COUNCIL OF THE CITY OF PHILADELPHIA PUBLIC HEARING AND PUBLIC MEETING BEFORE COUNCIL COMMITTEE ON FINANCE - - - Room 400, City Hall Philadelphia, Pennsylvania Thursday, 5/31/01 2:07 p.m. - - - BILL 010373 - Authorizing the Mayor, on behalf of the City, to file an application with the United States Department of Housing and Urban Development (HUD) for a community development block grant; and to take any and all other action necessary to participate in the Section 108 Loan Guarantee Program. . . BILL 010348 - Declaring that it is desirable for the health, safety, and welfare of the people of the City of Philadelphia served by the Community College of Philadelphia for the Hospitals and Higher Education Facilities Authority of Philadelphia to provide certain financial assistance to the Community College of Philadelphia. . . PRESENT: COUNCILWOMAN JANNIE L. BLACKWELL, Chair COUNCILWOMAN MARIAN B. TASCO, Vice Chair COUNCILMAN DARRELL L. CLARKE COUNCILMAN DAVID COHEN COUNCILMAN FRANK DICICCO COUNCILMAN W. WILSON GOODE, JR. COUNCILMAN JAMES F. KENNEY COUNCILMAN RICHARD T. MARIANO COUNCILMAN MICHAEL A. NUTTER COUNCILMAN BRIAN J. O'NEILL COUNCILMAN ANGEL ORTIZ COUNCIL PRESIDENT ANNA C. VERNA - - - VINCENT VARALLO ASSOCIATES, INC. Registered Professional Reporters Eleven Penn Center, Suite 600 Philadelphia, PA 19103 (215) 561-2220 2 /00 FINANCE I N D E X Page BILL 010348 Donald Cramp, Director . . . . . . . . . . . Hospitals and Higher Ed. Facilities Authority Dr. Steven Curtis, President . . . . . . . . Community College of Philadelphia BILL 010373 John Kromer, Director, OHCD. . . . . . . . . 10 Mjenzi Traylor, First Deputy Director. . . . 23 Commerce Department 11 James Fluck, Executive Vice President, PIDC 28 12 Curtis Jones, President and CEO. . . . . . . 39 Philadelphia CDC John Lenahan, Vice President Lending . . . . 41 Department, Philadelphia CDC Scott Wilds, Assistant Housing Director. . . 55 Dainette Mintz, Director . . . . . . . . . . 90 Special-Needs Housing Roderick Lyles, Fiscal Officer, OHCD . . . . 109 Rose Gray, Director of Development . . . . . 141 Association Puerto Riquenos En Marcha Anthony McIntosh, Executive Vice President 146 Philadelphia Housing Development Corporation 3 5/31/01 FINANCE - BILL 010348 P R O C E E D I N G S
Good afternoon. This will begin our Finance Committee hearing. The first bill for consideration is Bill No. 010348. A quorum being present, we can begin. To my left is Councilman David Cohen. To my right, President Anna Verna, and to her right, Councilman James Kenney. We will ask the clerk to read the title of the bill.
Thank you very much. Let me say good afternoon. Thank you for your patience. Please identify yourself for the record and begin your testimony an welcome.
Thank you so much. My name is Donald Cramp. I am the Director of the Hospitals and Higher Education Facilities Authority. I am very pleased to be here with Austin McGreal to my right, general counsel of the Authority; to my left, Dr. Steven Curtis, President of Community College of Philadelphia; and Mr. Kevin Scott, counsel to the Community College, to the left of Dr. Curtis. Also 4 5/31/01 FINANCE - BILL 010348 in the audience, we have several other expert professionals should there be a need. May I first express my appreciation to you, Madam Chairperson and each member of the Finance Committee for your courtesy to address our needs before the summer recess. By hearing us today, you will give us the flexibility to sell the bonds possibly in the late summer and at a time when it is judged that the interest rates are favorable and thereby, the cost savings to the college can be maximized. Also, your considerate hearings today will enable us to be respectful of the timing of other possible bond financings intended for sale to the public on behalf of the City of Philadelphia. As well, I wish to make a brief introductory statement in support of the proposed bill before you. At the board of directors meeting of the Hospitals and Higher Education Facilities Authority of Philadelphia on April 10, 2001, the Community College submitted an application for financing. The application seeks the Authority's assistance in the proposed financing. Before turning to Dr. Curtis, may I close as I began. For the Authority, thank you for 5 5/31/01 FINANCE - BILL 010348 helping us work in a cordial manner with our hospitals and universities. Your courtesies never go unnoticed. Now it is with true and great pleasure that I turn to Dr. Steven Curtis, President of the Community College of Philadelphia.
My name is Steven Curtis, President of the Community College of Philadelphia, and I'm here to provide testimony in support of Bill 13 No. 010348. The purpose of this bill is to authorize the Hospitals and Higher Education Facilities Authority of Philadelphia to issue tax-exempt bonds on behalf of the college in an approximate amount of $35 million. The proceeds of the bonds will be used to finance the cost of the acquisition and construction of a new business and industry technology center for the Community College of Philadelphia. The center will be located on an undeveloped parcel of land at 18th Street and Callowhill Street in Philadelphia, adjacent to the 6 5/31/01 FINANCE - BILL 010348 college's main campus. The three-story center will be approximately 97,000 gross square feet on top of a two-story below-grade partially-enclosed parking garage. The site will accommodate the college's Division of Community Services and Continuing Education Programs, which have outgrown space currently -- I should say, which have outgrown space which is currently leased at 16th and Callowhill Streets. The center will also accommodate some of the degree programs offered by the college which makes the greatest use of advanced computer technologies. The three-story building will contain a combination of computer laboratories, so-called "smart" classrooms, distance-learning classrooms, a new career planning and placement center for students, faculty offices, meeting rooms, and seminar rooms. The design of the building will ensure flexibility to accommodate current and future technologies. Classroom and seminar spaces will be designed in a variety of configurations to address the wide range of customized and instructional programs offered by the college to business and 7 5/31/01 FINANCE - BILL 010348 industry clients as well as to meet the needs of degree programs offered by the college, again, using advanced computer technologies. To assist the college in the development of the project, the college has engaged the Binswanger Companies, a well-known and respected real estate firm, to acquire and develop the project on the college's behalf. The project will be developed and owned by a Binswanger affiliate, Combins LP, and leased to the college pursuant to the terms of a long-term lease. The college will have the option to purchase the project at the end of the term for a nominal sum as well as the option to purchase the project during the term of the lease for an amount equal to the unamortized debt issued to finance the project, plus a nominal sum. The college has applied to the Hospitals Authority for financial assistance, which would consist of issuing its revenue bonds, series of 2001, in an amount not to exceed $35 million for the purposes of financing the project on behalf of the college. The revenue bonds will be secured by an assignment by Binswanger of the payments made by the college under the lease directly to the bond 8 5/31/01 FINANCE - BILL 010348 trustee. The lease payments will be made directly to the bond trustee and will be sufficient to pay the principal and premium of and interest on the revenue bonds. At the same time, the college estimates that -- excuse me. At this time, the college estimates that the total cost of the project, including capitalized interest, reserved funds, and issuance costs will be approximately $29 million, and is requesting that the Authority issue its revenue bonds in a like amount to finance the project. The college and Binswanger are committed to using their good-faith efforts to obtain participation in minority- and women-owned contractors and subcontractors for the project. We expect to meet at least the minimum City goal of percent minority and women participation. 19 This concludes my testimony, and I'll be 20 glad to answer any questions that you might have. 21 Thank you. 22
Thank you very 23 much. 24 The Chair also notes that Councilman 25 Darrell Clarke is here. 9 5/31/01 FINANCE - BILL 010348 Thank you. Are there any questions for members on the committee? (No questions.)
