COUNCIL OF THE CITY OF PHILADELPHIA PUBLIC HEARING AND PUBLIC MEETING BEFORE COUNCIL COMMITTEE ON RULES - - - Room 400, City Hall Philadelphia, Pennsylvania Tuesday, May 25, 1999 11:15 a.m. - - - BILL 990254 - Redevelopment of South Central Urban Renewal Area. BILL 990255 - Redevelopment of Pennsport Urban Renewal Area. (Full text of both amendments attached hereto.) PRESENT: COUNCIL PRESIDENT ANNA C. VERNA. Chair COUNCILWOMAN AUGUSTA A. CLARK COUNCILWOMAN JANNIE BLACKWELL COUNCILMAN DAVID COHEN COUNCILMAN JAMES F. KENNEY COUNCILMAN MICHAEL A. NUTTER COUNCILMAN ANGEL L. ORTIZ COUNCILMAN FRANK DICICCO COUNCILMAN W. THACHER LONGSTRETH - - - VINCENT VARALLO ASSOCIATES, INC. Registered Professional Reporters Eleven Penn Center, Suite 600 Philadelphia, PA 19103 (215) 561-2220 2 5/25/99 RULES - BILLS 990254 I N D E X Page Bill 990254 Noel Eisenstat, Executive Director . . . . . . 4 Philadelphia Redevelopment Authority Anthony Brown, General Manager, Hope VI. . . . 47 Philadelphia Housing Authority Raheem Islam, Executive Director . . . . . . . 50 Universal Community Homes Robert Totarro, Vice President . . . . . . . . 51 Penrose Properties Olivia Adams, Esquire. . . . . . . . . . . . . 65 Jeffrey Brown, Project Manager . . . . . . . . 80 Philadelphia Redevelopment Authority Tyrone Toliaferro, Webster Street Resident . . 103 Shelly Hunter, Christian Street Resident . . . 105 Reverend John Coger, Pastor. . . . . . . . . . 106 New Hope Temple Baptist Church Anna Biggs, Webster Street Resident. . . . . . 119 Deacon Clarence Everett. . . . . . . . . . . . 133 New Mt. Zion Baptist Church Joseph Anderson, Christian Street Resident . . 136 Lisa Gregory, 12th Street Resident . . . . . . 144 Claudia Gordon, Webster Street Resident. . . . 146 Ronald Watson, Webster Street Resident . . . . 147 Bill 990255 Noel Eisenstat . . . . . . . . . . . . . . . . 151 David Knapton, City Planning Commission. . . . 166 Richard Lombardo, City Planning Commission . . 170 Glenn Bryan, U of P Director . . . . . . . . . 174 City Community Relations Charles Newman, U of P Facilities Director . . 175 3 5/25/99 RULES - BILLS 990254 P R O C E E D I N G S
Thank you. Good morning. This is the public hearing on the Rules Committee. I would ask the clerk to please read Bill No. 990254.
An ordinance amending an ordinance approved December 14, 1971, as amended, which approved the Redevelopment Proposal, the Urban Renewal Plan, and the Relocation Plan of the Redevelopment Authority of the City of Philadelphia for the redevelopment of South Central Urban Renewal Area by approving the Tenth Amendment of the Redevelopment Proposal, the Tenth Amendment to the Urban Renewal Plan, and an amendment to the Relocation Plan, which provide inter alia for certain additional land acquisition of approximately 231 properties, provision of certain relocation services as required by law for the individuals, families, and business concerns which will be displaced and certain land use changes and updating the property rehabilitation standards, all as contained in the Tenth Amendment of the Redevelopment Proposal and the Tenth Amendment to the Urban Renewal Plan. 4 5/25/99 RULES - BILLS 990254
I believe I saw Mr. Eisenstat walk in. Is he here? Please approach the witness table. (Noel Eisenstat comes forward.)
Good morning, Mr. Eisenstat. Maybe you could explain to us and to people who are here about blight certification and what it's all about, please.
My name is Noel Eisenstat. I'm the Executive Director of the City's --
Try the other one, please. (Technical difficulties with sound 5 5/25/99 RULES - BILLS 990254 system.
Good morning again. My name is Noel Eisenstat. I'm the Executive Director of the City's Redevelopment Authority. This public hearing concerns an amendment to the South Central Urban Renewal Area and a specific redevelopment renewal plan that is being contemplated today. Council President, you've asked me in my capacity as the Executive Director of the Redevelopment Authority to explain the context of today's hearings. And if you would afford me a moment or two, let me give you a slightly broader context. This blight certification, this action, which would permit the Redevelopment Authority to acquire approximately 231 parcels and contemplates the acquisition of up to 150 buildings, including 51 occupied residents and three occupied commercial buildings, is being undertaken by the Redevelopment Authority on behalf of the development known as the Martin Luther King Hope VI Development. The Martin Luther King Hope VI 6 5/25/99 RULES - BILLS 990254 Development is a planned transformation of the Martin Luther King housing development. Part of the mission of Hope VI can be later explained by representatives of the Housing Authority, and I would explain that the Housing Authority has selected a joint venture known as "Uni-Penn" to serve as the developer of this plan. Representatives of the Housing Authority as well as both members of the joint venture team are here to address specific questions about the development, and I'm happy to answer questions about the mechanics of the blight certification. This is an area that has been deemed blighted by the City Planning Commission. This area has gone through extensive study by the Planning Commission as well as the Housing Authority. The Redevelopment Authority was asked to undertake this redevelopment plan as a result of the Hope VI planning and has done so. A series of community meetings have been held over the years. While I am sure there are individuals today in Council chambers who may have not attended any of those meetings, it is my understanding as well as that of Councilman 7 5/25/99 RULES - BILLS 990254 DiCicco from the district that the developers and PHA will be happy to continue to meet with residents both in the immediate area and in the impacted -- in the surrounding area concerning this. Today's action is a public hearing required by ordinance that would permit the Authority to proceed with the acquisition of the property that I have previously mentioned.
