Committee Minutes

Minutes/Finance-Development Committee
Thursday, July 13, 2006 - 5:00 p.m.______

The Finance/Development Standby Committee met on Thursday, July 13, 2006 at 5:00 p.m. in Room A101 in City Hall. Council Member Glassheim presiding. Present were Glassheim, Christensen, Gershman.

Others present included: Greg Hoover, Connie Mangan, Pat Berger.

1. 2007 Community Development Block Grant Program (CDBG) proposed program and schedule._________________________________________________________
Greg Hoover, urban development, stated they were not proposing changes from last
year's process if the committee concurs, they would forward this for the council to approve the
process, and recommend approval of the citizen's advisory committee to review the Bricks and
Mortar application, for the United Way to administer the public service funds; that they anticipate
a little over $1.5 million next year with a little over $425,000 from their entitlement and the
balance from program income, that would leave them with about $200,000 for public services,
$306,000 for administration, and balance of little over $1 million for Bricks and Mortar, and
standard federal regulations they have to go through and would ask returning council to either re-
appoint their person or appoint a new one ASAP so can get this going and that they will contact
Mr. Bakken and Mr. McNamara for their names and get those in place if the committee
recommends and the council approves the use of the advisory committee.

He stated that they have discussed the City taking over the administration of the public services
and focusing on a couple of big projects, however, given some of their staffing changes and
should have had this discussion much sooner, that he would recommend to go with United
Way as administrator and if the committee and/or council wishes to explore that option further,
can do that but given the timeline under which they have to operate, thinks it would be difficult to
meet those deadlines and have a very thoughtful discussion. He stated that they will have more
information on this, but recall that they set up the revolving loan rehab. program through Red
River Valley Community Action Agency and they received $300,000 this year and some concern
by them that this wouldn't take off, they have, even before they got the program officially off the
ground, had a lot of applicants and have nearly half of the money already committed this year and
will get it all committed this year and therefore we will ask for a like amount for 2007 and recall
that this was one of the things you wanted to do for two purposes: 1) focus on a neighborhood to
revitalize it, and 2) to revolve some of our money back into a revolving loan account for other
housing. He stated it is a large area and he hasn't got a report on where the commitments are, but
the area is from 13th or 17th Avenue South to the northern city limits and from the River to
Columbia Road; and part of the reason they agreed to go with that large area is that they didn't
know how successful this would be and thought they would need to come in and have as large an
area as possible so could make sure it was a success, but will get a report from them as to location
and in addition will discuss with them narrowing their focus to a smaller neighborhood in the near
northend probably. Gershman stated it might be more interesting to make the area smaller so can
actually see what is going on. Hoover stated that driving that is a local bank wishes to provide
money to match that program, they haven’t invited applications but they want to do that. Hoover
stated what they would recommend is take $300,000 out of the $1 million plus for Bricks and
Mortar and would bring that down to $725,000.

Christensen stated that a while back they received some projections as to the CDBG Program
income and asked for an update on that, and asked what thoughts were about bigger projects.
Hoover stated that was for the public service money, and probably be an opportune time for Pat
Berger to say how they distributed the money.

Ms. Berger reviewed the Fact Sheet on 2006 Health and Human Service Information Social
Impact, $180,000, that for the past couple years up to 2006 they had been splitting CDBG dollars
and in 2005 had 19 projects, that when reviewed with Mr. Hoover wanted to focus in and bring
that down; and initially had 4 focus areas that they deal with: Children; Seniors; General for the
families (counseling programs; and Basic Needs (food shelves, missions, etc.) and reviewed the
2006 CDBG Awards.

She reviewed several of the programs and the activities they provide: That Red River Valley
Community Action has 2, C.U.P. Fund, $14,000, and that CUP stands for churches, united in
partnership, 30 or so involved in this program and they contribute to the fund, which is used for
emergency needs. Emergency Child Care is a program that provides assistance for childcare
to families in emergency situation - to licensed home providers as well as licensed facilities, use
Red River Valley Community Action to do the casework and they are reviewing the cases. CUP
served 140 families last year; Emergency Child Care grants went to 62 families. That School
Dist. stated 31% of the children in Grand Forks are on free or reduced lunch programs, that Keith
Berger, County Social Services stated up to 1700 families in our community are on some form of
assistance program, most of that is food stamps.