All right. What we are going to do on this bill is to -- for the purposes of Bill No. 010348, we're going to conclude our public hearing and enter -- are there questions? (No questions.)
We're going to recess our public hearing and enter into a public meeting for the purposes of 010348. I'm going to ask Councilman to give me a motion with a suspension of the rules for this bill.
Thank you, Madam Chair. I move that Bill No. 010348 be reported out of this committee with a favorable recommendation and a request made for a rules suspension to allow for first reading at our next Council session. (Duly seconded.)
All in favor? 10 5/31/01 FINANCE - BILL 010348 Opposed? It has been moved and seconded that Bill 4 No. 010348 be reported out of committee with a favorable recommendation and also a recommendation that the rules be suspended so as to permit first consideration at our next session. Again, all in favor? Opposed? The ayes have it.
May I just make a motion to the relatively new president of Community College. This expresses or great respect and admiration both for the Hospitals and Higher Education Facilities Authority and for the work of Community College over many, many years. We wish you extremely well in your endeavors to continue to raise the level of Community College. We think it's the finest community college in the country, and we think it just performs in an outstanding way for all of the people of Philadelphia. And that's the reason you find so little question. We know the Authority studies the 11 5/31/01 FINANCE - BILL 010373 situation very carefully before it makes its recommendation. Your explanation was very clear. We wish you well in this development.
I think that Councilman Cohen spoke for all of us. We appreciate all that you and certainly are happy to support this legislation. Thank you very much.
And that also includes the counsel for the committee, Mr. McGreal.
Now that we have concluded this piece of legislation, the Chair notes that Councilman Michael Nutter has resumed and we also resume our finance hearing with regard to our community development block grant application. We will please ask Mr. Kromer and whomever else you would like to have with you at the table to come forward to begin your testimony. Again, thank you all for your patience, and as you know, we will have the Administration's testimony 12 5/31/01 FINANCE - BILL 010373 today and we will have the community groups starting at on Monday. It might make it a little simpler 4 this year with starting the community on Monday, but 5 today, we will try to conclude all Administration 6 testimony. 7 (Witness comes forward.) 8
Having said 9 that, the clerk has already read the bill, and 10 Mr. Kromer, please identify yourself for the record and begin your testimony. We also note that, before you do that, Marian Tasco, Vice Chair of this committee, is here. Thank you.
Good afternoon. I'm John Kromer, Director of the City of Philadelphia's Office of Housing and Community Development. I've submitted written testimony, but I'd like an opportunity just to provide some additional comments, which I think I can deliver in fewer than five minutes and which I think would be helpful in addressing some of the issues which Council may be concerned about. A key issue is with the community development block grant is always resources -- what 13 5/31/01 FINANCE - BILL 010373 are we getting, where's it being spent, how much do I get for my particular interest. And one of the issues and resources is really going to be an important topic at this hearing and during this year. We really have to prepare ourselves for a fundamental change in the way that the community development block grant is regarded. During the past decade, it was possible to use the block grant as the primary resource for neighborhood reinvestment. There was a lot of it and we could use its flexibility to do a lot of things, and that situation has changed for a few reasons that I'll describe in a moment. And going forward, starting with the coming year, the block grant really cannot be regarded as the primary central resource for neighborhood reinvestment. It's got to be regarded as one of several key resources that need to be used in coordination and in concert with one another. In past years -- and I'm speak really of the past eight years -- there's been a lot of community development block grant money and other federal money available for neighborhood 14 5/31/01 FINANCE - BILL 010373 reinvestment. During the early 1990s, tens of millions of dollars remained unspent, and it was possible to tap into those unspent dollars from prior years to begin doing a lot of housing production. During the Clinton administration, HUD Secretary Henry Cisneros was very generous to Philadelphia, and we received a home ownership grant, an empowerment zone grant, and several other special grants which really supplemented the federal money that we received every year. That pattern has really stopped and there have not been any special federal award programs now for sometime. A third factor during the 1990s was a Section 108 Program, and every year for a period of five or six or seven years, I came to Council and requested and obtained approval for Section 108 financing for various housing activities. And, again, that was a resource of tens of millions of dollars, which was very valuable to the City. The neighborhood which was the primary beneficiary of the Section 108 borrowing during that period was Logan. Section 108 dollars were borrowed every year to support relocation of residents from 15 5/31/01 FINANCE - BILL 010373 the Logan Triangle, and if we hadn't done that, we would be here today with about 250 families living in imminently dangerous housing in the Logan Triangle area. So I'm pleased with the results of the Section 108 borrowing. But we're not going to be able to sustain that level of activity because we don't have access to those additional resources that were so readily available in past years. And just to give you a sense of the impact of the reduced resources on our program, I wanted to give you one handout that shows the performance of the Basic Systems Repair Program over the past few years, and you'll see how the decline in resources has affected our ability to deliver home repairs, which I know are a concern to most or all members of City Council. 7 million available for these repair programs and produced about 6500 units of repair. In Year 25, by contrast, the last fiscal year, only about $9 million was available, and production dropped by nearly two-thirds, down to about 2500 units. 16 5/31/01 FINANCE - BILL 010373 And the reasons for that drop in production primarily were two. 4 million in Year 21, down to nearly a million dollars less in Year 25.