Do you have specific addresses of the 51 occupied properties?
I believe all the addresses -- yes, the specific addresses that are to be contemplated to be taken, which are a total of 231, are within the ordinance as introduced in City Council. And I believe that the ordinance 18 itself delineates those properties that are occupied, vacant, vacant structures, as well as residential or commercial.
I'm going to check with the material that was delivered as an attach -- it may not have been included within the bill. 8 5/25/99 RULES - BILLS 990254 I'm happy to review the file with the transmission that was submitted from the Redevelopment Authority to the Planning Commission and then to the Mayor's Office for submission. And if you do not have a copy of that attachment as part of the bill, I would be happy to circulate it today. Generally -- and I have not reviewed a copy of the bill as presented to you from the clerk's office -- the actual addresses should be attached for reference to the bill itself because those addresses have specifically been referenced by actions of the Redevelopment Authority and the Planning Commission in contemplation of this action.
Councilman DiCicco, do you have a list of the properties?
Would the developer happen to have those with him today? If you can make those available to -- or come to the witness table. And if maybe -- if you could at least give us the number of occupied properties that are part of the 231 properties that Mr. Eisenstat 9 5/25/99 RULES - BILLS 990254 spoke to.
Could you provide the committee with a list of information that you have, please.
We can have somebody photostat them now, if you will. Mr. Eisenstat, would you proceed with your testimony, please, while we're waiting for the information to be photostated.
Sure. Let me clarify one point I may have been confusing. The list of properties are specific in the ordinance; they do not delineate within the ordinance what is occupied or vacant. That is the document that is being photocopied at this time.
Mr. Eisenstat, I'm sorry, do you have copies of the two bills?
Because you continue to say for the record that the properties are delineated in the bills, and now your most 10 5/25/99 RULES - BILLS 990254 recent statement is that it just doesn't say which are occupied or which are not. You need to have copies of the bills. The bills make no reference to any particular properties. It talks about 231 properties, and short of -- and other than that, there is no 8 mention made of any properties, any addresses or anything else; nor do I see for the moment anything that makes any reference to any attachments or, for instance, an Exhibit A or something like that. This is all fairly boilerplate language regarding amending an urban renewal plan for both of these bills. There's no mention made of any specific properties addresses here.
I can't speak to the publication of the particular bill but I can assure you that the public notice that was published by the clerk's office and was in the newspaper did, in fact, include the addresses.
Well, I understand that and I'm very pleased to hear that, but we're now in the public hearing, and I don't have a list. 11 5/25/99 RULES - BILLS 990254 So it's very difficult to engage in this discussion, and for the moment at least, I have to ask you to stop saying that the bill 5 delineates what the properties are because I have the bills in pink, you now have them, and it makes no mention of properties.
Please proceed with your testimony, Mr. Eisenstat.
Thank you. The South Central Urban Renewal Area is generally bounded by Lombard Street on the north, Washington Avenue on the south, the Delaware River to the east, and the Schuylkill River on the west. This bill will authorize the Redevelopment Authority to acquire 231 predominantly vacant and vandalized buildings and lots to eliminate blight in the area from South 11th Street to South Broad Street, Kater to Kimball, as part of the Philadelphia Housing Authority's Martin Luther King Revitalization Project. The properties to be acquired will be developed through a combination 12 5/25/99 RULES - BILLS 990254 of new construction rehabilitation into affordable housing for low-, moderate-, and middle-income housing families. The Martin Luther King Plaza Revitalization Project is a major development being undertaken by the Philadelphia Housing Authority. PHA intends to demolish four current MLK Towers to eliminate blight and decrease the density on the public housing site. PHA and its partners plan to build new housing on the existing site and have the Redevelopment Authority acquire for rehabilitation and clearance most of the vacant and blighted properties in the surrounding community. The reuse will be for public housing with some market rate housing and supported commercial development. This project will be funded mainly from HUD Hope VI funds for the comprehensive revitalization of the Martin Luther King Plaza site, the surrounding community, as well as Community Development Block Grant funding. The acquisition consists of 150 buildings, 81 vacant lots. The 150 buildings include 51 occupied residences and 3 occupied 13 5/25/99 RULES - BILLS 990254 commercial buildings. The Redevelopment Authority's commercial relocation program provides resources, services, and payments to occupants who will be displaced as a result of the public taking. No families or individuals will be relocated until rehousing can be accomplished according to federal regulations and the Authority's policies and procedures. I don't know if you have any other questions about my testimony, but. . .
I don't know how many of the 51 homeowners are here, but for the record, can you please describe what the process would be as far as they're concerned.
