COUNCIL OF THE CITY OF PHILADELPHIA PUBLIC HEARING COMMITTEE ON RULES - - - Room 401, City Hall Philadelphia, Pennsylvania Tuesday, June 15, 1998 10:00 a.m. - - - BILLS 960696, 980048, 980846, 990311, 990327, 990328, 990329 990331, and 990358 - - - PRESENT: COUNCIL PRESIDENT ANNA VERNA COUNCILMAN FRANK DI CICCO COUNCILMAN MICHAEL A. NUTTER COUNCILMAN DAVID COHEN - - - VINCENT VARALLO ASSOCIATES, INC. Registered Professional Reporters Eleven Penn Center 1835 Market Street, Suite 600 Philadelphia, Pennsylvania 19103 (215) 561-2220 2 I N D E X BILL 980846 (No witness) ................................ 16 BILL 990048 MARK BENCIVENGO, Dept. of Health ............. MICHAEL NORDONE, Deputy Managing Director ..... 18 5 BILL 990327 NOEL EISENSTAT, Redevelopment Authority ...... 20 GLORIA GUARD, People's Emergency Center ...... 23 BILL 990328 NOEL EISENSTAT, Redevelopment Authority ...... 27 LINDA SINGLETON, McCleary Project Home ....... 34 JOHN MORLEY, JR. ............................. 35 BILL 990331 JEREMY NEWBERG ............................... 60 MARY BLACK ................................... 92 GINA CARUSO .................................. 93 JOE ROSS ..................................... 98 KATHY FURBER ................................ 100 DOROTHY KING ................................ 102 JEANINE VOLLBRECHT .......................... 107 EDWARD VOLLBRECHT ........................... 111 KARL FRITCHETTE ............................. 113 SUZANNE HANEY ............................... 115 KIRK BROWN .................................. 119 JOE ROSS .................................... 123 JOHN JOHNSON ................................ 125 JOHN MORLEY, JR. ............................ 131 FRED DRUDING ................................ 134 3
Good morning everyone. This is a public hearing of the Rules Committee. I would ask the clerk to please read the title of number 990358.
An ordinance to amend the Philadelphia Zoning Maps, by changing the zoning designations of certain areas of land located within an area bounded by Hartranft Street, Broad Street, Pattison Avenue, and 20th Street.
This bill is being recessed until tomorrow, July 16, 1999 at 1:00 p.m.
An Ordinance to amend the Philadelphia Zoning Maps, by changing the designation of the following area of the City from Class C-5 Commercial to Class C-4 Commercial: Area bounded by Arch Street, 22nd Street, Cuthbert Street, and 23rd Street.
This bill is being continued until the call of the Chair. Will the Clerk please read the title of Bill No. 990311. 4 BILL NO. 990048
An ordinance to amend the Philadelphia Zoning Maps, by changing the zoning designations of certain areas of land located within an area bounded by 52nd Street, Paxton Street, Leidy Avenue, Parkside Avenue, Belmont Avenue, Girard Avenue and Merion Avenue.
This bill 9 being recessed until tomorrow June 16, 1999 at 1:00 p.m. The Clerk will please read the title of Bill No. 980048.
An Ordinance amending Chapter 9-1600 of the Philadelphia Code relating to the prohibition against unlawful eviction practices by excepting from the definition of "landlord" a non-profit landlord operating a boarding house or lodging house.
Do we have someone here from the Administration who is going to be testifying on this bill? Please approach the table. Good morning. Please identify yourself for the record and proceed with your testimony.
