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HomeMy WebLinkAboutAgenda - 10-08-2013 - 31 ORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: October 8, 2013 Action Agenda Item No. 3 SUBJECT: Affordable Housing Follow -Up Discussion DEPARTMENT: Housing /Comm. Development PUBLIC HEARING: (Y /N) No ATTACHMENT(S): INFORMATION CONTACT: A) Approved Minutes from March 12, Tara L. Fikes, (919) 245 -2490 2013 Joint Meeting B) Draft Proposal PURPOSE: To follow -up on affordable housing matters previously discussed at the March 12, 2013 Joint Meeting with the Affordable Housing Advisory Board. BACKGROUND: At the March 12, 2013 Joint Meeting, the following items were discussed by the Board of Commissioners and the Affordable Housing Advisory Board: I. Housing Bond Program The group discussed with Robert Dowling, the Executive Director of the Community Home Trust, a request for $75,000 in Housing Bond funds for the repair /replacement of the HVAC units at the Greenbridge Condominiums in Chapel Hill. Subsequently, the BOCC approved this request at its June 4, 2013 meeting. To date no funds have been expended for this purpose. II. Homebuyer Programs - Live /Work Requirements; First -Time Homebuyer The group also discussed with Mr. Dowling a request from the Community Home Trust (CHT) for a modification of the homebuyer requirements for properties sold by the organization using federal, state, and local housing program funding. Specifically, CHT asked that the first -time buyer requirement be waived after a property had been on the market for 90 days or longer without a contract. CHT also asked to be able to sell a property to a non - first -time homebuyer after 90 days without a contract. Subsequently, the BOCC approved this request at its May 7, 2013 meeting with a request that the CHT Board and staff revisit its existing housing program to determine its feasibility in this current economic climate to include the impact of housing acquired through inclusionary housing practices and rising homeowner association dues. To date, no sales have occurred from exercising this option; however, plans are to continue to monitor implementation and review the impact of this programmatic change in one year. The HOME Trust has sold one (1) house to a first -time homebuyer that did not live or work in Orange County after it had been on the market for nine (9) 1 months this year. This was based on the permission the BOCC granted a few years ago to waive the live /work requirement after six months. III. Proposed Affordable Housing Clearinghouse At the last meeting, a proposal was made to the BOCC to create an Affordable Housing Clearinghouse that would serve as a referral portal for County residents seeking affordable housing information and opportunity. Additional work has been done to formalize this proposal and the current proposal draft is attached for review and comment. Additional Interests Thus, the Affordable Housing Advisory Board (AHAB) in the coming months plans to focus its attention on: • Further development of the Affordable Housing Clearinghouse concept, • Discussion /exploration with CHT on its marketing strategies in an effort to help increase the number of timely sales. This will begin with a conversation to better understand the current inventory and marketing strategies. Additionally, there is interest in reviewing the land trust concept to include looking at other comparable land trusts to determine their experiences /successes and to determine if those could be replicated locally; and • Continued monitoring of Housing Bond Program in preparation for future consideration of another affordable housing bond referendum. As AHAB continues to develop its work plans, board members would like to know from the Board of County Commissioners if there are any specific work tasks they would like AHAB to pursue as well. FINANCIAL IMPACT: There is no financial impact associated with follow -up on affordable housing matters previously discussed at the March 12, 2013 Joint Meeting with the Affordable Housing Advisory Board. RECOMMENDATION(S): The Interim Manager recommends the Board follow -up on affordable housing matters previously discussed at the March 12, 2013 Joint Meeting with the Affordable Housing Advisory Board, and provide any direction to AHAB and /or staff as necessary. Attachment A APPROVED 4/23/2013 MINUTES JOINT MEETING ORANGE COUNTY BOARD OF COMMISSIONERS AFFORDABLE HOUSING ADVISORY BOARD MARCH 12, 2013 5:30 p.m. The Orange County Board of Commissioners met for a joint meeting with the Orange County Affordable Housing Advisory Board (AHAB) on Tuesday, March 12, 2013 at 5:30 p.m. at the Southern Human Services Center in Chapel Hill, N.C. COUNTY COMMISSIONERS PRESENT: Chair Barry Jacobs, and Commissioners Mark Dorosin, Alice Gordon, Earl McKee, Bernadette Pelissier, Renee Price and Penny Rich COUNTY COMMISSIONERS ABSENT: COUNTY ATTORNEYS PRESENT: COUNTY STAFF PRESENT: County Manager Frank Clifton and Clerk to the Board Donna S. Baker (All other staff members will be identified appropriately below). AHAB MEMBERS PRESENT: Jonzella Bailey - Pridham, Patsy Barbee, Diane Beecham, Katherine Doom, Nannie Richmond, Arthur Sprinczeles, James Stroud, Andrew Shannon AHAB ABSENT: HOUSING, HUMAN RIGHTS AND COMMUNITY DEVELOPMENT STAFF PRESENT: Dr. Tara Fikes, Director I. Introductions and Opening Comments Chair Jacobs welcomed everyone and introductions were made. AHAB Chair Patsy Barbee reviewed the following goals: Comprehensive Plan Housing Goals Housing Overarching Goal: Opportunity for all citizens of Orange County to rent or purchase safe, decent, accessible, and affordable housing. Housing Goal 1: A wide range of types and densities of quality