Yes. Previously, the developers and PHA have held a number of public hearings on an informational basis, and some of these -- some of these discussions go back a number of years before the level of specificity which we are addressing today. This level of specificity has been developed over the last five or six months. But as it relates to this process preceding, the Redevelopment Authority would act 14 5/25/99 RULES - BILLS 990254 to acquire land in this case in a similar fashion as it has in other projects such as the Poplar Nehemiah and the Cecil B. Moore Nehemiah in North Philadelphia. That would require, after the appropriate passage and signage of this ordinance, that all property owners would be contacted by the Authority, to be noticed that an appraiser will be contacting them directly to review and inspect their homes and properties. Property owners will be given an opportunity to be present with the appraiser at the time of the inspection of the property. As it relates to relocation issues of occupied businesses and residents, the Authority's relocation staff would begin to contact individuals on a case-by-case specific basis after the ordinance is passed specifically to evaluate individuals' incomes, their current housing conditions, and their desires as it relates to relocating either within the area or other areas -- other places they may choose. Specifically, the Authority's staff must provide residents of the area -- the Authority and its relocation staff must provide 15 5/25/99 RULES - BILLS 990254 basically two things. Like any other property owner, that owner is entitled to the value of their home, the appraised value. And without going on much too long about that, there are a series of safeguards that will allow owners the rights of appeal, through the Common Pleas Court process, the value of their homes. In addition, homeowners as well as tenants will be provided the opportunity to receive relocation benefits, the relocation benefit process is a somewhat elaborate formula. But in general, I would indicate that at a bare min -- basically, relocate these who are homeowners will be provided an approximately $22,000 to $23,000 of additional support to make the available relocation as a way to assist in relocation, both to pay for the cost of a move and to pay for what might be the appropriate additional cost of finding a decent, sanitary and replacement housing unit. In this situation, I believe the Housing Authority and the developers will also work closely with the residents and the Redevelopment Authority staff to provide where -- 16 5/25/99 RULES - BILLS 990254 at all possible costs the ability for homeowners to be relocated into other home ownership developments within this project. In addition, renters will be provided a series of benefits. Tenants wishing to be located may receive first priority on waiting lists for government-supported developments as well as they may receive relocation benefits for a period of approximately 36 months of additional rent supplements as a part of the relocation benefits package.
Thank you, Madam Chair. And I appreciate the accommodation only because I have to leave in a few moments, although I expect to be back. Mr. Eisenstat, a couple quick questions. The magnitude of this project seems to encompass an area, from your testimony, Lombard on the north, South Street between Seventh and 13th. Washington Avenue on the south, the Delaware River on the east, and the Schuykill on the west. That's what's comprised in the South Central Urban 17 5/25/99 RULES - BILLS 990254 Renewal Area; is that correct?
That is the broadest scope of the urban renewal area, but I would define the scope of the development to the map in front of you, which is substantially --
It says South 11th to South Broad, from Kater to Kimball?
That would be a more appropriate description, yes. Mr. Brown will --
Could you move the easel so that everybody can see it.
All right, thank you. Now, why is it that as a result of the Hope VI opportunity to fully rehabilitate Martin Luther King is there this resulting impact on non-PHA residents in the broader community?
A cooperative effort was developed by the Housing Authority and the developers being Uni-Penn, a joint venture of Penrose properties and Universal Community Homes to develop a broader strategy that encompassed the area surrounding Martin Luther King. 18 5/25/99 RULES - BILLS 990254
Well, I understand that, but how many people are or were living in MLK?
I would have to refer those specific statistics to representatives of the Housing Authority who are here today.
The people who are being relocated out of Martin Luther King as a result of -- towers are coming down, is that the bottom line of that particular phase of this?
Towers are coming down, people need to be relocated. Now, are the PHA residents being relocated into some of the housing that's being -- either new construction or the rehab as a result of this particular project that you're talking about?
I believe that's the case. But, again, because of the phasing of that development, I would suggest that for specific relocation activities concerning the Housing Authority that you discuss that -- that you may want to question representatives of the Housing 19 5/25/99 RULES - BILLS 990254 Authority about their current status of the occupancy of the towers as they exist. Because my understanding is, some of the demolition of that is proceeding in the near future.
All right. So your primary role and function today is to talk about issues that are peripheral to the PHA, MLK Hope VI project, and you're dealing with housing rehabilitation or new construction in the area around MLK?
I would slightly recast the reason the Authority is here today, is to say that the developers and the Housing Authority as well as the Planning Commission have developed a plan utilizing the Hope VI grant and other public resources that require the acquisition of adjacent parcels in the surrounding area of Martin Luther King. And that for that, the Authority's powers of eminent domain might be exercised, and this is an ordinance that is permissive to allow that to proceed.
Okay. A couple last questions. You made reference either in your 20 5/25/99 RULES - BILLS 990254 testimony or in off-the-cuff remarks that there have been a number of meetings about this, although you indicated that there was a lack of specificity at that time; is that right?
The process of developing a cohesive plan for Martin Luther King has been going on for a number of years. There was a planning grant awarded to the Housing Authority, and a broad-based task force was set up. And it was only about a little more than a year ago that the Housing Authority, utilizing a request for proposal process, ultimately selected Uni-Penn. From there, the details of developing specific properties with specific addresses off-site to the ownership of PHA has been pursued by the developer and the Housing Authority.
Okay. How many meetings have taken place, where were they, and when did they happen?