My a name is Mark R. 5 BILL NO. 990048 Bencivengo, Assistant Health Commissioner, Philadelphia Department of Public Health. Good morning, Members of City Council. I'm here this morning representing Health Commissioner Estelle B. Richman. The focus of my testimony is on providing information about the non-profit organizations with which the Health Department contracts for residential services, the individuals who typically live in these residences and the services which are provided under contract to the Health Department. The Health Department contracts with a wide variety of non-profit organizations that provide housing and our residential services. These organizations range from relatively large corporations with multi-million dollars annual operating budgets to small community-based grass roots organizations that may operation one house with only a few residents. What all of these organizations have in common is that as a result of the contractual obligation that they have with the Health Department, they are held to a set of standards with which they must comply in order to continue operating with departmental funding. These 6 BILL NO. 990048 standards vary depending upon the component of the Health Department, which is the purchaser of the services. But there are general areas that covered in all of these arrangements. These standards include items such as staffing coverage, guidelines for resident behavior and life safety issues related to the physical facility. All facilities must be in compliance with licensing requirements of the Department of Licences and Inspection. The Health Department component that is the purchaser of services takes responsibility for maintaining oversight of the residential program and monitors the program on an ongoing basis. Individuals living in facilities under contract to the Health Department may fall into one or more of several groups. Significant numbers of individuals in residential programs include persons with mental illness, persons with mental retardation. Persons in recovery from substance abuse and persons with AIDS. Within these groups are subsets of people with additional concerns, such as pregnant women, women with children, and individuals who are homeless. What most of these people share is a extreme degree of vulnerability at 7 BILL NO. 990048 this point in their lives and the need for a supportive environment. Some may be stabilized and living in a long-term arrangement that will not change for years. Many others require treatment services that must be provided intensively for weeks or months at a time. With the different needs of these individuals comes a broad array of services. In some instances, people live in the facility full time in which they receive their treatment. In other types of arrangements, individuals live in a residential facility while receiving treatment services at a different location. Residential staffing can vary from periodic checking in for people who are able for the most part live independently to 24-hour, 7-day-a-week coverage for the most vulnerable individuals. In addition, a substantial number of individuals work with case managers who may help them negotiate the more difficult aspects of their daily lives and support them as they seek the array of services they require. My intent this morning, as you contemplate the bill before you, has been to give 8 BILL NO. 990048 you a quick picture of the non-profit landlords with which the Health Department contracts, along with the people served and the range of services provided. There is a certain balance that is required since in many cases these are unique arrangements. The vulnerability of the individuals residing in these facilities suggest that special rules should be in place to protect them.
On the other hand, in circumstances where residents act abusively or beyond the rules of the operating structure of a resident, the non-profit landlord should not be put a position of having to jeopardize the well-being of the rest of the residents by being forced to retain a non-compliant resident. In circumstances such as this last example, it is often the case that the Health Department intercedes to attempt to resolve a conflict. How your ordinance 19 may be structured to address situations such as these is the real challenge. I'd be pleased to answer any questions that you have. Thank you for the opportunity to present this testimony.
Thank you. Can you tell us, if you know, how many individuals 9 BILL NO. 990048 or entities that are currently considered landlords that would be affected by this bill?
Within the Coordinating Office for Drug and Alcohol Abuse Programs, we have roughly have roughly 42 providers that may be affected by this bill. As I said, providers ranging from multi-million dollar corporations -- I can give you an example like the Cadensia (ph) Corporation which runs therapeutic communities for us down to smaller grass roots organizations that run recovery houses under contract to the Department. I would also say that the Health Department, although other components of the Health Department also have facilities like this under contract, for example, the Office of Mental Health and Mental Retardation and the AIDS Activities Coordinating Office, and also other departments such as the Department of Human Services would have facilities like these under contract.
How about boarding homes, would they fall under this?
Well, some of them have boarding home licenses, and I presume those with boarding home licenses would fall under this. We 10 BILL NO. 990048 would be concerned within the Department that virtually all of the residential facilities that we contract with are non-profit and we would be concerned about setting up a separate class of these non-profit-run agencies under an ordinance like this especially as it pertains to the protection of the populations that we have receiving services.
For the record, can you tell us why we need this bill?
Well, what I'm suggesting is that we should be cautious about enacting a bill such as this because of the possibility that it does set up a separate class of people who reside in non-profit-run boarding homes. So that how this is defined for the purposes of this bill, I think, needs to be looked at very, very carefully. So I'm not suggesting that we need this bill, I'm suggesting that we further define and perhaps further look at and consider the implications across the various operating departments that utilize these services.
I'm wondering how will a non-profit status be certified to ensure that only those landlords who meet these criteria 11 BILL NO. 990048 are exempted and that others don't try to ride the gravy train?
I think that the input of the Law Department around how these kinds of facilities are defined is critical, and perhaps a work group could be convened that would look at these facilities and the broad array of facilities that are under contract to the City to offer these kinds of services. I mean, within the Coordinating Office for Drug and Alcohol Abuse Programs there are probably upwards of 800 individuals that live in non-profit residential-type facilities. They may not all be classified as boarding homes, but I'd be concerned about definitions changes in order to accommodate perhaps a desire to remove certain persons.
