Thank you, Commissioner. So if Public Property is now going to do these agreements with OHCD, how is that working? Walk me through the process for renewals and for new ones. COMMISSIONER SCHLOTTERBECK: If somebody wants to apply for a garden agreement, they just contact us.
So who's -- John's going to be the point person on that? COMMISSIONER SCHLOTTERBECK: Yes.
So the application goes to John, OHCD signs off on it? COMMISSIONER SCHLOTTERBECK: I don't believe OHCD has to sign off on it. 171 6/7/10 - HOUSING COMMITTEE - RES. 100379
Okay. No, but you said something around the value. It goes to -- COMMISSIONER SCHLOTTERBECK: No. I was trying to clarify the two issues.
Okay. COMMISSIONER SCHLOTTERBECK: Going forward, we thought it would be simpler not to have people apply through the VPRC process; it takes more time.
Mm-hmm. COMMISSIONER SCHLOTTERBECK: What has already gone through that process and has -- an appraisal happens; that's not something that I'm involved in.
Okay. COMMISSIONER SCHLOTTERBECK: It's more of a function of the process of VPRC.
Okay. COMMISSIONER SCHLOTTERBECK: That's what I was trying to clear. 172 6/7/10 - HOUSING COMMITTEE - RES. 100379
I think one of things that would be important -- and I know I was working with VPRC on this -- was the whole issue of when -- how is Public Property then going to conduct due diligence on the urban agreements when they get renewed? COMMISSIONER SCHLOTTERBECK: Well, we were going to work with the Office of Sustainability; and, actually, they were going to partner with us, so most of it would fall back on them.
So they're going to do the site visits to make sure -- COMMISSIONER SCHLOTTERBECK: Mm-hmm.
-- people are in compliance -- COMMISSIONER SCHLOTTERBECK: Absolutely.
-- to their urban garden agreement? COMMISSIONER SCHLOTTERBECK: 173 6/7/10 - HOUSING COMMITTEE - RES. 100379 Absolutely.
Do they have the staffing for that? COMMISSIONER SCHLOTTERBECK: I believe they do, yes. You know, I wasn't in the meeting. John took them directly with those folks, but yes -- (Indiscernible; parties talking over each other.)
Who runs the Office of Sustainability? I don't even remember what -- COMMISSIONER SCHLOTTERBECK: Katherine Gajewski.
Pardon me? COMMISSIONER SCHLOTTERBECK: Katherine Gajewski.
Now I know as much as I did before. Thank you, though. COMMISSIONER SCHLOTTERBECK: I'm happy to get back to you with how it's going to work; I'm happy to do that. 174 6/7/10 - HOUSING COMMITTEE - RES. 100379
Yeah. I mean, again, we -- I'd like some recommendations in terms of how do we do that process -- COMMISSIONER SCHLOTTERBECK: Okay.
To facilitate but at the same time have some accountability as it relates to those. COMMISSIONER SCHLOTTERBECK: Okay.
I know the Chair had asked you about the appraisals, a discussion we've also had. So given the discussion we've had prior, how are you guys handling appraisals when they come higher, in response to some of the issues? COMMISSIONER SCHLOTTERBECK: We have recently done a broker program pilot. And then we did -- we have three Council Districts that we're doing the online bidding process. And we haven't gotten appraisals. The market is 175 6/7/10 - HOUSING COMMITTEE - RES. 100379 dictating the price.
Yeah, but on those properties where we've seen high appraisals, what's your process if an appraisal comes in with comparables that are like what we've been talking about here prior to -- COMMISSIONER SCHLOTTERBECK: I actually haven't run across that yet. Remember, I -- if it's through the VPRC process, those appraisals are done through OHCD, not --
Thank you very much. We would like a report on this Office of Sustainability. I don't know which -- COMMISSIONER SCHLOTTERBECK: I'm happy to do that.
Thank you. And how -- and whose role they 176 6/7/10 - HOUSING COMMITTEE - RES. 100379 take -- COMMISSIONER SCHLOTTERBECK: I'm happy to do that.