I would specifically -- the Redevelopment Authority's only attended the last few meetings. And I did ask the developers yesterday and today to be available to delineate 21 5/25/99 RULES - BILLS 990254 the dates and time of their meetings, and they can recall some of them but do not have a complete list. I would refer you to -- the bulk -- the meetings that occurred were sponsored by the Housing Authority and the developer.
Okay. Madam Chair, thank you. I am going to ask to be excused for a brief period of time. If someone else can answer any of those questions, I would greatly appreciate it. Is the Housing Authority going to be here today?
Thank you, Madam Chair. And good morning again, Mr. Eisenstat. Could you elaborate a little bit more on the issue of relocation specifically for a homeowner who is in the designated area. Just elaborate a little bit about what you and I spoke 22 5/25/99 RULES - BILLS 990254 about on the 1300 block of Webster Street this morning when we met with some of the neighbors. We all understand the emotionally sensitivity of someone's house who may be taken, and there were a lot of questions this morning. A little bit to my surprise that more people didn't know about what was going on. And I apologized to the folks that I met with this morning and I assured them that going forward in this very long process, that at least through my office, that the community would be made aware of everything, and they will be a part of that process. But if you can explain that process a little bit about if I own home, whatever street it's on, and that house is one that will eventually be taken for the purpose of the revitalization and am given a fair market value for the house and am given the $22,500 or $23,000 in addition to that, we have moving expenses, we have some utility hookup expenses that are incurred by the Redevelopment Authority, explain how that person is not going to be put in a situation where they will begin to incur a debt that they didn't have presently at their present 23 5/25/99 RULES - BILLS 990254 address, that we're not going to relocate them in another house, and all of sudden, they're incurring a mortgage if they have a house that they're living in now that is debt-free.
The Redevelopment Authority is governed by the Federal Relocation Act. And from the broadest policy perspective, it is the goal of the Federal Relocation Act to provide sufficient resources -- simply money -- to allow individuals who may need to be relocated to have the ability to move into a comparable home that is decent, safe, and sanitary; meaning it meets the housing quality standards established by the U.S. Department of Housing and Urban Development. The crafters of the federal relocation law in its regulation realized that very often, when a public agency comes and acquires land for redevelopment, that that property that is being acquired may be undervalued, that it may be a three-bedroom housing unit but it may not currently meet all housing codes or it may be very difficult for a person to take the value of that home -- call it $15,000 or $20,000 -- and buy a 24 5/25/99 RULES - BILLS 990254 comparable home, a three-bedroom home for a three-bedroom home with $20,000 that is decent, safe, and sanitary and that is code-compliant, that has good working systems. And, therefore, the Federal Relocation Act is established to provide, as you, Councilman, have indicated, paying for the value of the home, all of those necessities to move: telephone hookup, cable hookup, deposits as well, as a formula that is somewhat complex but generally provides homeowners the additional benefits of approximately $22,000 or $23,000 per family. Having said that, there will be situations, and there have been situations in the past, where you may have a family that may need a four-bedroom or a three-bedroom home and that the value of their home may be so little and with the value of their home and the cost of the benefit of the 22,000 may not be sufficient. And in that case, it is determined by the Redevelopment Authority that, in fact, a relocatee cannot find a replacement unit with those resources. An additional payment may be made; that payment is known as a "last-resort payment," and that payment 25 5/25/99 RULES - BILLS 990254 will go above that $22,000 in situations where those resources alone are not sufficient to find a replacement house. That's the policy and the goal and the intent. Let me take a little bit about the mechanism. We understand that the mechanism is not one that is easy, pleasant or anyone looks forward to. And the Redevelopment Authority staff over the last few years has relocated approximately 130 or 140 families out through the last three or four years, and the Authority's professionally trained to conduct this type of work. The first thing is that I can tell that you this process is lengthy. While once an ordinance has been enacted, the Authority, under statute, can move in as quickly as 90 days to acquire occupied properties. Let me be very clear that that is not the intention of the Authority today. And by our past practices, at minimum, it should take nine months -- we would not anticipate having a -- just based on the volume of the number of units, the fact that we're now in the middle of summer and some people may not want to relocate in 5/25/99 RULES - BILLS 990254 winter, and we wouldn't think about relocating folks in the holiday season, I would assure you today that at minimum, this process of relocating the entire site would take at least a year.
And could you also explain, as you did this morning on Webster Street, if an individual or a family decided to locate and they wanted to stay within the community, in the one-, two-, three-square-block area from the present location, that those individuals would have a certain option to move within the neighborhood. And the result of that would be that they're always made whole; I mean, that's what I'm trying to get out of you. And I think you explained it. But I just want to reassure that no one will be put in a situation where the market value of their house, in addition to the financial incentives that are given for the relocation, if you don't have a mortgage today, you will not be put in a situation where you will have to incur a mortgage, unless you decide to do move up.
Correct. But that we'll also -- that the Housing Authority and the 27 5/25/99 RULES - BILLS 990254 developers are developing a mix of housing in this area, which includes new construction and rehabilitation. And those units should be produced in a way that should allow individuals who wish to occupy those units to move to those units. Some people may choose -- and it has been the case in Poplar and Cecil B. Moore that some individuals may take their benefits and move -- hopefully stay in the City and will sometimes move to other areas. There was a unique problem in the Poplar Nehemiah that those were first-time home buyers dollars, and we had a very difficult time rearranging the program to allow relocatees to live in the area around that area. But that restriction of the Poplar grant is not the case here, and that these individuals actually who may have to be relocated as part of this would actually receive first priority as being displaced by public action to be given an option to move in these houses by the fact that the Authority will be acquiring the property as a public taking.