Thank you, Madam Chair. How would, in your opinion, the operation of a residential drug treatment facility encompassing perhaps five or six individuals in a residential row house come under this -- be affected by this bill if in fact the organization that's running it is set up 12 BILL NO. 990048 as a non-profit?
If it has a boarding home license, I imagine it would come under this bill, but I'm not clear --
I believe so, but I'm not totally clear on that, and that's why I'm here this morning because of the possibility that there be kind of a broad brush definition of facilities that might be included in this.
When we had a very extensive discussion a couple years about the licensing of residential drug treatment facilities and we came up with a bill at that time which we thought was acceptable and workable but apparently was not, there seems to still be this limbo non-designated status of these properties. What you're saying in your testimony now and my question is, this would only effect licensed boarding homes?
As I understand it, 13 BILL NO. 990048 this would effect licensed boarding homes.
So those residential facilities is still in this kind of --
The Health Department, as I remember the bill, the issue came up around a number of recovery houses that are operating within Philadelphia. And since that time and maybe just prior to the time that that bill was discussed, the Health Department began an initiative to what we call the CODAP housing initiative where CODAP working with recovery house operators developed a set of standards that recovery house operators seeking to contract with the Department would have to sign off on, and they were quite strict. The Health Department, per se, doesn't license these kinds of programs. But if he we contract with these programs, and currently we have contracts with 15 of them, they must abide by our regulations and the Coordinating Offices has people in these programs quite frequently.
But if an individual runs a not-for-profit residential recovery house with five or six individuals not related living in one property, sharing rooms, sharing a kitchen, what 14 BILL NO. 990048 is the difference between that and a boarding house.
I think there may not be, but I'm not clear on that. That's my point. For anyone that's under contract with the Department, we want to be able to maintain the oversight. And, in fact, what the Department does is we gate-keep entry into those programs. And by the regulations that we have and the rules that we have within the Department, providers cannot ask someone to leave without contacting the component of the Health Department which contracts with them so we can make arrangements for that person's removal to some other type of facility. In other words, we don't want anybody streeted.
Madam Chair, could we have some history as to why this bill is before us? I mean, is a problem that the bill -- I kind of think the first testimony ought to be what is the problem that we're dealing with. I was trying to figure this out because we were treating the witness as if it were their bill, and I couldn't understand why he was so defensive about it and unsure of what the bill meant.
Councilman DiCicco, would you like to address this?
Thank you, Madam President. This bill was brought to my attention -- this issue was brought to my attention about 2 years ago by a young lady who is the manager of a boarding house in my district. She was from time to time having difficulty in removing people from her facility and there seemed to be some sort of glitch in the law that we thought we were able to address by way of this legislation. I can do one of two things. My chief of staff, Robin Schatz, spoke with Mark earlier. We can hold this bill for further discussion over the summer months. I had asked if 16 BILL NO. 990048 Ms. Lewis would be willing to testify, but she has a concern she may say something that may prejudice her position at the facility. And in the absence of her attorney representing her today, I think she would choose not to speak, and I can understand that. So I would be willing to make a motion we hold this bill until sometime when we come back after summer recess and over the summer months work with the Health Department and the agency that brought this to my attention to see if we can find some resolution to this situation.
Councilman, I know that will several years ago I had in my district a boarding home and there was a dreadful, dreadful experience that we witnessed. I would like to discuss that with you so that -- I think the state laws that exist are absolutely atrocious regarding boarding homes, and I'd like to discuss that with you so it can be an all-inclusive type of bill. Are there any other questions on this matter? Does anybody else want to testify on this bill?
My name is Mike Nardone, 17 BILL NO. 980846 Deputy Managing Director for Special Needs Housing, and I share many of the concerns that Mr. Bencivengo mentioned and would support the notion of holding the bill and meeting over the summer to try to resolve some of these issues.
Thank you very much. The Clerk will please read the title of Bill NO. 980846.
An Ordinance amending section 9-623 of the Philadelphia Code, entitled "Adult Bookstores," by specifying that the operating hours of adult bookstores shall be restricted in certain areas, all under certain terms and conditions.
At this time I'd like to offer an amendment to this bill. And the amendment will be in Section 1 under definitions (2)(3) adult bookstores located in the following areas shall not be open between the hours of 3 a.m. 18 BILL NO. 980846 and 8 a.m. 12 midnight will be changed to a.m. 3
Is there any first amendment concerns that we need to consider before we pass the bill?