And that drop means 850 to 900 heaters that couldn't get replaced, or collapsing roofs that couldn't get replaced. That's significant. 3 million in Year to $6 million less in Year 25. 12 So why the reduction in community 13 development block grant dollars? And the answer is 14 that the block grant began to get spread a little 15 more thinly during those years and stretched a 16 little more further than it had to in previous years 17 because those federal grants weren't coming in and 18 the prior years' unspent funds weren't available. 19 And a primary activity during those 20 years, which continues to be a priority activity, 21 was housing production, and I just have a onelist here of the housing production pipeline, which includes new construction and vacant house rehabilitation ventures to which the Administration and Council has made commitments. And these are 17 5/31/01 FINANCE - BILL 010373 published in the plan that was approved by Council in the last fiscal year. And for all of these ventures, we have committed funding for pre-development work, for acquisition, or for bricks and mortar activities. You'll see in this current pipeline of development ventures which have received some level of support but have not been fully funded, we've gotten nearly 800 units and we've got an estimated commitment of over $44 million yet to be committed during this coming fiscal year and in future fiscal years. So the bottom line from all of this is that we can't support more housing preservation, more housing repair, more housing production, plus authorize new development ventures; we just don't have the resources that we used to have. We can certainly use community development block grant as a base which provides some support and leverages other resources, but we can no longer view the community development block grant as the place to go to fund all of these things exclusively. So where else can we go and how can we blend other resources with the block grant to address this pipeline, which is a City commitment, 18 5/31/01 FINANCE - BILL 010373 it's a published commitment, to get the job done? I have one last handout which suggests some ways in which we can address this issue of resources based on some opportunities, most of which have just emerged within the past year. And one of them I don't want to spend too much time on but mentioned right off the bat is the Mayor's -- the bond financing associated with the Mayor's Neighborhood Transformation Initiative, and I do want to mention this and cite the example of the Jefferson Square sales housing that's identified in the first of the nine ways to create more resources for neighborhood reinvestment. Jefferson Square, even if it receives the State Home Ownership Choice Award, which we will be applying for, Jefferson Square needs $3 million in City subsidy over and above the State funding, $3 million to support this sales housing venture. That's double the maximum subsidy amount that the City has approved in past years, and the question is, with this pipeline and with the demand on the limited resources, how could we approve double the subsidy that we're accustomed to authorizing? And the response that's being proposed through 19 5/31/01 FINANCE - BILL 010373 Neighborhood Transformation Initiative is to blend some limited community development block grant support with acquisition and site preparation from the bond financing, but it's really more than that, and you can read this handout for yourself. I just want to --
Excuse me, Mr. Kromer, excuse me one moment. Councilman Nutter asked that you back up maybe two paragraphs ago and begin again. And while he's doing that, Mr. Traylor, would you come forward because we'd like to get all of the testimony on the record and then ask our questions. It might make life a little more organized. Thank you. Mr. Kromer?
Sure. I was touching on the issue of resources and the limitations of resources and the desire that I think we all share to fund a range of activities from preservation to new production to new ventures over and above those that are in the pipeline.
You said something 20 5/31/01 FINANCE - BILL 010373 about the amount of subsidy and doubling the subsidy or something like that, and I lost you at that point.
Yes. One of the ventures in the development pipeline is the Fifth and Reed sales housing, the Jefferson Square venture, which the City has supported in the past and which Mayor Street has proposed as the City's entry in the State-funded Home Ownership Choice Program, which we hope would provide some additional funding from the State. Even if Philadelphia's successful in receiving that State funding, $3 million of subsidy is required in order to bring Jefferson Square to implementation. And in past years, our published underwriting criteria has specified that the maximum subsidy shall be $1.5 million.
Well, that's just been an established practice that's been published annually in the plan and authorized by Council as part of the plan. It's one of the standards that we've used.
All right. I'm sorry. Okay. 21 5/31/01 FINANCE - BILL 010373
All right. So we want to get all of the testimony out first, Mr. Kromer.
Thank you. I'll just wrap up quickly. Just to cite two of other items in the Nine Ways Summary, the second one, we need to do more leveraging from non-City sources and the proposed West Oak Lane Home Improvement Program, which is being sponsored by the LISC Program, in concert with two private-sector entities, would leverage $5,000 per property for every $3,000 in subsidy that the City puts down. So we like that and we'd like to do more of that in the future, and we've got to do more of that in order to increase the resource base for home repairs and the other activities that we care about. Something more immediate is item no. 7, reduce the soft costs associated with housing production. One of the biggest soft costs that appears in the current development budget is for ventures like the ones in this pipeline is construction interest. And with -- through coordination with Redevelopment Authority, we will 22 5/31/01 FINANCE - BILL 010373 be drawing down a $10 million community development block grant float loan in order to establish a zero-interest construction loan fund at the Authority that will provide construction financing for development ventures that are receiving subsidy from the City. The first venture to be financed through this construction loan fund, which is the next phase of Cecil B. Moore sales housing, will save approximately $200,000. One deal, $200,000 in saving on soft costs. So these items add up to a lot of additional resources, and I hope that reinforces my point that we need to continue to regard the block grant as a very significant base for further activity, but we can't regard that as the only resource. We've got to work the block grant in combination with other sources of funding in order to continue to be ambitious about neighborhood reinvestment and achieve the performance results that we all want to see. Thank you.
Let me note before Mr. Traylor begins that Councilman Frank 23 5/31/01 FINANCE - BILL 010373 DiCicco is here. So we have a full contingent of Councilpersons who are here for this hearing. Councilman W. Wilson Goode is also here. Thank you. Mr. Traylor, would you identify yourself for the record and present your testimony.