And one more 28 5/25/99 RULES - BILLS 990254 question. The issue came up this morning also with a couple of individuals who have recently bought homes recently in the area in the last year or two, and they've been making some improvements to those properties, and although the property may have not been completely rehabbed, they are in that process and having spent money on those properties, and there goes a mechanism to, in addition to what the fair market value is, is to look at what the investment was and do what is necessary to allow those people to recoup that investment.
Let me explain that. Thank you for raising that. The purpose of the process here is to give homeowners and other property owners the opportunity to meet with the appraiser. Based on that meeting, property owners should feel comfortable showing their homes to the appraiser. Based on that, an appraisal will be forwarded to the Authority, and that will be the basis of an offer. Upon receiving that offer, homeowners or other property owners can request to see a copy 29 5/25/99 RULES - BILLS 990254 of that appraisal and may question it. They may, as part of the relocation benefit, obtain their own appraisal and negotiate with the Authority on that. Let me say that that can happen, but the bulk of the benefits will accrue to individuals being relocated through the relocation benefits, as I've discussed earlier. Individuals sometimes go out and make major improvements to their homes. Those improvements should have some impact on the value of their house. That does not mean that a dollar-per-dollar improvement will reflect an appraisal because the appraisal also considers the market value of the houses. So if someone puts, let's say, a $50,000 kitchen on a house, that doesn't mean the house is worth $50,000 more the day the kitchen is fixed, but the Authority will work with individuals and the appraisers concerning improvements made to their homes.
And one final question. And when the process begins on the relocation, and your department has a staff that will go out to meet with the individual folks and do a needs assessment, how does that occur? I 30 5/25/99 RULES - BILLS 990254 mean, is it by public notice, do you send a letter out first? And whatever it is, I would like for the record -- it's not the procedure, 'cause this is all new to me -- to be -- to have my office to be notified in advance of the meetings with the individual property owners.
The process is a two-pronged process. Generally, the Authority will conduct community meetings -- will participate in community meetings to answer general questions. But more importantly, the specific work about a specific individual is really a process where an individual staff person will work with an individual family in a case matter situation. You know, confidential information might be shared and that the process is really one that we contact in writing and by telephone and make numerous attempts to contact families and homeowners. Some individuals may opt to have minimal contact and take -- and decide to find their own homes on their own. Other individuals may feel -- may wish to rely more heavily on the 31 5/25/99 RULES - BILLS 990254 Authority in terms of actually arranging them to inspect other units and to be put in contact with other rental or home ownership properties.
Thank you. The Chair recognizes Councilman Kenney.
Thank you, Madam Chair. Mr. Eisenstat, the list that was given to us today, which says "Proposed Acquisition List Martin Luther King Plaza," includes -- do you have that?
I gave a copy to the clerk and I would appreciate a copy back, if I could refer to it.
Do you know how many properties are listed on this particular list at this time?
It is my understanding, 32 5/25/99 RULES - BILLS 990254 without counting the list today, last time it was counted, it was 231.
Okay. I did a quick perusal of the list and identified properties that are either -- for the most part I think 50 properties that are currently residential and owner-occupied -- occupied or owner-occupied.
51. Okay, I was a little off. And approximately or commercial properties that are either a bar or restaurant kind of thing, which are in use by individuals?
All right. So the bulk of the properties that are listed for taking are either vacant properties or vacant lots.
This is the final list that appeared in public notice as it related to the passage -- to the introduction of this ordinance. 33 5/25/99 RULES - BILLS 990254
This list could change either by a new ordinance adding new properties or by deletion of properties from the list.
So in order to do either a deletion or an addition to the list, there needs to be additional legislation?
It would not need additional to delete properties from the list.
So the universe of properties that all the people in this room, including us, are interested in at this point is on this list.
Okay. Has this list been available to anyone in the community?
Yes. The Authority received a series of inquiries from a series of attorneys as well as local residents, and the Authority's staff circulated this list once it was available, around the same time the bill -- before 34 5/25/99 RULES - BILLS 990254 or around the same time the bill -- the plan had proceeded to the Planning Commission.
Has there been any direct contact either from RDA -- I guess it would just be RDA, not PHA -- with any of the 51 residential property owners to discuss or to gauge their interest in relocation, staying or relocating within the community?
I would -- I would -- I would tell you -- I would advise you that a series of --
To my knowledge, there have been some contacts with property owners. We did not gauge their interest in having the Authority take their homes, if this was a good thing or bad thing. This was not a -- we didn't pose the question in terms of, "Do you want us to do this?" There was a series of meetings where the developer outlined their specific plans for clearance, new construction, rehabilitation, and elimination of these units before this matter was considered by the Planning Commission as well as 35 5/25/99 RULES - BILLS 990254 the Redevelopment Authority. The discussion that occurred, undertaken by the developer and the Housing Authority with some of the Redevelopment Authority staff was to discuss the plans for the development, and as part of those plans, the impact of the need to acquire these properties and, therefore, the resulting possible relocation of 51 families.