And how it changes things. Thank you very much. COMMISSIONER SCHLOTTERBECK: Sure.
And disposition procedures is on our -- I assume, with adjacency, you're willing to work with us for -- and not dispose of a public piece of property if we're developing the whole area. COMMISSIONER SCHLOTTERBECK: That goes without saying.
Yes. COMMISSIONER SCHLOTTERBECK: My role is never to interfere with any development.
I'm sure. Is there a new disposition program that you're undertaking? Is this 177 6/7/10 - HOUSING COMMITTEE - RES. 100379 what you're talking about with this Office of Sustainability? Then we'll wait to here with that.
Your pilot. She's confused. COMMISSIONER SCHLOTTERBECK: Well, the pilot program that we were talking about, we sought permission from three Council Districts. Met with the Councilpeople beforehand and got their buy-in, and then they understood what the program was and how it would work.
Give us more details of what that program is. COMMISSIONER SCHLOTTERBECK: It's -- primarily, we targeted rowhomes, you know, middle of a row, like a house in the middle of a row that was a vacant 178 6/7/10 - HOUSING COMMITTEE - RES. 100379 lot. And we ran the addresses past each Councilperson, and they gave us permission to put them on the website and to solicit bids. And it's been very successful. They're all red-zoned residential, so as not to -- you know, it doesn't mean that someone can't come back and try to go through another zoning process, but that's a hearing that would take place, you know, in another venue.
Thank you. In which districts was this pilot program? COMMISSIONER SCHLOTTERBECK: Council President, Darrell Clarke, and --
DiCicco? COMMISSIONER SCHLOTTERBECK: And Frank DiCicco, yes.
Which brings up a question for me. 179 6/7/10 - HOUSING COMMITTEE - RES. 100379 COMMISSIONER SCHLOTTERBECK: Mm-hmm.
It seems to me that in areas where there is more marketability, greater value in real estate, that we get innovative, that we get creative, that we think outside of the box, that we, you know, try new and different things. And when it comes to distressed areas -- without using "the lack of priority"; I don't want to say that -- it just doesn't -- we just don't get creative. And that's unacceptable, I want to tell you now. The way neighborhoods get hot, the way neighborhoods become viable, the way neighborhoods take on value is when government goes in first, establishes a beachhead, shows that it can be done, and then the private sector follows. Now, yes, Center City is a no-brainer; you know, those properties will probably find takers in the natural 180 6/7/10 - HOUSING COMMITTEE - RES. 100379 course of things. It is the help of government that makes places like the 3rd District and the 4th District and the 7th District and the 9th District viable. And so, I don't understand how, you know, all the time, you know, the best things happen in those districts, and we, you know, and we out in the regular communities representing working-class people wind up without innovation. I don't understand why they were chosen over us. COMMISSIONER SCHLOTTERBECK: We just picked areas that we --
There's no 18 "just" -- not those three districts. That's not -- COMMISSIONER SCHLOTTERBECK: Actually --
-- you're pulling them out of a hat. COMMISSIONER SCHLOTTERBECK: Actually, when we worked with the Council 181 6/7/10 - HOUSING COMMITTEE - RES. 100379 President, she was reluctant to have us do anything creative in Point Breeze. So, I mean, there's dueling opinions about this.
It is not coincidental to me -- at least I don't -- I won't buy that, that DiCicco's district, Darrell's district, and our president's district, all of which represent higher-income areas -- COMMISSIONER SCHLOTTERBECK: That's true.
What they have in common is that they touch Center City property values. And for us to use our resources there, when the private sector can just as easily step up to the plate because of those values, it seems to me a little bit discriminatory, I mean, quite frankly. COMMISSIONER SCHLOTTERBECK: Well, we just wanted to see how it went, and we were --
Well, we 182 6/7/10 - HOUSING COMMITTEE - RES. 100379 could have saw -- COMMISSIONER SCHLOTTERBECK: -- on your doorstep.
We could have saw how it went in the 4th District, we could have saw how it went in the 7th District. COMMISSIONER SCHLOTTERBECK: Sure.
