May 11, 2009

General Membership Meetiing 05 - 11

EPIC 5-11-2009 6:30 – 8:30 pm
Holy Rosary Conference Room

Present: Jennie Bjorgo (JB), Linda Leonards (LL), Earl Simms (ES), Brad Pass (BP), Aden Awil (AW), Mary Gonsior (MG), Deb Ekener (DE), Rosie Cruz (RC), Carol Pass (CP),

Guests: Kathy Wetzel-Mastel (KM), Mike Goze (MG), Dean Dovolis (DD), Heidi Quezada (HQ)s
6:50 meeting called to order. Introductions

Approval of Agenda: (BP) Motion to approve agenda passed by consensus.

Approval of Minutes: Motion to approve minutes from April Annual Meeting passed by consensus.

Carol went over some highlights from the Annual Report that was distributed at the Annual Meeting in April. Highlights included improvements in homeownership, replacing lost housing and reducing crime.

Penta Power Poles bill.
Rep. Clark’s bill HF 1993 addresses the toxic emissions that are a result of the utility poles that Xcel Energy and other utilities are using in Minneapolis and elsewhere.

Funding for EPIC programs – see agenda.

East Phillips Park Cultural & Community Center
Dean Dovolis reported that there is a lobbyist in Washington who has volunteered to work the system to see if he can find the $1M needed to support the Dovolis design; will be investigating Federal stimulus funds. EPIC was shut out of the process for several months and has since been able to work with the Park Board to implement a plan that meets the needs as expressed by the EPIC community. Things seem to be going pretty well now, and we are continuing to work to raise the funds to add on to the south end of the building, to add a community room and a full-commercial kitchen.

Public hearing on May 20th is a final endorsement of the EPIC proposed building. Once this meeting goes forward, then the project will proceed to drawing actual building plans.

There is still one plot available.

2931 Bloomington Ave
We have a building that EPIC has been trying to build as part of East Phillips Commons Phase 2 since 2003. This project took a long time, and acquisition of the property was difficult. The developer (Sherman Assoc.) acquired the property and with EPIC set about to proceed with building two Live-Work units in this project. Together, we held many meetings with potential families. Eventually, we found two buyers. After putting down a large deposit, both dropped out. To date, the remaining land has been purchased and two basements are already constructed on the property. A full year was lost just from working with these two buyers. Subsequently, the economy took a downturn. Since then EPIC endorsed using the same design for rental housing instead, given the current downturn in the home owner market and the current need for rental housing in this area.
At this time, EPIC has a city and neighborhood-approved design, the foundation is laid, and Sherman Assoc. will manage the property along with their larger apartment building on the same block. This larger building has had a very positive effect on the area and has remained crime free without police calls. The property can be built using the existing design. However, CM Gary Shiff has recently become opposed to this plan, though it enjoyed his support in the past.

Discussion followed regarding parking issues, now less of a concern,  and the exterior of the design, and conversion from Live-Work to rental.

Heidi, CM Shiffs aide, requested timely notices. Linda apologized for the late notice, however, EPIC is at the mercy of “available” space. The space was found only on short-notice.

Gary does not oppose the plan to change the design from Live-Work, however, Heidi reported that the city attorney is looking into a violation of the contract. Heidi reported that Gary informed the developer of this violation, and explained that if the contract is found to be a violation, and if there is land that was owned by the city, the land would have to go back to the city, and new RFP’s considered. There were differing accounts of this issue. CP stated that this precedent would have to be applied citywide to avoid a charge of unfairness and also that Sherman Assoc. now owns the land and has begun to build. She stated that if there were complaints they should have been lodged before the time and financial investment of the owner of the development site.

Dovolis suggested that perhaps the neighborhood could “amend” the contract.

Rosie reported that since the primary, Gary doesn’t say hi, and hasn’t responded to emails from EPIC. Heidi responded that the staff at Gary’s office responds equally and fairly to all. She stated that because there was a legal issue, she was not able to respond to inquiries about the project. Carol responded that a response of “there’s a legal issue” is at least a response and that she has received no response to several request for information regarding why the sudden opposition. Linda acknowledged that no one present is criticizing Heidi’s work, but mistrust has developed as a result of a lack of timely communication from Gary’s office and the sudden opposition to EPIC’s project without any explanation.

Two arguments: why not cancel a contract when the developer doesn’t meet the contractual agreement, and open the site for an RFP process? Dovolis stated that after sitting through financing meeting over and over with many bankers, and with the current economic climate, a new RFP process is no “silver bullet.”

It was also remarked that city litigation against a developer for failing to complete a project in the allotted time would establish a precedent, which would apply to many developers in the city, and if fairly carried out, would send a chill through city developers.

When did the investigation by the city attorney start? Heidi stated it was unknown.

LL (RC) Motion requesting that EPIC president meet with CM Shiff, Sherman Associates, Dean Dovolis, Rep. Karen Clark, and an EPIC board member for the purpose of working out an amended contract so that this project can move forward. Motion passed. No votes opposed.

Carol noted that the EPIC board passed a motion to recommend that the EPIC neighborhood accept the change to rental on this project. It was noted that the board passed this motion without having the knowledge or explanation of why CM Shiff opposed the project.