All right. But we don't have an idea as of those 51 families in this universe of potential relocatees who of those 51 are either adamantly totally opposed, somewhat interested or interested. I mean, in order to -- here's my issue. You have 270 properties. A bulk of the properties are either empty houses or vacant lots. I want to put them aside at this point because I don't know whether or not there's a lot of -- maybe perhaps there is some civil legal concerns relative to owners of the properties, the owners of the vacant lots and that's something I'm sure that either could be negotiated or litigated at some point in time. But of the 51 families, we -- could 36 5/25/99 RULES - BILLS 990254 that list be reduced by having conversation with them as to who is interested or not? Not to give them a sign-off or, you know, to -- do you understand what I'm asking?
I understand that. The plan, as proposed by the Housing Authority and the developers, calls for the clearance of all the properties on this list. The reason they propose that is, they believe, as does the Planning Commission, that the level of decay within the neighborhood, the lack of quality of public improvement, the narrowness of the streets, the desire to establish a new redevelopment plan that provides long-term viability for this substantial investment in the -- it is the position of those who have adopted this plan to date that the public may be best served by acquiring all of these properties rather than leaving two or three occupied properties.
That's not my question. My question is: of the 51 families, is it conceivable that a portion of them, albeit a small portion of them, may in fact be interested in either relocation or a new house? 37 5/25/99 RULES - BILLS 990254
Well, I guess my question is, how do we find that out?
From a -- the Authority does not begin to undertake specific family-by- family analysis until after an ordinance occurs.
Are there any other questions from members of the committee? Mr. Eisenstat, how much money has been appropriated for the acquisition of these properties?
I believe that the acquisition cost of this property -- these properties estimates, if you can give me just a moment to refer to my notes. . . hold on just one second. I wanted to give you the breakdown of the figures. The general cost of acquisition of these properties located on the east side of Broad Street approximates $4.9 million. I would describe to you that the acquisition value of 38 5/25/99 RULES - BILLS 990254 these properties are generalized. These are before formal independent appraisals are conducted. So with that caveat, the acquisition costs are approximately $1.6 million, and we've also budgeted approximately $1.7 million in relocation benefits.
I'm sorry. Would you mind repeating those figures? The general cost of acquisition is 4.9.
4.9 million. The estimated budget for acquiring the land -- the properties themselves is about $1.6 million. Costs for relocation approximate 1.7 million. Other costs go to the areas of appraisals, title fees, and estimated reserve for delay compensations and Board of U. awards.
Thank you. The Chair recognizes Councilman DiCicco.
Thank you, Madam Chair. And I'm just thinking about our conversation this morning. We talked about those situations where people would be relocated, and we 39 5/25/99 RULES - BILLS 990254 talked about the mechanics of that. And I believe you mentioned that when a person is going to be relocated, it will be a one-time move; we are not going to move people around like a checker board from one location to the next when the move takes place. Would you --
Our intention in all the relocations that we undertake is to attempt to relocate individuals on a one-time basis. There have been a few instances where actual individuals, for very particular reasons, have asked to move twice. They are really where it's been in the interest of the homeowner or the tenant. In this situation, I believe the layout of this development, as contemplated and proposed and to be implemented by the developer and the Housing Authority, should allow individuals who might choose to stay here the opportunity to have -- that we'll be able to do some phasing here so that priority can be given to local residents and 40 5/25/99 RULES - BILLS 990254 that they would only have to move once.
And I think, Madam Chair, we'll probably get into a little bit about the mechanics of that when the developer gets up to testify as to the phase of the project and how people who may have to be relocated will --
I don't think that a specific phasing plan is in place, but the nature of the -- the scope and the size of the project and that all of the units will not be rehabilitated at once should allow -- will allow all of that to occur.
Thank you, Madam President. Mr. Eisenstat, the issue of rehab versus clearance, does it become an economic issue? Are the conditions of the property itself whether it's worth rehab or whether it makes more economic sense to build new a home? How are those decisions made? 41 5/25/99 RULES - BILLS 990254
Well, I think that it is not an exact science. In some situations, the overall condition of the housing unit is such that it needs to be demolished, and that goes for all of the vacant -- the majority of the vacants. I don't know if there are any vacants that are actually worth rehabilitating. There are a few vacants that are worth rehabilitating here, and that could be a relocation resource in this development. In other situations, it is the professional -- it is the belief of those developing the plan, along with the Planning Commission and the Redevelopment Authority, that the existing street grids in the high-density narrow houses, short alleys for long-term viability of this overall development, where you have so few houses left on a block that in fact, while the individual structure may have economic vitality in its own condition, that from a long-term perspective -- not unlike what has occurred in Poplar or Cecil B. Moore and anticipated in Jefferson Square -- that ultimately, the desire -- it is believed that the 42 5/25/99 RULES - BILLS 990254 best overall long-term plan for that area is the reconfiguration of streets, public improvements, and the actual density and configuration of housing units.
So it's not just the condition of the property; there are other factors that are taken into account.
Thank you, Madam Chair. Mr. Eisenstat, if I am a homeowner in the designated area today, what are my options or what are the chances of me being able to relocate into one of the new homes that are being built? And what determines my ability to move into that?