Thank you. My name is Mjenzi Traylor. I'm First Deputy Director of the Commerce Department. Good afternoon, Councilwoman Blackwell and members of City Council. I am here today to present testimony in support of the Fiscal Year 2001 Consolidated Plan. With me this afternoon are Curtis Jones, President of Philadelphia Commercial Development Corporation, and James Fluck, Vice President of Philadelphia Industrial Development Corporation. For Fiscal Year 2002, the City's approach to neighborhood economic development continues to encompass three goals: assisting small neighborhood businesses, investing in neighborhood physical infrastructure to improve the business environment near residential areas, and fostering the group of community economic development skills and capacity particularly within community 24 5/31/01 FINANCE - BILL 010373 development corporations. Today, I would like to point out major program areas that will receive changes in funding for Fiscal Year 2002. Our lending and grant programs are administered by PCDC, PIDC, and the Commerce Department. PCDC's Small Business Revolving Loan Fund will be increased from $1,650,000 to $3 million. In the current year, businesses will 10 receive loans under the program -- that is, under 11 the SBRLF Program. This fund, together with PCD's 12 other financing programs, will achieve approximately 13 100 transactions. 14 The Neighborhood Development Fund is 15 administered by PIDC. This was a lending program, 16 which, in past years, provided the gap financing for 17 numerous neighborhood businesses and development 18 projects. NDF received no funding in the current 19 year but will receive $2 million in the 2002 budget. 20 As stated in the Consolidated Plan, PIDC will 21 provide assistance to at least 15 projects, which 22 will retain 600 jobs and create 1400 new ones. 23 The Neighborhood Support Services 24 Program, which supports targeted neighborhood work 25 by CDCs in nine neighborhoods, will be increased 25 5/31/01 FINANCE - BILL 010373 from 900,000 to 950,000. The Commerce Department will continue to offer three levels of grant support. The Pre-development Grant will be increased from 150,000 to 200,000. The Planning and Marketing Grants will also go from 150 to 200,000. The Neighborhood Development Grants, which received no funding in the current year, will receive $1,500,000 in 2002. PCDC will draw down Section 108 funds to assist in larger-scale development projects and to support our Neighborhood Lending Programs. The primary goals of these Section 108 loans will be to create permanent jobs for residents in Philadelphia, to stimulate private investment, and to generate tax ratables for the City. While the creation of jobs for low- and moderate-income Philadelphians will be the key criteria for these loans, the expansion of retail goods and services in our neighborhoods and the elimination of blight will be an alternative criteria. There was no Section 108 allocation in the current year; $15 million is budgeted for year 2002. PCDC will continue to operate the Targeted Neighborhood Commercial Area Program. This 5/31/01 FINANCE - BILL 010373 program provides for an array of support services to 38 commercial areas, and these areas are listed on Pages 74 and 75 of the Consolidated Plan. In addition, PCDC will provide direct assistance for for-profit businesses and nonprofit organizations which act as key service providers and employers in these commercial areas. The principal goal of the TNCA Program is to enable these businesses to remain and to expand while providing needed goods, services, and employment opportunities for Philadelphia's low and moderate-income residents. PCDC will also provide acquisition grants to community-based development organizations located in these commercial areas. The CBDO's will acquire and improve the properties.
After the improvement is completed, they will either lease or sell the properties to businesses that will provide retail goods or services to the low- and moderate- income residents of that neighborhood. I would like to take this opportunity to thank Council for their ongoing commitment to the Office of the City Representative and Commerce Department's economic development activities. We look forward to working closely with members of 27 5/31/01 FINANCE - BILL 010373 Council to continue to strengthen the economic base of the City. My colleagues and I will be pleased to respond to any questions Council may have. Thank you.
Thank you. And we thank everyone else from all of the housing departments who are here this afternoon. Now we'll begin our fun part -- our questions. I think for Mr. Traylor, we only have one -- I only have one. Would you provide information as to the projects that will retain 14 the jobs, that will retain 600 jobs and create new 15 ones? Would you give us details about who they are?
No, those projects are not known at this time. That will come through an application process to PIDC. And if you want some further explanation of how that application process will work, we can have Mr. Fluck give us that at this time.
Or what the criteria is for people to apply would probably be most useful in how jobs are created and who can 28 5/31/01 FINANCE - BILL 010373 apply and how they can apply. That would be very helpful. (Witness comes forward.)
Thank you. Good afternoon. Please identify yourself for the record. Thank you.
Good afternoon. My name is James Fluck, and I'm Executive Vice President of PIDC.
Regarding your question in terms of the application process, basically, an application under the program has to meet one of the criteria established under the CDBG program for fundability. It has to benefit low- and moderate-income individuals, it has to employ low- to moderate-income individuals, and it has do so at the rate of employment of low- and moderate-income individuals one job per $35,000 of lending. So those are the general criteria that we look at in terms of identifying prospective 29 5/31/01 FINANCE - BILL 010373 projects.
And then we'll provide an application, we'll go over it with a client, and evaluate the project with a client.
No, no. This is simply an application. Again, we look at things like: total project; what's it cost; what's the financing; what are the sources of the financing; in addition to the financing we provide, is there any private financing; how many jobs will it create. Those kinds of things are what we look at and evaluate.
Okay. How will 600 jobs be retained and 400 new jobs created?
These are estimates based on our experience in dealing with clients over -- these are goals that we establish for the program. As Mr. Traylor said, there aren't any specific companies that have been identified at this time, 30 5/31/01 FINANCE - BILL 010373 but they will be over the coming fiscal year.
Let us also note that we note City Planning is represented, PIDC and PCDC. We see Mr. Jones. All right. Does that answer the questions for the committee on that particular issue? Then we'll go back to our questions for Mr. Kromer.
All right. Then we'll entertain questions for Commerce. And then, Mr. Kromer, we'll keep you for last. Councilwoman Tasco.
The Mayor's Business Action Center comes under your department?
Team, right. What is the staffing level? Is it the same level that it was under the prior administration?
No. If I'm not mistaken, 31 5/31/01 FINANCE - BILL 010373 Councilwoman, I think we are two persons under the staffing that was under the previous administration.
I think that we've been trying to not fill them. In other words, if the -- if the current staff -- there has been some restructuring of the department, and if the current staff is able to serve the demand into that unit, then we will live with the current staff. Otherwise, we'll have to fill those slots. But that's a limited budget that they're operating under and so we'd like to keep the staffing at the level it is now.
As you know, we all represent business districts within our Councilmatic districts and as you know, many, many, I guess, if not most of the districts are quite diverse ethnically. And we from time to time -- particularly I do -- run into problems with language barriers, particularly on Fifth Street. And what I'd like to know is, what is the plan for your department to be to have a staff that reflects the diversity of these business strips? Because we have 32 5/31/01 FINANCE - BILL 010373 more problems because of lack of communication, business people don't know how the City works, they don't know the rules and regulations, I have more complaints about trash, I have more complaints about various zoning issues. And part of the problem we recognize is the ability of our government to communicate with its citizens. And what is being done and will be done? I know you hired someone we recommended to work with the Asian population, but it's nearly not enough to do that because there are other groups that require communication and an understanding of how government works.