Continue with Care Collaborative has 5 agencies that are involved in this and trying to work
with families on education programs, as some families don't understand budgeting and number of
those are hitting that deadline where they will no longer be available for some of these programs,
based on number of children, family income, etc. and are trying to get more people to be self
reliant.

There was some discussion if the city council would take the Bricks and Mortar money and target
it to some big project like housing for the next 3 years, could do some rehab rather than divvy that
up to agencies; that there are 14 to 20 offices in this town, and to use for people sitting in homes
that need rehab (windows, doors, etc.) instead of funding office space.

Bricks and Mortar funding in 2006: $140,000 to Prairie Harvest Human Services Center
and construction of new home for Youth Foster Care - Shelter for Homeless, $170,000 for Phase
III of capital improvements plan; Senior Citizens, roof repair for $43,000, and Red River Valley
housing rehab program, $400,000; Easter Seals/Good Will program where purchase homes and
rehab and sell homes to LMI people, $60,000; and Gateway Drive slum and blight program (have
two buildings submitted for demolition - Weekley's and Transport building next to it). It was
noted they also have a HUD funded program - Home Program and that is where funded American
Dream, $340,000 and also under that program, Red River Valley Habitat for Humanities.

Ms. Berger stated that society as a whole cannot keep supporting all these individual things, that
last year there were requests of $389,000 for the $180,000 that was given out, and United Way's
request for general allocations, total amount was $800,000, taking out the $180,000, coming
down to 2 to 1, try to work and get folks to do these things together. Glassheim asked what they
hear from the agencies in terms of their financial liability. Ms. Berger stated there tends to be
cycles, CVIC was big agency everyone was supporting; dollars are harder to get and agencies
need to work together and hear from major funders that come into town (Bremer Foundation,
Knight Foundation) that they want to see them working together to solve the problem for that
client, not giving individually, and there are some concerns. That during the United Way
campaign they cannot go out and do funding for 2 months, gives them a breather, but the rest of
the time they are out there. That sometimes their dollars are 30-40% of an agency's budget
and sometimes down around 5 or 10% and they were able to take these dollars and turn into
something else because could leverage it; and looking at their dollars to see how maximize the
most and being effective. Ms. Berger stated they did have a 3 month and cut it down.
Christensen stated it has become an issue among several council persons and may impact the
continuation of your agency being allowed to administer. Ms. Berger stated she would be sorry
to hear that, because if they were to turn around and give these dollars to one particular agency,
that wouldn't be something she would agree to. Christensen stated he is suggesting it isn't the
best policy for United Way; Ms. Berger stated she believes it is and in terms of the agencies
everyone with the exception of one particular agency right now is abiding by the rules, you don't
have to be a United Way agency, that if you want to go out and raise your own money, go ahead.

Christensen asked what do they do with the $306,000 for administration, if that is thrown into the
budget, and that on the housing issue, if they thought about putting a large amount with the
Housing Authority as long as made sure it didn't go to their administration; they have the low
income housing projects. Mr. Hoover stated their expectation is that they would use that money
but doesn't revolve back, and what kind of balance do they want to strive for; that HUD has
pushed over last 6 years or so on performance measures, and what he would rather see is to figure
out beginning for the 2008 year where we want to concentrate using money, make decisions of
perhaps putting so much into revolving loan fund, know that the Housing Authority couldn't do
the Promenade projects without federal funding, put some in there, and do we want to encourage
some of the developers to put in some lower income housing in their developments and give them
low interest loan.

Christensen asked if we would have time between now and next year to say we're going to hold
back some of this money and try to do what you are saying for the summer of 2007, and if doesn't
work, then have a reallocation process. Mr. Hoover stated they did that with the money they used
downtown and found out they couldn't.