You didn't pick 'em out of a hat; you picked 'em out of rational, and I want to know what that rationale was. COMMISSIONER SCHLOTTERBECK: I don't really know what the rationale was.
Madam Chair, I just wanted to add, again, and I think this is a broader alphabet discussion. I think it's really important. I think what we're seeing is a need to liquidate properties, 'cause we want to bring in money on the short term, 183 6/7/10 - HOUSING COMMITTEE - RES. 100379 and I'm all for there are certain parcels that we need to get rid of. My only concern, and I've said this before; I've said it to Terry and to Deborah and to the Commissioner -- is where we have the greatest value is where we have to ensure that we are building for the reality of the City. And if we let those valuable parcels go without looking at the need to ensure affordable and access to those neighborhoods, we're going to, as a city, concentrate poverty in districts like mine. And I think that this is why it is so important that this administration articulate a housing and a community- development strategy that ensures that we are building for our -- the reality of our poverty. And so, my concern is, when ewe sell the highest value, those are the places where we need to ensure that people have access, that Philadelphians have access. 184 6/7/10 - HOUSING COMMITTEE - RES. 100379 And that's where my concern is as it relates to your point, Councilman Jones. If everything that's affordable is going to be in my district, then I'm always going to represent a district that is not diverse and does not allow for some market-rate accessibility. And that's a concern that I have, because this city, 36 percent of our children live in poverty, percent 12 are in poverty. That is our reality. 13 When we're building for 14 everybody who's coming in and not 15 realizing that these are the people that 16 we have to take care of, we're going to 17 have sections of the City that have high 18 concentrations of poverty and problems. 19
On that 20 note, well done and well put. 21 How many deals were done in the 22 1st District last year for the 23 Redevelopment Authority and OHCD? 24 COMMISSIONER SCHLOTTERBECK: 25 You're asking me? 185 6/7/10 - HOUSING COMMITTEE - RES. 100379
No, I'm asking Miss McCulloch. How many deals were done in the 1st District last year? (Ms. Gillen comes forward.)
Terry Gillen. By "deal," you mean a sale of land for an affordable housing project?
And while you're getting that, I want to know: In the 1st, the 5th, and the 2nd, in those districts, how many deals were done?
And then I want to know how many were done in the 4th and the dollar values.
Okay. MS. McCOLLOCH: I just want to make sure I -- you just want affordable housing ventures in each of those 186 6/7/10 - HOUSING COMMITTEE - RES. 100379 districts.
I want every transaction done in the 1st, the 2nd, and the 5th compared to my district, the 4th. Now, probably other Councilpeople would want that as well. MS. McCOLLOCH: Okay.
Okay. Well, you understand you're going to get through me anything that goes through that RDA; you're not going to get PIDC and you're not going to get Public Property from me. So I'm just pointing out to you that --
All right. Matter of fact, I don't see why we can't ask you to get it all and do a matrix to give us where things are, because I'm -- I know we did very little. 187 6/7/10 - HOUSING COMMITTEE - RES. 100379 MS. McCOLLOCH: Actually, Councilman, you had requested this last week of me, and we're preparing it to be given back prior to the Con. Plan hearing.
Thank you, Councilman. Are there more questions? (No response.)
Because we are going to continue this hearing. But if there are no questions, then it is time for us -- Deb, you might as well stay -- to consider Ordinance 19 100159. Will the clerk read the title of Ordinance 100159.
An ordinance 22 amending Chapter 21-1100 of the Philadelphia Code, entitled "Community Development," by amending Section 25 21-1108, entitled "Economic Development," 188 6/7/10 - HOUSING - BILL 100159 to increase the percentage of funds that must be allocated to economic development, all under certain terms and conditions.
Thank you very much. Miss McCulloch, would you like to present your testimony? MS. McCOLLOCH: I'm not sure if Councilmembers received a copy of my testimony in advance or did not. They did? Okay. Then you don't need it.