As you said, Councilwoman, we did hire over at PCDC in two language areas where there's the higher demand -- and that is for the Korean community as well as for the Spanish-speaking community. And right now, if MBAT has a contact -- you know, in other words, if we're contacted by someone from the business community, Korean business community, and there seems to be a language barrier, then we would call upon, and have called upon, PCDC's person to help us with that. Now, to my knowledge -- and the same 33 5/31/01 FINANCE - BILL 010373 thing is true with the Spanish-speaking person who is a part of PCDC staff. Now, I think that if there is evidence that is presented by any of the businesses that you represent that that system is not serving them, then we would have to seriously consider adding to, you know, the staffs and, you know, maybe even directly to the MBAT staff to accommodate that. I'm not aware that there is any backlog that comes by way of there being language barriers.
The issue becomes -- I don't believe that they're going to reach out to us; it is our responsibility. For example, last Friday, I did a walk-through on Fifth Street, and I met with the young man who works in the Streets Department who works with the businesses around trash issues, and I asked him what was the real problem. He said the real problem for him was the language issue. So there has to be some coordination there with that department when you're dealing with services and what the City requires -- not so much and I know what you do. You work -- you develop business, but you also are in business retention. 34 5/31/01 FINANCE - BILL 010373
And so what I see a need for is to have a coordination with L&I, the Streets Department, and communicating to the merchants what their responsibilities are around certain governmental issues they have to deal with.
And so when we go there and we talk to them about how they should put trash out or that they should have Dumpsters or they can't put a retail in a wholesale or there are other issues that -- just because they don't know, you see?
So, you see, there has to be some outreach from us to them in conjunction with those departments that can provide services to them about what they have to do.
Okay. I think I understand the problem or the issue that you're pointing out, and I think what we'd like to try is 35 5/31/01 FINANCE - BILL 010373 this, because it is clear that we have not communicated with the other departments of the City, as you're saying, that these translating services are available for them.
And it is MBAT's job to be the representatives on behalf of the businesses for any department of the City. I mean, it's their job to do that interacting with the other departments of the City. I think that I'd like to take your suggestion, though, and first see whether we can deal with this issue by communicating with the departments that we have people who are capable of translating in these two communities and then see where we wind up with that.
You know, I'm not being critical; I really want to offer this as the benefit of the experience we've had. And we work well with MBAT and we're not criticizing them at all. I just wanted to give you my observation and the problems I deal with and in responding to concerns raised by the residents from the surrounding community in terms of what's happening 36 5/31/01 FINANCE - BILL 010373 on the business strips. And I just see a better -- a stronger need for a better communication from the MBAT office and in conjunction with the departments that we have to deal with. And I think that would serve us all better.
With regard to the same issue, the Chair recognizes Councilman Kenney.
Thank you. Thank you, Madam Chair. One of the suggestions I would make in regards to Councilmember Tasco's line of questioning is that -- I don't know what kind of interface and contact that MBAT or Commerce has with the various number of business associations throughout the City. Through my work with the immigration issue, I've come to meet with, based on their outreach to me, numbers of ethnically-based business associations that could provide these kinds of translation and interface service free of charge by letting them know at their association meetings, by 37 5/31/01 FINANCE - BILL 010373 meeting with them regularly. The Dominican grocers, for example, is an organization that I've come to know quite well over the last few months, and they're willing and want to help to be an arm of government within their communities dealing with their association or other Latin-based organizations and neighborhoods from a business strip perspective. The same thing with a number of other Asian business associations. So I think you may have a wealth of people available and ready outside of government, that if you work with them and met them, could be kind of your conduit of information for the Streets Department, for Health. These are the departments that, for the most part, businesses have tough interface with, and that is: L&I, Health, the Parking Authority, those kinds of agencies. So I would make that suggestion that -- and I would help my office provide you with a list of people that we've met with already so that maybe you can reach out to them and bring them into the loop so that you have an opportunity to have a ready source of translation services and people who are from that particular background and perhaps would be 38 5/31/01 FINANCE - BILL 010373 more trusted by those particular merchants. I think the discussion also in this regard does bring to the fore what I believe is a need for an office of government that deals simply with immigration services, both immigration attraction and for the people who are here now to be able to do that outreach, not only from a business perspective but health, education, all of those kinds of services that we need to provide to people. So on those two accounts, I'd make those suggestions and thank you.
Thank you, Councilman. I know that what you're saying is correct because in most of the sessions that we have had with both the Dominican as well as the Korean business associations, they have used their own translators for us so that we did not have to call upon the one that we have access to in each one of those categories.
In the Northeast, for example, there's a Russian business association that, you know, provides translation services and other, I guess, cultural information about what people expect, are afraid of, concerned about when 39 5/31/01 FINANCE - BILL 010373 it comes to each individual group as a large group of Asian Indian business people. So there's a number of groups that are out there and willing to be a part of this.
Mr. Traylor, in your testimony, you indicate that PCDC's Small Business Revolving Loan Fund will be increased from $1.6 million to $3 million. In the current year, 18 businesses will receive loans under the program. 19 What is the amount of the average loan? 20
Mr. Jones or 21 Mr. Lenahan? 22 (Witnesses come forward.) 23
Good afternoon. I'm Curtis 40 5/31/01 FINANCE - BILL 010373 Jones, President and CEO of Philadelphia Commercial Development Corporation. In response to your question, our average loan size for that particular program is approximately 70 to $75,000. Now, we can go as low as $25,000 in that particular program up to -- we've done $400,000. But the average loan size is about 70, $75,000.
Are there any businesses in south or southwest Philadelphia who have received the loans?
Oh, absolutely. We have actually -- I would have brought today a breakdown by Councilmatic District.
We provide it usually every year, and we'll make sure that your office and the respective Councilmen get a breakdown of that. Just off the top of my head, in southwest, if you just consider from Market Street, there are a couple of deals on the books or at least being considered now. John, you might want to bring up some of those deals. 41 5/31/01 FINANCE - BILL 010373
John Lenahan, I'm Vice President for the Lending Department at Philadelphia Commercial Development Corporation. We've done a number of deals in South and Southwest Philly. We just had a grand opening, in fact, for a company called Room for Love last Wednesday -- it's not what it sounds like. It's a wedding gift type of operation. And we have funded about three or four businesses along Woodland Avenue. And we have a whole list of projects with where we list by fiscal year, by Councilmatic District the jobs created and retained and the number of outside dollars or the amount of outside dollars that we've arranged for financing for as well.
If you would be kind enough to send a list of that to the chairperson and she will distribute it to members of Council, we would all appreciate it.
We would like Year 25 and Year 26, please. 42 5/31/01 FINANCE - BILL 010373
For the fiscal year ending June 30, 2000, we actually far exceeded our goal in terms of CDBG-funded loans. We went over $3 million in both loan approvals and loan settlements. That's why we went back to Commerce and requested additional funding for the 2001 year. We weren't able to arrange it for 2001 because the preliminary plan had already been in. However, they indicated they would try and accommodate us for Fiscal Year 2002. That's why the amount has been increased.
