Housing Authority using off-shelf blueprints and sold to low income families using conventional or first-time home buyer programs to finance and HOME funds to subsidize the cost to make them affordable. He reported HOME regs. mandate recapture of these funds upon resale for the life of the loan so would be necessary to put deed restrictions on the houses; and reviewed conditions to be placed on homeownership assistance. He reported there are 39 lots left in Burdick's Subdivision and they are proposing to use HOME funds to subsidize 7 houses at approx. $75,000 (and noted that cost for the 11 houses built was higher because 4-5 bedroom houses), and proposing to come up with match through ND HFA first time home buyer loan and tax exemption for 10 years under urban renewal plan.
B. Rehab. of Continental Homes - $227,000
He reported that $227,000 would be used to rehab Continental Homes, that there's $100,000 in reserve account which they would use for the project as well. (Rehab. items would include window replacement, siding, insulation, heating update, replacement of water heaters, etc.)

There was some discussion re. houses constructed in Burdick's Subdivision, public comments, etc. The committee suggested keeping cost of these houses as low as possible (through size, or elimination of garage, etc.)

It was noted that match could come through donated labor and materials but not by homeowner, and as long as documented.

Moved by Glassheim and Beach that we request staff to prepare HOME application with appropriate editorial remarks. Motion carried. (committee only)

It was noted that formal proposal will come back to committee before it goes to council for approval.

Meeting adjourned.

Alice Fontaine
City Clerk

Dated: January 9, 1995.