I think I'd like to have some of that discussion with the developer as well. But following the activities that have occurred in other relocation -- in other developments within Philadelphia, as I said earlier, priority has to be given by law to 43 5/25/99 RULES - BILLS 990254 individuals who are being relocated, or the word is -- properties are being acquired. Therefore, those individuals will be given priority to be relocated into units that might be new reconstruction or rental. You may also find individuals who aren't currently homeowners who may opt to become renters, maybe due to change in life cycle status. They may be elderly now, you know, older. People may decide they want to sell a home, and that happens all the time, or they may wish to become renters. There's a series of rental developments that are occurring in the area beyond the Martin Luther King development that individuals may be interested in.
I just want to make a comment on that because it created a -- it did get a bit of a stir in the crowd. I mean, my own parents, for example, owned a home, which was a larger home, four bedrooms, and sold it, used the equity, and now rent, and are very happy renting. They don't have 44 5/25/99 RULES - BILLS 990254 the responsibility of paying real estate taxes, maintaining the property. They're not extremely old; they're in their middle sixties, but they're much happier renting with the equity they received from the home that they sold. So I don't think that that's an extraordinary situation, especially when you get up in age and your kids are gone and you're kind of empty nesters, that perhaps renting in an appropriate circumstance makes more sense for you than owning a home again but that's a --
Yeah. I know it stirred the crowd, but in my own personal experience, my parents are much happier renting than they were owning so. . .
And I'd just like to comment because I'm having similar conversations with people at another site, Jefferson Square. Just as an example, we can cite a lot of examples today. You may have an individual, a single person or an elderly couple who are living in a 45 5/25/99 RULES - BILLS 990254 three-story, five-bedroom house, and they really don't have a need for that. And that may be one of the houses that may be under consideration for taking. But within a block or two from where you're presently living, there may be a two-story house that will be rehabbed as part of the overall rehabilitation of that area, and that may be a much more attractive environment for those two folks to be into. They would still be a part of the community, live within a reasonable proximity of where they've been living for the last 30, 40, 50 years, but will have less expenses -- a smaller home, less maintenance, less heating bills. Overall, it may actually be a better situation than they're presently in. And I think that we get to that when we have those individual discussions with individual property owners based on what their needs are. And on the flip side -- and I said this out on Webster Street this morning, and I'm not trying to paint such a rosy picture here because there is an emotional issue that has to be developed -- is that the present market value of homes today is at a certain level. When the 46 5/25/99 RULES - BILLS 990254 rehabilitation of the Martin Luther King community occurs, property values will increase. So on the resale five, ten years up the road, if you decide to sell, you would get significantly more for your home than today. So there is some benefit possibly long-term for some people.
I would simply also add the converse, that the requirement of meeting the federal housing quality standards may actually require in some situations, a family living in a two-bedroom unit with possibly three children would by law have to be relocated to a unit of at least three bedrooms. So the process may work both ways.
Thank you. Are there any other questions from members of the committee? (No questions.)
All right, Mr. Eisenstat, you are going to stay with us until the conclusion of the hearing or have a representative here?
I believe that's the 47 5/25/99 RULES - BILLS 990254 case, Council President.
I think it would be appropriate at this time, Madam Chair, to have the developers come forward and the Housing Authority together.
The developers and the representatives from PHA should approach the witness table, please. Is someone here from the Housing Authority? (Developer and PHA representatives come forward.)
Good afternoon. My name is Anthony Brown. I'm the General Manager for the Philadelphia Housing Authority responsible for the Hope VI Program.
My name is Donna Saftollo (ph.). I'm the project director for the Martin Luther King Project for the Philadelphia Housing Authority. 48 5/25/99 RULES - BILLS 990254
I believe a question was asked earlier, how many people were living in Martin Luther King project, and how many are still there, how many have been relocated?
There was a total of 538 units, of which not all were occupied. But I can say to you that there are approximately 40 families remaining today. And the goal is to have the remaining families relocated by the end of the week.
Okay. The Martin Luther King development consists of total of 538 units. Although I can't say to you how many was there at the time we began the development, because not all were occupied, currently there are about 40 families remaining today, all of which we expect to have relocated by the end of the week.
By the end of 49 5/25/99 RULES - BILLS 990254 this week?
Can you tell us where they've been relocated to or where they will be relocated to?
The specifics of where they will be going, I'm unable to say. I just know that they've been relocated to other PHA properties throughout the city, Section 8 properties throughout City. Some have moved with family. But they're in various parts of the city, and arrangements have been made, assignments have been made with the families. Some are just waiting for units to be rehabbed now so that they can move into them.
And they have all received a Section 8 certificate?
Not all. Those that did not receive a public housing units, i.e., a scattered site or available public housing unit, yes, they've received the Section 8. Some were transferred in other PHA units throughout the city.
It could be Raymond Rosen, Richard Allen, scattered sites, many developments throughout the city. Any one of the PHA development throughout the city where we have vacancies and units are available, we've transferred.
All right thank you. Any other questions for PHA?
Okay. Thank you. Why don't you remain there just in the event that we have other questions. At this time, we would like to hear from the developers, please. Kindly identify yourself for the record.
Yes, good morning, Council. My name is Raheem Islam. I'm the Executive Director of Universal Community Homes. We are a copartner in the Uni-Penn development of this project.
My name is Robert Totarro (ph.), and I'm Vice President of Penrose Properties, a copartner with Universal Community Homes in this development.
All right. Mr. Totarro, or Raheem, would you please explain to us exactly what is being proposed with this development.