It would be very helpful for us, as we try to help groups in our area, if we know. This has always been my argument with PCDC. PCDC makes decisions that for us become very political because consistently, we don't know who you're working with. And I always use the example of -- I had a lot -- within a quarter of a block, there were two lots in my area that were due to be fenced. So PCDC picked the one it chose as opposed to the one I chose. But it's a prime example that, you know, we have to make decisions that affect us being in 43 5/31/01 FINANCE - BILL 010373 office and that affect our groups. And if PCDC would work with us when groups want loans and grants, everybody benefits. But when you make 'em outside of that, then we feel it becomes many times that you make the political decisions and not us, and we get angry. And I say this every year.
Nothing's changed, and I say it every year, Mr. Jones.
So, again, we ask for those names. In fact, maybe I will, Mr. Kromer, mention this list first before we begin. We would like a list -- we received a list of the CDBG home funding projects, which is very, very helpful. Can we get a list of the names and addresses of persons and firms who received 108 loans? Everything just Fiscal 20 Year and 26 and the projects. That's number one. Number two, persons who benefitted in those two years from the basic system repair. And contractors who completed the works and how much they were paid. That's number two. 44 5/31/01 FINANCE - BILL 010373 And number three, minority contractors involved in this program. And I think that will do it. All righty. Thank you very much. Mr. Kromer, we would ask you now for the record to tell us again about the Year 27 Plan not having new projects and the Administration's position on that. And part B of that question is that we support the Mayor's blight initiative but feel that we cannot as Councilpeople delegate our responsibility, that responsibility entrusted to us by our constituents to make decisions without having their projects included in Year 27 Plan. Having said that, we have requested from District Councilpersons to give us a list of projects that they requested. Here this is. I would ask one of the Sergeant-at-Arms to hand this to Mr. Kromer. This includes those projects I have to date: Councilman Mariano, Councilman Clarke, Councilwoman Verna, myself and others. I will submit to you as I receive and we would hope that before we conclude our hearings on Monday that we have a response to those specific projects. All of 45 5/31/01 FINANCE - BILL 010373 it's stuff I'm sure you're that you're already aware of, but we would like to know -- we ask that you keep in touch with the District Councilpersons as you need to respond to that and certainly that you keep me, as chair, informed. So would you respond again to the change in Year 27 and how that changed and why.
Yes. And first let me say that the housing agency staff and I will review this information and any other material provided by Councilmembers carefully and will respond.
Yes, we'll be sure to include that as well. The basic issue that we're facing in the Year 27 is one of limitations of resources. It's a combination of two related activities that occurred. One is that outside funding, whether it be from prior years' unspent funds or from special HUD programs or for 108 loans, additional funding is no 23 longer available in this fiscal year to supplement the entitlement funds that we're receiving this year. 46 5/31/01 FINANCE - BILL 010373 And then, secondly, we've had a very productive program over the past years. We've had a lot of high-performing community development corporations, a substantial number of private developers who have worked effectively with neighborhood-based organizations, and a very extensive home repair program that's functioned year-round. The result is that the demand for funding is far greater than the amount of resources we have in the coming fiscal year. And, in fact, my point in circulating this list of the pipeline is just to indicate that of the development ventures that the City has already committed to by publishing them in the Year plan, which Council and the 17 Mayor authorized, we have a demand approximating 18 $44 million on the budget, and that's far in excess 19 to the amount that the Year 27 grant could provide. 20 That pipeline doesn't even take into account the 21 additional development ventures that have been 22 submitted today and that, understandably, 23 Councilmembers want to see happening during the 24 coming fiscal year. 25 So we've got to figure out how to deal 47 5/31/01 FINANCE - BILL 010373 with that limitation. And the response is, number one, that we need to find effective ways to tap other resources, and that's the point of this handout on the nine ways to create more resources for neighborhood reinvestment. And some of these opportunities are big. 7 million last year. The Philadelphia Housing Authority is proposing to commit $3 million to support the East Poplar sales housing development, which is one of the pipeline ventures. And some of the opportunities are not so big. But if we pursue all of them we're going to have a much more substantial budget during this coming year using the block grant and other resources. Now, that may be very well and good, but it doesn't address the question that I'm sure other Councilmembers have. What about the stuff we want to get done this year that's not mentioned in your pipeline and that is not published in the plan? What are we going to be about new development ventures? And my response is, in some respects, the relationship between the Administration and 48 5/31/01 FINANCE - BILL 010373 Council will be the same as it has been in prior years in which we've handled new development ventures effectively, and in some respects, the relationship will be different. There are two ways in which the relationship will be the same. Number one, as in the past, the Administration will not commit money upfront and set aside dollars for specific ventures. We stopped doing that in Year because 11 we found that developers were hanging on to City 12 funding awards and were no delivering results. And 13 in some cases, we found that completing a careful 14 underwriting of a development venture resulted in a 15 finding that a lower City subsidy could be provided 16 than what the developer had requested. 17 So as previously, we will make 18 commitments but we will not set aside a reserve 19 funding. We haven't done that for nearly a decade, and we have been able to deliver funding on time and on budget when called upon to do so. But secondly, and I think this is where we need to do some work and can get some work done, we need to, as the administration, make a commitment to include these development ventures and others 49 5/31/01 FINANCE - BILL 010373 which you'll be proposing as part of our agenda for the coming fiscal year.
And in the final version of the consolidated plan, to show you that these development ventures will be part of our agenda for neighborhood reinvestment during the coming fiscal year. Again, we've done that with past development ventures that you've brought in every year and those ventures have been funded for pre-development work, for acquisition, for site preparation, and for construction. We're going to do the same thing again this year. It won't be different from the process in the past. There will be some significant differences, however, in the way that we propose to support these development ventures during the coming fiscal year. Number one, we intend to make our funding decisions based on planning, on neighborhood planning that gets done in the communities where these ventures are proposed. And the Planning Commission staff, I believe, has met with all of you and your staffs to talk about the Planning Commission's role, new and expanded role, in planning for development investment. 50 5/31/01 FINANCE - BILL 010373 Why is this important? Let me cite just a couple of examples. One of the ventures that you mentioned, Councilwoman Blackwell, is the Third and Diamond venture that Councilman Mariano wants to see funded.