LL and RC accepted a late amendment to invite a representative from Midtown to the meeting with CM Shiff.

VIP Project Area - Franklin Station Town Home area
Kathy Wetzel explained the situation and perspective of PRG regarding the VIP Project as follows:
PRG has been working to find a developer to own and operate Phase 1B (rental properties at the corner of 24th and Bloomington Ave.) After the neighborhood declined one group, Common Bond developed a plan and presented it to EPIC in August 2008. After running the numbers again in January, they found that there was a $800,000 gap in their funding. They found that many of their projects had similar gaps, and deciding to focus on their own projects, Common Bond withdrew from the development.

Kathy stated PRG then went out and met with many developers (Sherman Assoc. etc.) Recently, AICDC contacted PRG about the project. PRG shared the history and challenges of the project. Feeling that the AICDC project would be a win-win situation for EPIC and PRG. Kathy believed the project would bring about rental housing consistent with the architectural plans, and the constituency of the project (senior housing) would appeal to the EPIC community. PRG’s investors would receive their funding back (which was spent on architecture, etc. in the process of planning.)

Mike (office in Powderhorn), formerly part of POP, all-nations church, a long-time member of the community. His involvement with AICDC began in June 2008, as CEO/director. The native community has always talked about an “elder housing” unit in the neighborhood. Mike went to the elders and asked if they would support AICDC in developing senior housing. HUD provides about 80% of the cost of building and the maintenance of the housing is also highly funded by HUD. Generally, you need to have a sponsoring agency (often it is a church.) The sponsoring agency partners with a development agency with experience working on (202) buildings. This is not a “money-maker.” AICDC has been looking for land on which to develop this housing. AICDC has met with Common Bond who has a long history of 202 housing experience. Those talks are moving toward a contractual partnership.

AICDC wants to build a 30-unit building on the East side of Bloomington. There is currently no plan for developing the West side of the Bloomington.

Dovolis calls the HUD 202 Elders Housing is a specific program that runs for 40 years. It has a “good, quality, very strictly-managed” housing option. Any project is only as good as the manager – Common Bond does have a good reputation for this. We are somewhat lucky to even find a developer. HUD allows an initial marketing plan to “core” constituents, but the housing is “equally open” to all.

Mike reports that marketing to able-bodied seniors who are able to live independently; would not have a high impact on the neighborhood. It wouldn’t bring in a lot of kids. The design would be four stories, and would have an elevator.

DE, town home representative, pointed out that Town Home residents are concerned that their investment will be stressed. In addition, home ownership would be the ideal, as a stabilizing force for the neighborhood, and the block in particular.

Dean estimates that the housing market will not recover for another 3-5 years. He also noted that Minneapolis rental laws don’t apply to condo owners making them actually more difficult to manage than rental housing.

Carol Pass concurred with the management difficulties of condos.

Linda noted that this neighborhood desires to build “multicultural” community design, and ways to bring the community together.

A question was asked: What happens to parking? HUDS are very tight on budgets. We did add another entry in the center of the building. The original design brought it all the way to the corner. Dean recommends that the neighborhood begin a “design process”, including the Town Home owners, to look at the design.

Kathy was asked: Why the rush ?– a decision to say we have financial obligations, others have a stake in this. Is this enough reason to go ahead with this project?

PRG responds that this doesn’t feel like a rush to them – they have notes going back to 2004 and their funders are calling in their notes. After granting repeated postponements in an effort to find a workable plan for building on the site, these funders are no longer granting extensions. Kathy noted that PRG has over $110,000 in time and money in the project, that is not even going to be covered – they are not making any money in this.

Kathy stated, “The city owns the land”. What can happen to this land in terms of our project? Dean recommends the best way to serve the neighborhood is to begin a community process so that all the information is on the table, all the neighborhood gets to air their concerns, and try to build something that conforms to neighborhood desires as much as possible.

PRG is willing to “work with the community, to take into account that there are concerns, and that there is a lot of financial investment concerned” but can’t speak for AICDC.

PRG has site control contractually, and therefore, there is not actually an “open opportunity” to redesign the project, however, there can be an opportunity to present different options to the community. AICDC plans to submit an application for HUD 202 Elder Housing funds in 2009. Their proposal could be skipped over the first year which is often the case.

Kathy noted that Sherman Associates has entered the process to verify whether they can make the project viable, but predicted that they will come up with the same $800,000 gap that was found by Common Bond. Mike confirmed that there is no money available for workforce housing, as AICDC has found in projects they are currently investigating.

CP asked, what happens if AICDC tries to do this, is the land then permanently locked up? Can any other planning go on in the meantime in case this option does not receive funding? She mentioned the neighborhood does not want to be left without a project in any case. The developer, PRG, has control over how long the land can sit vacant. Minneapolis hasn’t gotten any HUD 202 funding so it is highly likely that a Minneapolis project would be funded.

DE, town home representative, continued to point out the value of home ownership and that if the development would take two years to garner funding anyway, asked why they could not wait to see if the market would support homeownership at that time.

Meeting adjourned 9:18 PM.