Yes, thank you, Madam Chair. We are proposing to revitalize the Martin Luther King Plaza Public Housing Project. And as Mr. Eisenstat noted earlier in his testimony, the revitalization is not just the redevelopment of a public housing site. Under the program through which the effort will be funded, the Hope VI Program, HUD, the administrator of the program, requires that the Housing Authority and its private-sector partners redevelop the neighborhood in which the property is located as swell as the site itself. So we are jointly proposing, in partnership with the Housing Authority, to 52 5/25/99 RULES - BILLS 990254 redevelopment the MLK Plaza site and the surrounding neighborhood with approximately 250 housing units. Those housing units will be developed both through new construction and through rehabilitation. Approximately one half the housing units will be rental housing units, and the other half, obviously, will be for-sale housing units. That's the overall plan for the revitalization of Martin Luther King Plaza, which obviously, of course, includes the demolition of the existing -- of the four existing high-rise towers. And after that, Madam President, that at the time the grant application was submitted to HUD for the Hope VI funding, there were 272 families living at MLK Plaza.
Now, let's get back to the 51 occupied properties. If they are property owners, would they be given first preference to the homes that are rehabbed, whether they be for sale or for rent?
This development is, in the end, a public housing revitalization effort. 53 5/25/99 RULES - BILLS 990254 It is being financed by public housing funding. And though it encourages the revitalization of the community, there are still federal statutory limits on those who can benefit from the investment of public housing monies. So for example, the rental units that will be developed will have a maximum income limit for eligibility for occupancy at 60 -- 6-0 -- percent of the median income for the area. The home ownership units will have an income limit of 100 percent of the median income for the area for eligibility. So anyone, whether a MLK Plaza resident, whether a resident of the Hawthorne community, or anyone else who is interested in purchasing or renting a redeveloped unit in this redevelopment effort, must comply -- must meet those income eligibility standards. That having been said, current or former residents of the MLK Plaza public housing property must be given first-priority access to the redeveloped units. They are, after all --
But I thought they were all relocated. 54 5/25/99 RULES - BILLS 990254
They are, but they have the right to return to the site if they choose to return and if they qualify to rent or to purchase one of the units redeveloped. The second priority -- Mr. Eisenstat is certainly correct in stating that the Relocation Act gives anyone affected by a public taking preference or priority access to housing developed with federal funds, and certainly these units we're proposing to develop are such. They too, then, would have priority -- a second priority over anyone else who might be interested in these units, provided of course that they qualify.
Just to elaborate on the question. The people who potentially will lose their home, the owners who live in the property now and own it off site, off the King site in the neighborhood, they get a second priority to the redeveloped house or to the new structure. You said that as long as they qualify -- do they still have to qualify under those income guidelines?
That is correct. Because the units are developed through financing provided 55 5/25/99 RULES - BILLS 990254 under programs that have income limitations.
It's the same priority as the public housing residents have. They don't have an absolute guaranteed right to return; they too must qualify.
It is more likely that the current and soon-to-be relocated public housing tenant would more likely qualify than not, and the home owner would be in a different situation potentially financially.
That's a judgment that I don't think we can make today. I mean, there are going to be minimum standards for admission to these units that may be a lot easier for non-public housing residents to meet than for --
What's the standards? I think we have to understand what the standards are because I'm not very clear on what the standards are, as you're explaining them.
No. Can you 56 5/25/99 RULES - BILLS 990254 explain them again, because that percentage issue -- I mean we like to really talk in real numbers.
I mean, if you want to give us an idea in general terms -- (Applause.)
I just want to get an idea in general terms of how much you have to make a year in order to qualify in this particular neighborhood.
I believe that the current median income for the Philadelphia metropolitan statistical area for a family --
No, that's not the area. Isn't this the Hawthorne area or SMSA?
Sir, we're taking about a federal program that has income limits that are mandated to use the census data.
And the current median income for the MSA for a family of 4 is approximately $48,000.
So that -- so that if a 57 5/25/99 RULES - BILLS 990254 family has income not greater than $48,000 and is interested in purchasing one of these homes, they can obtain the financing to do so -- and has been adversely impacted by this taking, then they certainly have the opportunity to purchase one of those homes.
Then that was the answer to the question. I don't know why we had to go around the route we went in order to find out that it was $48,000, sir. I mean, you know, there's an attitude. I asked you a question and it's a very simple question, what is the amount of money per year? And the attitude from the answer is not something that's conducive to moving forward in --
My name is Jim, Mr. Kenney, Councilman, I don't care what you call me. But when I ask a question, I just expect an answer. And because of the way in which you presented the first answer, it was very difficult for any of us to understand just how much money a year you would be able to make in order to qualify 58 5/25/99 RULES - BILLS 990254 for this program, that's all. It wasn't that complicated a question. Thank you for the answer.
There were two qualifications income qualifications that Bob mentioned. The first income qualification was for home ownership, and he mentioned 100 percent of median income. That basically represents -- he said 48,000; I believe it's 48,000 and 52,000 for a family -- AUDIENCE MEMBERS: We can't hear you.
Excuse me one minute. We're still having trouble with the microphone.
I will try to speak up. Can you hear me now? There were two income qualifications. The point that's being made here is, based on the qualifications of returning to those either for-sale units or rental units. For the for-sale units, there's one income qualification. That income qualification is 100 percent of the median income, which is roughly about 48,000 to 52,000 for a family of 4. So anybody who had that type of income would have qualified for the income -- 59 5/25/99 RULES - BILLS 990254