housing affordable to all in all parts of the County. Housing Goal 2: Housing that is useable by as many people as possible regardless of age, ability or circumstance. Housing Goal 3: The preservation, repair, and replacement of existing housing supply. Housing Goal 4: Development ordinances and incentives that promote inclusionary practices and housing options for all income levels. Patsy Barbee said that the 2012/2013 work plan includes implementation of a media campaign that will stimulate conversation regarding the need for affordable housing in the community. This campaign will target the county and the towns of Chapel Hill, Hillsborough and Carrboro. She said that efforts will include brochures and the use of social media. Other work plan items include encouragement of expenditure of unspent funds from previous bond referendums and continued recruitment of advisory board members. She also reviewed concerns and issues for the coming year. These issues include: exploration of a future bond referendum for affordable housing, the northern Orange County options, and mobile home standards. 3 0 ,ommunity Home Trust - Housing Bond Program- Greenbridge Tara Fikes, Housing /CD Director, said there is a letter in the Commissioners' packet, dated Dec. 18th from Robert Dowling of the Community Home Trust (CHT). She noted that this is one of two letters asking that a portion of the county bond funds be set aside for anticipated repairs at the Greenbridge Condominiums in Chapel Hill. She said that this property was one of the inclusionary developments and has 15 condos that were sold to low income households. It was later discovered that the HVAC systems installed there are problematic, no longer under warranty, and very costly to replace. She said that the thought is that if some repairs can be done, the units may last longer. She referred to a letter from Attorney David Brooks, explaining what happens in the event of foreclosure and its impact on the warranties. She said that it has been requested that $75,000 be set aside for these anticipated repairs Commissioner Rich asked if these units will be replaced with longer lasting units that are not as costly to repair. Commissioner Gordon arrived at 6:08 PM. CHT Executive Director Robert Dowling said that the problem is that the units are no longer being made and when some units at Greenbridge broke down, someone cannibalized the parts from the unsold units to fix them. This meant that when those units were sold, the cannibalized units had to be replaced with a compatible system. He said that compatible replacements will be more reliable, but not as efficient. Chair Jacobs asked how much is being spent per existing units to fix the systems and how many units $75,000 will cover. Robert Dowling said 15 units will be fixed. He said new systems costs around $11,000 /unit now but will likely cost more in the future when replacement is needed. He said the $75,000 is being requested with the thought that it will provide a $5,000 down payment toward the future cost of a new unit for each of those 15 units. Chair Jacobs asked if this will proactively replace all 15 or just the ones not functioning. Robert said none will be replaced until necessary. Tara Fikes said the $75,000 will be used for repairs to extend the life of the units. Arthur Sprinczeles questioned how repairs can be made if parts are not available. Robert Dowling said it is complicated. He explained that the sensors can be replaced and this had been done in several instances over the winter. He said that the vision was that the $5000 /unit x 15 units will be put into a stewardship fund, and when a unit breaks, the $5000 can be put toward a new unit. Commissioner McKee asked if there is any way to disassociate the individual units from the linked system as they break, replacing them with new individual units. Robert Dowling said this can be looked into. Frank Clifton said the units were not selected by the county. The developer put "green" units into the project and the county and town had no role in selection of this. He said this situation should be considered in future discussions about housing inventory. Commissioner McKee clarified that he is not criticizing any county actions. 0 Commissioner Dorosin said the Board needs to re -visit the policy of this model with high end condo units and the sustainability issues that come with requiring unit set - asides. He said that integrated housing is desired, but issues like this and problems with homeowner association dues can outweigh the different price point units. He said there should be more control over how the units are designed and function in the future. He said the Board needs to really look at how it is using financial and political resources. Commissioner Rich said this discussion always occurs when development projects come forward. She said that the affordable housing program always wants units, but a plan needs to be made that considers a balance of the issues. Commissioner Dorosin said the lesson learned with Abby Court is that the homeowners associations are controlled by the majority of the unit holders; and the majority is not the affordable housing residents. This means that those low income residents are at the mercy of the association. Chair Jacobs said Orange County government does not require any condo units; that is done by the towns. He said Robert Dowling did ask the towns to re -visit this issue. He said unless they engage the municipalities in this discussion, affordable housing in the southern part of the county is not under the Board's purview. He said perhaps promotion of high density housing is desired so that affordable units are possible; however this means the Board