And we want to support that; it's an important rental housing development venture. But the proposal that we received earlier this year called for a substantial portion of that housing to be built within a Keystone Opportunity Zone, and in fact, on a parcel that the Commerce Department has been acquiring for some years for economic development. So the housing interest was not connecting with the economic development interest. It doesn't take much planning to sort out those issues and get us on the right track, and that's really all that we're proposing to do, to be a little more systemic in neighborhood planning in relating a neighborhood plan to funding decisions, to investment decisions. Another case in point, the Forgotten Bottom neighborhood in South and Southwest 51 5/31/01 FINANCE - BILL 010373 Philadelphia. We've talked about it for years. Most recently, we've talked about some repairs to the existing housing there, and we'll complete those repairs, we'll find the funding for those repairs. But if you look at the map of that area you'll see, as you're aware, that the Forgotten Bottom is adjacent to a Keystone Opportunity Zone and also adjacent to Tasker Homes, where the Housing Authority plans to make a very substantial investment of capital funding. Why aren't getting together all of the parties that need to be involved, not only to repair the houses that we want to repair but to create a master plan for that whole area that encompasses the Tasker Homes improvement, the Economic Development, and the KOZ, and a broader revitalization plan for the Forgotten Bottom neighborhood. Again, that doesn't mean we need to get into a five-year planning process, it's not that hard to figure out, but why don't we work together so that the Housing Authority isn't doing its thing in isolation from the other housing that we're focussing on, why can't we have a unified plan to support these investment decisions. 52 5/31/01 FINANCE - BILL 010373 Some of the other issues have already been raised to Council and presented in public as part of the Mayor's Neighborhood Transformation Initiative: the cost control issues, the plans to consolidate housing agency administration to lower costs. But the basic thrust would be the same: to support a relationship with Council so that the development ventures that Council wants to see done are integrated into the plan for the coming fiscal year and are processed for implementation. But I expect, based on those two examples and others, that if we follow an approach which combines the block grant with other resources that relates public investment to sensible neighborhood planning, we're going to see a lot more of an effect at the neighborhood level and create a lot more impact than we would if we were treating the block grants as the basic source of funding for all of these activities.
Mr. Kromer, I'm told that in Councilman Mariano's area, that the area that was a Keystone Opportunity Zone is no 24 longer. Just so it's obvious that you can check into that. 53 5/31/01 FINANCE - BILL 010373 But, certainly, I think that all of us on principle agree. If we reorganize Housing to make it more systemic, coordinate agencies like RDA and OHCD and PHA so that everybody -- so that we have an approved system with everybody, but certainly before that, we only request that Council feel that there's some level of inclusion so that they know how to respond to constituents who are always pressuring us about trying to get development and housing done in their areas. I think that's kind of bottom line. Everybody wants to streamline, everybody wants do it better, but they just want to be kept apprised of what that means and what that process is.
It seems to me that we can be very clear with Council about how these requests and other concerns that are brought up today and Monday can be related to the planning process and the implementation approach that I've described. We've done that in the past and I don't think it's too much to expect that we could do it again and publish that as part of the final document here.
Great. We understand that funding for homeless 54 5/31/01 FINANCE - BILL 010373 and special-needs housing has been reduced by 3.5 million last year. Can you explain that? Last year, there was $3 million for development, financing, for acquisition, rehab, or special-needs housing, and this year it is not listed.
I'd like to have Dainette Mintz, the Director of Special-Needs Housing, respond to that. I know she's finishing up a meeting across the street, but she should be here in a few minutes, and I believe the issue relates to the demand for development financing and the ventures that are currently ready to receive funding, but she will follow up on that.
Thank you. All righty. I understand that the AIDS funding has increased and, you know, there's been a reorganization of agencies. I haven't quite understood what that means, but so some new agencies have surfaced, some agencies that have been here since the beginning of time since I know that we've dealt with AIDS have kind of gone by the wayside. Can you explain what the new funding for AIDS means and how the change in how these dollars are 55 5/31/01 FINANCE - BILL 010373 allocated happens.
I think Scott Wilds can provide some more information on that.
We were fortune this year in getting a substantial increase in AIDS housing and funding. The increase was driven by the increase in caseload in the region. We administer HOPWA, which is a regional HUD-funded program. We got a substantial increase because the number of folks diagnosed with AIDS has gone up dramatically in the City and in the region in the last two years. We've done a couple of things with this increase. We have supported development construction funding for new housing units. We did a request for proposals and we have decided to fund two construction ventures with some of the increase. The other amount of the increase is 56 5/31/01 FINANCE - BILL 010373 going to set up a new rental assistance venture that will be aimed at folks who are healthy still and are working but can only work part-time and need additional small amounts each month to meet their existing rents. There are a lot of folks, we've been told, that are right on the edge. They work, they can sustain an apartment, but if they get sick or out of work, their worlds just disintegrate. And these new funds will be used in part to fund assistance to keep them in their existing apartments. That is something that we obviously have to have this approved. We will go to HUD and we hope to get it approved this summer. It's based on a model, Oakland, that's been in operation about two years.
Thank you. I'll ask two questions and then defer to my colleagues, who are getting impatient with me asking so many. How well is the neighborhood strategy working per the Mayor's executive order, whereby 50 percent or more of economic benefit of CDBG-funded programs go to immediate and surrounding 57 5/31/01 FINANCE - BILL 010373 neighborhood people?
The Office of Housing and Community Development provides regular reports on the neighborhood benefit strategy as it affects local employment. And I would say that the results are not what we would like to see in terms of a commitment to return half of the economic value of the development venture to the community. During recent years, the number of construction ventures that have been built by the building trades has increased substantially, and the involvement of the building trades is almost complete across the board in the housing production programs. For various reasons relating to the history of the building trades over the past decade, the number of Philadelphia neighborhood residents who happen to participate in those construction ventures does not give us the level of participation that's called for in the neighborhood benefit strategy legislation. There are only two ways of addressing that situation that I can think of. One is to step up the apprenticeship programs and the process for bringing more neighborhood residents into the 58 5/31/01 FINANCE - BILL 010373 building trades, and I know some of the trades have done an excellent job in advancing that goal, but clearly, we're not where we need to be. And the second opportunity is to consider mixed labor forces on some construction ventures. And that has happened in the past. It's not really happening now, but if it is possible to make that happen, then we will have a bigger opportunity for more neighbor participation, but we don't -- we are not where we need to be in terms of the neighborhood benefit strategy.
I think that single issue and that of the cost of housing rehabilitation are the two variables that will make a big difference in what projects we get done.
My final question for this round is, would you explain the difference in Section 108 funding between the 15 million allocated toward downtown development and the repayment of 14.212. What is our borrowing capacity for economic development versus housing?