Thank you. Feel free to present your testimony. MS. McCOLLOCH: Good afternoon, Councilwoman Blackwell and members of the Committee on Housing, Neighborhood Development, and the Homeless. I am Deborah McCulloch, Director of Housing, and I am here on behalf of the Nutter Administration to testify on Bill No. 24 100159.
Excuse 189 6/7/10 - HOUSING - BILL 100159 me, one moment, Miss McCulloch. Let me say to those who are leaving the room that we're going to continue the rest of the hearing until June 16th, at 1 o'clock. So we'll ask all of those who are here now to be present then, because some people are preparing to leave. Thank you. Continue. Excuse me, Miss McCulloch. MS. McCOLLOCH: This bill would mandate that at least 5 percent of Community Development Block (Grant CDBG) funds be allocated to economic development for mixed-use projects on or around commercial corridors. As drafted for Year 36 -- that's Fiscal Year 2011 -- that 5 percent requirement is more than $3 million based on the new CDBG entitlement of $55.3 million and projected program income of $13.1 million. The City supports the concept 190 6/7/10 - HOUSING - BILL 100159 of mixed-use residential and commercial development on commercial corridors. In the past, the City has supported mixed-use developments on commercial corridors. OHCD has supported the residential portion, and the Commerce Department has supported the commercial portion. For example, the Nicetown Court development on Germantown Avenue combines commercial space on the ground floor with affordable rental housing units above. The Allegheny West Foundation recently completed a smaller mixed-use development on Lehigh Avenue, that combines retail space on the ground floor, with four apartments above. In the past, the State's MUFI, (Mixed-Use Financing Initiative) Program, which was part of the Pennsylvania Housing Finance Agency's Homeownership Choice Program, provided funds to support mixed-use development. Local MUFI projects have been carried out by 191 6/7/10 - HOUSING - BILL 100159 Allegheny West, People's Emergency Center CDC, Mt. Airy USA, and New Kensington CDC. Because of the State's budgetary constraints, the PHFA is no longer funding MUFI or other Homeownership Choice activities. The Administration and Councilman Jones, the prime sponsor of Bill No. 100159, have had very productive discussions about the benefits and funding possibilities for mixed-use development. Councilman Jones has prepared an amendment to Bill No. 100159 that postpones implementation of the 5 percent requirement until Fiscal Year 2012, CDBG Year 37, and clarifies the basis on which the 5 percent calculation will be made. Funds not expended in any fiscal year for mixed-use development, as outlined in the amended bill, will be available for reprogramming for housing and economic development activities. Projects will be selected through a 192 6/7/10 - HOUSING - BILL 100159 request-for-proposals process. The Administration supports this amendment. In the interim, OHCD and the Commerce Department will support a pilot program funded at $1 million in CDBG resources in Fiscal Year 2011. To fund this pilot program, the Administration will present an amendment to the Year 36 Consolidated Plan at the Finance Committee hearing on June 9th. Assuming this amendment is adopted, the City will issue a request for proposals for mixed-use development on commercial corridors in FY 2011, using the resources of this pilot program. I have discussed this approach with the bill's sponsor, and I believe that he is supportive. Mixed-use development is a concept that we all support. I'm happy to answer questions you or other Councilmembers may have. Thank you.
Thank 193 6/7/10 - HOUSING - BILL 100159 you very much. Are there those who would want to testify on this bill? Rick Sauer, Executive Director of CDCs, is here. And James White is here. We invite them to testify. (Mr. White comes forward.)
Thank you, Mr. White. Thank you, Miss McCulloch. Thank you for your patience.