needs to have its own policy. He said that, with this building, he would like to see if there are any other systems like this that will become an issue a year from now. Commissioner Rich said the Bosch washers and dryers are the same situation. Chair Jacobs asked if anyone has done a comparative analysis of the pitfalls of these units, Robert Dowling said an analysis has not been done. He said there has been a transfer fee tax implemented that will support affordable units, and as units sell, these fees will help. He said that there will be special assessments and there is money for some of these unknowns, but there is not enough money to pay for the HVAC units. Commissioner Price clarified that if the Board goes along with this request, the money will pay for new units, not repairs. Robert Dowling said CHT could handle the small repairs. Katherine Doom said AHAB did ask extensive questions during their tour of Greenbridge. She said that there are no good answers here. She said AHAB spoke with owners of units and saw both a low end and a high end unit. She acknowledged that there is not a good way to resolve this issue. Tara Fikes said the recommendation of AHAB is for these funds to be set aside for the requested services. She has talked with the Orange County Finance Director, who said it is okay to move forward. She said the recommendation is for approval of the requested funds. Katherine Doom said there was no way to avoid hurting the homeowners if the funds are not approved. Commissioner McKee said Robert Dowling mentioned another style that could possibly be put in the units. He requested that Robert Dowling let the Board know the answer as to whether this could be done. - HOME Program — Live/Work and First -time Homebuyer Requirements Tara Fikes said the second letter in front of the Commissioners came from CHT and highlights the difficulties CHT is having in selling homes. She said the request is for the HOME review committee to be relieved of the Live/Work clause (having to work and live in Orange County). She said the request is that if a buyer cannot be found in Orange County within 90 days, CHT would like to look outside of Orange County to broaden the pool of purchases. She said there is also a request to waive the first time home buyer requirement after 90 days. She 4 said the Home Review Committee has discussed this and Commissioner McKee represents the Orange County Board of County Commissioners on this committee; however she wanted to share it with the whole board. She noted that CHT is having significant difficulty in selling properties. Commissioner Dorosin asked if the HOME committee has a position on this issue. Tara Fikes said the committee was willing to waive these requirements and review in a year to see if it made a difference in sales. Commissioner Dorosin asked if AHAB looked at this issue and does it have a recommendation. Tara Fikes said no, the AHAB has not looked at it. Commissioner Rich asked if this had gone to Chapel Hill Town Council yet. Robert Dowling said it has gone to Chapel Hill, but they have not responded yet. Commissioner McKee said there was reluctance to do this because of the precedence it would create; however there was recognition of the decline in the housing market. He said the general sentiment was to move forward with implementing the 90 day waiver and look at it again in a year. He said these units need to be occupied and it would be great to have residents from Orange County, but this other route is best in the meantime. Commissioner Pelissier asked if there has been any effort to approach another local bank to see if there could be some help with the borrowing issues. Robert Dowling said yes. He said when he went to the Chapel Hill Council and made this request, he was told that he faced so many obstacles that he had no control over. He said a council member encouraged him to come forward with bigger plans and be very real with the Town Council. He has done this, but has not received a response yet. He said he has talked to many banks, but they don't seem to like the CHT model, because their collateral is the lease hold interest in the property and there is no knowledge of this worth. He said the banks want the property itself in the event of foreclosure, rather than the lease hold interest, in order to lend money. He said this is what CHT has to discuss as a committee because this would mean the properties would be lost in the event of foreclosure; however, this may be the way things have to be done in order to move forward. Commissioner Pelissier said she is fine with waiving the requirements, but she feels priority should be given to Orange County residents who might have just moved here. Commissioner Price asked if CHT has had people from outside of Orange County requesting housing. She also asked about prioritizing people who are born and raised in this county and want to come back. Robert Dowling said it will not make a big difference if they waive these requirements. He said they occasionally do come across someone who could purchase the home but is unable to because of the requirements. He said this will help with those occasional situations and clarified that there won't be any recruiting in other counties Commissioner Gordon said that she hears the information with concern. She said, having been around when this program was instituted, she knows that these rules were put in place for a reason. She said the goal was to help individuals in Orange County, who might not otherwise be able to live here. She said that if these rules are eroded, it raises the question of whether the goals of the program are being met. She said that this should be for people with some commitment to Orange County. Commissioner Dorosin said he feels these requirements should be jettisoned. He said that the program still targets low income residents and once the person has bought the property, they become an Orange County resident. He noted that these residents will then shop here and pay taxes here, and that these residents tend to stay. He asked if CHT has considered converting these properties to rentals. 