Committee Minutes

MINUTES/URBAN DEVELOPMENT COMMITTEE
Wednesday, March 13, 1996 - 4:00 p.m.

Members present: Glassheim, Hanson

1. Matter of closing out individual CDBG project balances.
Terry Hanson reported they have a number of projects that have minimal balances, and want to close out and transfer remaining funds to unprogrammed account. He reported that $77,000.77 in unexpended admin. funds is largest amount and is due to short year (change in fiscal year). He noted that projects completed and funds were specifically allocated for that particular project (bricks and mortar projects); he reported that Sr. Citizens funds were for parking lot which has been completed, that they allocated $20,000 and only used $16,000+)

Moved by Hanson and Glassheim that the following remaining balances be transferred to Unprogrammed Funds:
GFCSS Family Connections $ 295.98
Abuse and Rape Crisis 406.23
Centre, Inc. 5.67
Senior Citizens Center 3,393.13 Berg Building 9.50
Adult Abuse Bldg. 66.72
Adult Abuse Bldg. 20.00
Unexpended Admin. funds 77,000.77
Total $81,198.00

2. Matter of vacation of utility easement in Burdick's Resub.
Curt Siewert reported they went to Planning & Zoning to re-replat, and subdivided 10 lots into 12, and 6 lots into 7; that Planning and Zoning gave preliminary approval, however, they need to vacate part of the easement to complete replatting of lots - would move easement to the east 4.7 ft. and there is nothing in the easement. Moved by Hanson and Glassheim to approve petition for vacation of the Erly. 4.7 ft of the 20 ft. north/south side- walk and utility easement in Lots 17 and 18, Block 2, Burdick's Resubdivision and authorize proper City officials to sign said petition on behalf of the City of Grand Forks, and to refer the petition to the Planning and Zoning Commission. Motion carried.

3. Matter of housing project in Burdick's Resubdivision.
Mr. O'Leary reported that Habitat for Humanity has requested two lots; that they have selected architect, Kent Anderson, on hourly basis, for the design of houses that would be sold to low and moderate income families in Burdick's Resub. He stated that with this replat will have in excess of 40 lots which are undeveloped, improved lots but without structures (specials paid). He reported that they have looked at building those houses through City and some other alternates. He reported the major problems with developing the lots through City: 1) there needs to be architect, however, need services of professional to help with process, but not an architect at 7% of construction cost, probably do some inspection during construction according MINUTES/URBAN DEVELOPMENT COMMITTEE
March 13, 1996 - Page 2

to specs.; 2) that contractors, regardless of size, would be required to be bonded; most construction projects across city are not bonded, and only advantage is that it does provide builder some protection, but does add cost to the house; and 3) have to bid both ways, as both general and prime contractor. He stated it has to be bid as general, mechanical and electrical, and under the general contractor, they could be assigned the duties of coordinating the work; that could be problem for the general, as City would be selecting the other two contractors, and general contractor has to coordinate with subs he hasn't picked. He reported that staff has concluded that better way to do is to have non-profit build and sell the houses. He stated that between now and next meeting they will have formalized request coming to committee from Grand Forks Homes for 7 lots to construct 7 new single-family houses in Burdick's Resubdivision. He stated that there are some conditions that the City might want to put on, if they approve. He stated that City would be assigning 7 lots worth between $15-20,000 each to a non-profit; that revenues from sale of lots would be set aside for the development of other land which would be dedicated for the development of low and moderate income housing. He stated that if they sell all 40 of those lots, that $600-800,000 would eventually be put into a pool where could develop another 20 acres for modestly priced houses. He stated that whether they want to look at other options - selling to private developers for affordable housing or develop themselves; that a condition they might want to consider is that the revenues that Grand Forks Homes would realize would be set aside for that purpose. He stated they might also want to put time frame on this for development within reasonable period of time. He stated there is another advantage to do with Grand Forks Homes, which is a collection of churches, and they have committed themselves for the last 20 years to the development of afford- able housing and have good track record. He stated that the reason they need the lots is that Grand Forks Homes would have to do what the City would do, and that is borrow the money, and it would be their proposal that the lots would not have any condi- tions or covenants so they could take the lots to the bank and use as collateral to borrow money for construction loan. However, once the buildings on the lots are completed, the money would be put into an escrow account for the development of other land.

Mr. O'Leary presented two house plans, one they bought and one LumberMart developed for them, one is design Habitat will be using for the construction of their houses in this subdivision, and reviewed with the committee. He stated that water table is high in this area, and both designs are split level, with lower level only in ground few feet. He noted that houses have less than 1,000 sq.ft.; that roof lines may be little lower than existing houses, but that these houses would blend in with
existing houses.
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Mr. O'Leary reported that it's their intention to focus market on lower/middle income families, and have Home Grant that would come in afterwards and help those families with the down payment, the families would have to afford the house payment. He also stated that it is not their recommendation to use real estate agent to sell these houses. Grand Forks Homes would carry paper, borrow money and market them; Grand Forks Homes would also bid houses. He stated that the biggest advantage to have Grand Forks Homes do this, is that they would have only one contractor that would build l, 2 or 3 houses. He stated that the lot price included in the price of the houses, and should be setting aside funds for landscaping design; that they did put lot of pines in the back of these lots for screening from I-29. He also stated that houses could be sold on general market. He stated that the committee will have to consider how to structure program of assistance to first time home owners, how market and how do write-downs, etc.
He reported that the buyer will have option to apply for two-year tax exemption, and then property will be on tax rolls.
Info. only. Held for 2 weeks.

Meeting adjourned at 5:00 p.m.

Alice Fontaine
City Clerk

Dated: 03/14/96.