The borrowing capacity for Section 108 is five times the amount of the 59 5/31/01 FINANCE - BILL 010373 community development block grant entitlement. This year, the entitlement is approximately 72 million, so we have nearly 400 million in borrowing capacity. Some of that capacity has been used to support economic development activities. And in the case of economic development, the 108 funding is borrowed by the City and then loaned to private developers. In each case, the private developer pays back the City and the City pays back the federal government. There is no loss of entitlement funds on the City's part. The situation with respect to housing 108s, the use of Section 108 for housing-related activities is different. As I mentioned, the biggest beneficiary of the housing Section 108 financing was the Logan Triangle area. Every year for an extend period of years, we borrowed $3 million in Section 108 funding to fund Logan relocation activities, and there was no private developer or no other source of payback for that funding. And so the funding has been paid back through a reduction through a commitment from subsequent years' community block development grants. 60 5/31/01 FINANCE - BILL 010373 And so the Section 108 loan repayment line items that you see in the Year 27 Plan on the budget pages reflect the repayment of those housing-related 108 loans that supported the Logan relocation, but also a variety of other housing production and preservation activities.
Good afternoon, Mr. Kromer. I'd like to go back to what the Chair laid out and I'll be getting some information to her as well. With regard to Year 27 and some of the differences, the Chair mentioned in caucus this morning at our Council session about the need to get information in about projects that members had an interest in, and I was trying to understand -- and she gave every piece of information that she had, which she admitted was not a great deal -- as to why this was the circumstance or the situation this year as compared to previous years. And I was somewhat perplexed by that as well. And I know that you alluded to it earlier, but I really don't understand why it's this 61 5/31/01 FINANCE - BILL 010373 way. And then the Chair handed you an envelope and other members have things in it. We're kind of down to the wire and it seems like, you know, folks are trying to get in the lottery line before o'clock. 6 Can you explain that? 7
Yes. There's really no 8 necessity for Councilmembers to feel pressured to submit a list of development ventures. We've got time to discuss what each Councilmember would like to see included in the Year 27 Plan. What's a little bit different this year is --
I'm sorry to cut across you. In the past, was it the case that they were already included?
No. In the past, there was an informal process in which I met individually with most of the Councilmembers that had community development block grant issues and interests and talked about what was proposed in the plan and talked about what the Councilmember wanted to see. No formal agreements were made at that time, but there was an opportunity to provide a little exchange of information. 62 5/31/01 FINANCE - BILL 010373
That hasn't occurred this year in part because of the schedule being a little tighter this time than it was before. And so I think the request for Councilmembers to --
What do you mean "tighter than it was before"? Have we not been around?
Well, usually we've had a little more time between the publication of the proposed plan and the scheduling of the Finance Committee hearing. It's just happened that way and --
Was there a problem at the print shop or something or --
No. And I don't think the change in the schedule really presents any problem. We've still got time to talk over these issues and any others that Councilmembers want to bring up. And as I said --
Maybe what I'm trying to understand then is, how do you put 63 5/31/01 FINANCE - BILL 010373 together a plan if you don't know what the items that may or will be in the plan are? I mean, what is this document then?
Well, that's why the word "proposed" appears on the cover every year.
But after we vote on it, doesn't it change from proposed to final?
Only after Council reviews and we have some discussion and, in many instances, some agreement on what the final plan will look like. That's what this is all about.
Okay. So let's say the bill comes out next week, gets voted on on the 14th, what happens then?
As in past years, the final consolidated plan would be submitted as the City's application to HUD but -- 64 5/31/01 FINANCE - BILL 010373
Well, it would be this document with any changes, additions, deletions, corrections that the Administration and Council agree should be a part of the plan, just as in past years.
Okay. You made reference earlier to some Planning Commission meetings about developing plans for different neighborhoods. I didn't catch all of that or --
Well, I wanted to say that one of the difference that is proposed for the coming fiscal year that's somewhat different from prior years is that the goal will be to achieve a consistent relationship between neighborhood plans and public investment in neighborhoods. In the past, there has been some relationship, and in many cases a great relationship, but it hasn't been consistent or systemic. 65 5/31/01 FINANCE - BILL 010373 I said that I believe that every Councilmember has had some communication with Maxine Griffith and her staff about the nature of that neighborhood planning, some elements of that planning. And I believe the staff person from the Planning Commission is here if there are any questions about that process.
Okay. Yeah, I have not experienced that process, but I'm looking forward to it. So at the moment, what can you tell me about the housing proposal in Roxborough that I think was funded last year, for a commitment of funding last year. Is that the 4200 Mitchell?
And what projects or plans do you have so far for the district for Year 27?
Includes Mitchell street 66 5/31/01 FINANCE - BILL 010373 venture nut what about for this application which is the Year 27 application what can you tell me about that proposed plan in terms of its coverage of any projects in the 4th District?
Well, as I said before, I can't tell you that we're going to reserve or set aside funding, and we haven't done that in the past. I can tell you that there isn't enough money in the Year 27 budget to fund new development ventures in any district using the block grant alone, and that we're going to have to work to combine the block grant with other resources in order to support these ventures and any other ventures that Councilmembers want to see implemented.
Well, how much is the block grant? Is that the 88.924?
And block grant entitlement is about 72 million. It's the first line there.
Right. And then you probably have some program income.
From CDBG-related but, again, if you look at all of the other --
Okay. And you're saying that out of that, there's not enough money to do any projects?
Well, if you compare that to the 44 million in expected funding required just to support what we previously agreed to and the demand for --
Oh, you're saying that you need Year 27 money to add on to this -- 68 5/31/01 FINANCE - BILL 010373 it's a new term that we got today, the pipeline.
All of these projects need additional funding to get completed.
In part and from other resources as well. I had mentioned PHA as a funding source and PHA enters into the picture in a number of these line items as a significant funding resource.
No, it's not, but we can break some of this out based on what we know now.
All right, that would be helpful. So let me just make sure I understand. So you're saying then that because of the projects that are in the pipeline, there is no money that you 69 5/31/01 FINANCE - BILL 010373 can identify at the moment in Year 27 for anything new because we have to fund or finish funding all of the stuff in the pipeline. Is that what you're saying?
Not really. I mean, that would be the way to look at it if the block grant were the only resource, but we can't look at the block grant as the only resource. I think the way I would express would be to say that we can't fund housing preservation programs, the pipeline, and new ventures all together with just the block grant funds; there's not enough in the block grant. We've got to expand our resource base if we're going to do all of these things, which I believe we all want to do.