Good afternoon, Madam Chair and distinguished members of the Council. Thank you for the opportunity to testify. My name is James White, and I am the policy coordinator of the Philadelphia Association of community development corporations. PACDC is a citywide association of more than 80 community development corporations and other organizations that have extensive experience developing residential and commercial properties, including mixed-use developments. 194 6/7/10 - HOUSING - BILL 100159 We would like to applaud Councilman Jones and the Committee on Housing, Neighborhood Economic Development and the Homeless for providing a public forum to discuss the creation of a local dedicated funding source to advance mixed-use development projects. As you know, many properties located within our neighborhood commercial corridors consist of street- level store fronts, with residential apartments based in the upper floors. Rehabilitation of these mixed-use buildings as well as development of new ones offers a key means of stabilizing and revitalizing commercial corridors and surrounding residential neighborhoods. Such developments attract and retain businesses, providing increased job and housing opportunities for residents near public transit. Communities that stimulate -- these also stimulate an 195 6/7/10 - HOUSING - BILL 100159 increased investment and strengthen our city's tax base. Mixed-use developments also contribute to community safety because they bring a double presence to a once-vacant space, the store and the residents of the apartments upstairs. In response to the challenge our members face accessing financing for mixed-use residential or commercial projects, PACDC convened key stakeholders and developed the concept that led to the creation of the Pennsylvania Housing Finances Mixed-Use Facility Financing Initiative in 2003. This initiative is designed to create a funding mechanism to help bridge gaps that often exist between housing lending and commercial lending and that may negatively impact the availability of financing for mixed-use developments. Through this initiative, PHFA has committed nearly $12 million in funding that has leveraged $120 million 196 6/7/10 - HOUSING - BILL 100159 to support mixed-use development projects throughout the Commonwealth, including five projects sponsored by CDCs in our association. While PHFA has not had the resources to support any of their Homeownership Choice programs, including MUFI, for the past two years, it is our understanding that this is one of their priorities, to re-fund the MUFI program. PACDC supports the goals and intent of Bill No. 100159 to create a local dedicated funding source to advance mixed-use development projects. 75 million in CDBG funds would be redirected from during Fiscal 2011. It is our understanding that the amendments have been agreed to that will address this issue by launching a pilot program in FY 2011, with the implementation requirements in the bill 197 6/7/10 - HOUSING - BILL 100159 taking effect in FY 2012. We fully support such an amendment. We believe that the creation of a dedicated funding source for mixed-use development will help develop a pipeline of projects and give the City an opportunity to leverage additional matching resources from PHFA's MUFI programs when it becomes refunded and also from private lenders. PACDC's members are engaged in housing and economic-development activities critical to sustainable neighborhood revitalization and would welcome the much-needed resources this legislation will bring to their communities. We look forward to the opportunity to work with Council, the Administration, and other stakeholders around the implementation of this new dedicated funding source to advance mixed-use development that will strengthen the City's neighborhood commercial corridors and address 198 6/7/10 - HOUSING - BILL 100159 residents' needs. Thank you.
Thank you very much. Mr. White, let me commend you for the great job that you do and for your commitment and diligence as well.
Only to echo the Chairwoman's comments. And I look forward to and always engaging in an ideas exchange with you because what it tends to do is make our ideas better. And when we look at legislation, sometimes we don't recognize the unintended consequences on CDCs and people that are doing the actual work. And by coming to us and exposing us to those unintended consequences, the 199 6/7/10 - HOUSING - BILL 100159 end-product is always better, and I just want to thank you for it.
Thank you. We are waiting for two members of our committee. For those of you who are in office, who just stepped out, please come back. We need members of our committee so that we may report out Bill 13 No. 100159.
I just wanted to thank -- also, Madam Chair, while waiting for our members, this important piece of legislation and why it's so important. One, as a young boy, I grew up in West Philadelphia on a commercial corridor near 60th and Market, a border that we now share. And one of the childhood memories I have is visiting a friend of mine who lived on 60th Street, who lived above the corner store that we 200 6/7/10 - HOUSING - BILL 100159 used to frequent. So whenever his mother used to send him to the store, he would right down the steps, go right around the corner, go right in and buy the bread, butter, eggs, and milk. Well, somehow, during the '60s, '70s, that trend changed, and people began boarding up the top part of their properties as safety hazards, and it took away from quality of life that we shared in that West Philadelphia neighborhood. Later on, as I became the president PCDC, Philadelphia Commercial Development Corporation, we did a study; we did a study of one block in Philadelphia, Germantown Avenue. And one of the things that struck out at us, Madam Chair, was the fact that the further you went up Germantown Avenue towards Chestnut Hill, the higher the number of occupied commercial properties above. There was a correlation between second-floor occupancy and viability of the strip. 201 6/7/10 - HOUSING - BILL 100159 So when we dug into it further, it was because of some simple truths. The more people you have in density around businesses, the more customers you have. The perception the security is there because there's more people. The less roll-down gates, the less kind of imprisonment that some commercial corridors feel, because, at 6 o'clock, the roll-down gates go up, and then there's a sense of abandonment and a sense of fear. I believe this legislation will go a long way in changing that condition, and I want to thank all of the members of this committee for considering it.