Glassheim stated that the agencies that work in the community need help and want them
surviving, but questioning whether there should be a citizens' advisory committee because if we
say there are going to be 3 projects, then maybe don't need a citizens advisory committee and that
is the issue before us today, every year people making proposals and are heard by committee
and staff and that is a measure of what the community needs or wants, but doesn't have any
objections to say that our primary goal is housing, and 70% of our money is going to go for
housing

Ms. Berger stated that last year they sat down with all of their agencies and the four focus groups,
and asked what the most important problems facing your clients and where can United Way
dollars have an impact, one thing they couldn't have an impact on was housing as didn't have
enough money; but there are some programs that can go with housing that have to do with the
education and helping people get in there, how to save, how to run a budget.

Gershman stated that several years ago he had suggested having a home fair, that federal
agencies, FHA, have plan on how to do this and rather than teaching few people to get together ,
put on a housing fair at Alerus where people can learn about mortgages, etc. and get some
counseling - but need something more dramatic to bring people in, should do a home fair - Ms.
Berger stated that there is a problem getting people to such an event.

Gershman stated he would hope that sometime in September to have a meeting with all those
agencies and wants to give the same message as he did 6 years ago - come together because if
you don't start coming together, his support won't be; that there is not enough money and the
people that need the help aren't getting it because everybody wants their own office, secretary,
etc. and time for that to start to break down. Ms. Berger stated they got away from a lot of that
right after the flood and unfortunately seeing us reverting back. Gershman suggested that they
have a meeting in September and time for that to stop. .

Mr. Hoover stated that all have to be working together, and that is why want Red River to do the
loan program, that we have the capacity to manage the loan portfolio but doesn't want to go out
and replicate what they are doing, there is a vision he has for our housing efforts - that we know
where the population is, potential for homeowners and provide them home ownership classes, get
them into self-sufficiency program through the Housing Authority where they actually set up a
family budget, set aside money that goes into escrow account, etc. and then the Housing
Authority has a ready made clientele to buy their Promenade homes and that is the way it should
be working. He stated problem is how people find out about it; and that the committee make a
recommendation that we want public service people to begin to cooperate and reduce administra-
tive costs so we get more dollars to the client. Christensen and Glassheim moved that and voted
for the recommendation. Mr. Hoover stated he would make the same recommendation for the
housing providers, and stated he would began to make their focus primarily on housing. Motion
by Christensen and Glassheim to (1) approve the 2007 CDBG Process to the city council; (2)
Approve the Citizens Advisory Committee (CAC) Process for Application Review to the city
council; (3) Approve United Way as the administrator of the 2007 Public Service funds and
convener of a meeting among nonprofits to make recommendations for increasing service
coordination and reducing administrative costs; and (4) Establish affordable housing as a
primary goal of the CDBG program. Motion carried.

There was some discussion relative to purchasing or a non-profit building, for someone to take
the lease in financing it because agencies have money to pay for rent until building paid off and
continue to pay rent so have a revolving fund. It was also noted that there are federal grants that
would help to rehabilitate downtown type buildings, but also noted that wouldn't taker core
downtown but on fringes; and would need to have on public transportation line. Ms. Berger
stated that their board has stated that this time next year they are probably not going to be in their
location, their rent is up and it is not working for them in terms of space and doesn't want to be
going out to a single space but feel that may be where they end up if can't convince people --
Hoover stated the complication of the leases that are up, and it was suggested that they should
look at the Deaconess building because close to Social Services, put some beautification money
around there; Christensen stated that when doing that taking a lot of renters away from private
business. Hoover stated that downtown they are pushing them out because they are anticipating
increased rents.

Glassheim stated as this year progresses, put it back on the agenda and have discussions how it can happen or whether we want it to happen, and that they need to forward to the Committee of the Whole because there are specific recommendations, one is that United Way administer the
public service funds, and Hoover stated that they will put the two motions they made and that will be their recommended actions for the council; and that there be an advisory committee and that each council member appoint one person to it; and approving the schedules which are driven by federal regs.

The meeting adjourned at 6:10 p.m.

Alice Fontaine, City Clerk