7 Robert Dowling said this had been considered but there are complications, including; subsidy money in the property, restrictive special use permits, and workload of rental management. Chair Jacobs said he appreciated Commissioner Gordon's comments but he agrees with Commissioner Dorosin. He said that he defers to Robert Dowling's expertise and he feels there needs to be more flexibility. He suggested that a date six months from now be chosen and a report be given at that point to see how things are going. Chair Jacobs suggested that, at some point, Robert Dowling share with the full board the points he made at a past Assembly of Governments meeting. He said this would give a more comprehensive look at the issues that CHT and affordable housing in general, are facing. Frank Clifton noted that Robert Dowling had already said the current model was created 15 years ago and it is not currently working. He said that he understands that CHT does not want to do rentals, but when the units sit empty for 6 months, it becomes a philosophical issue, and perhaps there ought to be rentals in order to generate income. He said there ought to be a more in -depth discussion about these things to decide on the key priorities. He said there are going to be fewer and fewer federal dollars over time and so there needs to be an analysis of how to get the best bang for the dollars that are there. Commissioner Gordon said it is a good idea to go back and look at the model again. She said that goals and priorities need to be examined again and the incremental changes being discussed at this meeting don't get at the basic issues. Affordable Housing Awareness Campaign AHAB Member Katherine Doom said that a UNC marketing class took up this cause as a case study in class and surveyed the community about affordable housing. This survey revealed a general lack of awareness of the issue. She said that the class put together an awareness campaign, which initiated AHAB to begin a media campaign through Facebook to raise awareness about the issue and the opportunities in the county. AHAB manages the page and plans on posting meeting information, and special events and opportunities. There is also a brochure planned on affordable housing. IV. Proposed Affordable Housing Clearinghouse AHAB Member James Stroud distributed a hand out on the Clearinghouse. He said the goal is to impose this clearinghouse to have a catch all, one stop shop for all things regarding affordable housing. He referenced a copy of the business statement and said the current goal is to develop a committee to come in and assist in the design of a clearinghouse. He noted that the Center for Home Ownership has received national accreditation from the National Community Re- investment Coalition, so the capacity is there for this project to be pulled together. V. Other Discussion Items VI. Closing Statements Chair Jacobs suggested a work session with affordable housing in October with a longer time for discussion. VII. Adjourn The meeting adjourned at 6:59 PM . Attachment B 8 DRAFT PROPOSAL Orange County Clearinghouse Network OCC Network Values • Housing is a basic right and the foundation for success in life. All County residents benefit when everyone has a safe place to call home. • Preparation is the most important step in the process and individuals should have the ability to choose the housing that best suits their individual needs. It is important to appreciate and support the evolution of their search for housing. • Because housing resources are finite due to the limited number of programs and services available to Orange County residents would benefit from the operation of this proposed network of resources. Mission Statement: Our mission is to heighten the general awareness of housing needs by providing a clearinghouse type referral network for organizations and individuals seeking information regarding affordable housing in Orange County. Objective: To implement a resource referral housing network by establishing a central database with information about housing opportunities in Orange County. Design: The Orange County Clearinghouse (OCC) Network will offer the following type of information • Available housing Inventory for both rental and homeownership • Local Affordable Housing Program Information • Available federal and state housing programs • Financial Literacy & Money Management Training • Homebuyer Education Training • Foreclosure Prevention Counseling Services • Homeless Resources Operation: The OCC Network will operate from the Centre for Homeownership & Economic Development (CHOEDC) office in Hillsborough and will be managed initially by volunteers during normal business hours. A dedicated phone line will be established to receive calls to answer questions and provide referral information. Long Term Goal: The Clearinghouse Network would include a community based rental property listing service available to the general public. Funding: The initial funding for the Clearinghouse Network will be provided by the Centre for Homeownership & Economic Development (CHOEDC) located in Hillsborough. Future funding will be solicited through U.S. Housing and Urban Development (HUD), Wells Fargo Foundation, PNC Foundation and local governmental entities. Timeline: Implementation to begin July 1, 2014.