Thank you very much. I know there's another committee. Miss Robinson, we gave you a chance. We'll give you a moment till someone comes in, because we do have another committee that has assembled. 202 6/7/10 - HOUSING - BILL 100159
Right, I understand that, Madam Chair, and thank you for very much for the opportunity.
I neglected to mention one thing in my testimony in the past. I want to make sure, with all of this development, that you have community participation. I neglected to say that; it's very important. We have hired you all as our representatives, but you don't know everything that goes on in the community until the people in the community tell you. I would just appreciate it if with each one of these developments, before any letter is sent from any of our representatives, that they know that a community meeting has been held in their district by real constituents of their district. 203 6/7/10 - HOUSING - BILL 100159 And I appreciate your time.
Thank you, Miss Robinson. And, certainly, we agree. And it is the law that we have to have community participation.
And so, certainly we agree with that and concur. Thank you, Mr. Sauer, for being here. We see you back there. As soon as we get another member to come, we can have our vote. Thank you very much. We will conclude our hearing portion of this meeting and go into our formal stated meeting. * * * 204 6/7/10 HOUSING - PUBLIC MEETING
The Chair will now recognize Councilman Jones for a motion with regard to Bill No. 5 100159.
Thank you, Madam Chair. I move for the adoption of the amendment to Bill No. 100159, which has already been circulated to the committee members. (Motion duly seconded.)
It has been moved and seconded that the amendment to Bill No. 100159 be adopted. All in favor will say aye. Opposed? The ayes have it. And so, the amendment is adopted. The Chair now recognizes Councilman Jones for a motion with regard to this bill -- with regard to the amended Bill 100159.
Thank you, Madam Chair. 205 6/7/10 HOUSING - PUBLIC MEETING I move that Bill No. 100159, as amended, be reported out of committee, with a favorable recommendation and with a suspension of the rules as to allow for first reading at our next session. (Motion duly seconded.)
It has been moved and seconded that Bill No. 10 100159 be reported out of committee with a favorable recommendation, as amended, and also that the rules of Council be suspended so as to permit first reading at our next session of Council. All in favor will say aye. Those opposed? The ayes have it. And so, this bill is reported out. And we note that Councilman O'Neill left his vote on both the amendment and the bill. His vote is accept it and include it. As well as Councilwoman Maria Quiñones, who was in the chambers. We have your vote, Councilwoman. Yes. She 206 6/7/10 HOUSING - PUBLIC MEETING says yes on both the amendment and the bill. Bill No. 100160 will be held subject to the call of the Chair. Bill No. 100359 will be continued until June 16th, at 1 p.m. That is, again, 100159 has been reported out of committee with a favorable recommendation and a suspension of the rules. 100160 is held subject to the call of the Chair. And 100359 will be continued until June 16th, at 1 p.m. That concludes our deliberations. Thank you all very much. Some of you we'll see next Wednesday. And for everyone else, thank you very much. Thank you to the committee. (Proceedings end at 1:14 p.m.) * * * 207 C E R T I F I C A T E I HEREBY CERTIFY that the proceedings of the City of Philadelphia Council Committee on Housing, Neighborhood Development, and the Homeless are contained fully and accurately in the stenographic notes taken by me on Monday, June 7, 2010, and that this is a true and correct statement of same. __________________________________ JOSEPHINE CARDILLO Registered Professional Reporter (The foregoing certification of this transcript does not apply to any reproduction of the same by any means, unless under the direct control and/or supervision of the certifying reporter.)