No. To the best of my knowledge, no. And there have been considerable discussions I've had over the last six or seven months both with the Police Department, with the Department of L and I, and the owner/operators of the adult bookstores. Primarily what this bill was intended to do was to address some of the problems with 24-hour type of businesses in the Center City area. I believe, if you read into the bill further, you will see that in other sections of the City it may not apply. It really applies to those stores which are a thousand feet of a residential community, historical parks, hotels, convention centers, et cetera.
Thank you. Are there any questions from Members of the Committee? 19 BILL NO. 990327
Are there any witnesses to testify on this bill? Are there any questions? Seeing none, I would ask the Clerk to please read the title of Bill No. 990327.
An Ordinance amending an ordinance approved December 15, 1969, 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 Mantua Urban Renewal Area, by approving the 9th amendment of the redevelopment proposal and the 6th amendment of the urban renewal plan by providing, inter alia, for certain additional land acquisition of five properties.
I thought I saw Mr. Noel Eisenstat in the audience. Will he please take the witness table? Good morning. Please identify yourself for the record and proceed with your testimony.
Good morning. My name is Noel Eisenstat. I'm the Executive Director of 20 BILL NO. 990327 the City's Redevelopment Authority. I'm here to provide testimony before the Rules Committee on Bill 4 990327. With me today I have representatives of People's Emergency Shelter, Gloria Guard, their executive director, as well as Melissa Long, the project manager for West Philadelphia. The purpose of this bill is to acquire one commercial property for rehabilitation and into offices and four vacant lots for a new construction of a job and training and day care center. There is a land use map before you and these activities are being undertaken after previous attempts were directed by PEC to negotiate the acquisition of these properties, and there was also a previous attempt to acquire these properties through spot condemnation. The nature of these properties made that difficult. In particular, one property had previously been in the ownership of the City and was conveyed by bid and there were no reverters to the ownership, although no rehabilitation or improvement of that property ever occurred. That's a generalized discussion of the history that precedes this bill that's before you.
Mr. Eisenstat, 21 BILL NO. 990327 are there sufficient funds in place to fund this proposal?
Yes. These funds are actually coming from People's Emergency Center. This is not a direct project funded by the Office of Housing and Community Development. This is what we would we otherwise refer to as an assisted condemnation.
Thank you. Just for the record, Mr. Eisenstat, the title of the bill 17 reads that you are essentially acquiring five properties and you've testified about that. Can you tell us what the addresses are of those properties? It doesn't seem to be listed in the bill.
Sure. I would be happy to provide you those addresses. They are 3939 Warren Street, it continues 3941, 3943 3945 Warren street, as well as a two address property known as 3942-44 Lancaster Avenue. 22 BILL NO. 990327
Mr. Eisenstat, the end of your first paragraph says, "The acquisition of 3939 through 3943 Warren Street and 3942-44 Lancaster Avenue," and I assume they are all of the properties involved, "will not require any relocation." Now, it seems strange to have it worded that way. Are the buildings occupied or not occupied?
The Warren Street properties are all vacant lots. The Lancaster Avenue address is a vacate structure.
I think displacement creates an entirely different problem. Reminds us 23 BILL NO. 990327 of Leithgow, Hegerman Street, all of those things if there's displacements. But there's no displacement here; is that right?
All properties here are vacant. They've been vacant for a long time. Only one property has a structure. That structure has been vacant for a considerable amount of time. Everything else is a vacate lot.
Thank you. Our next witness is Gloria Guard, president of the People's Emergency Center.
Thank you, Madam Chairman. I'm Gloria Guard from People's Emergency center. Rebecca Badigon from our CDC will be bringing you my testimony as well as some charts and graphs. I think that many of you already familiar with our work. We're the oldest shelter for homeless families in the State of Pennsylvania. These properties that will be able to be turned over through urban renewal are immediately next to properties we already own. There is a huge 14,000 square foot playground that we developed about eight 24 BILL NO. 990327 years ago and we'll be placing a child care center for over a hundred children right on that playground. Upstairs will be a job training center for over 200 women each year, all of whom are homeless and all of whom are facing welfare cut-off. This is our response to Welfare Reform, and as Mr. Eisenstat said, this is the only way that we can get these properties which are really perfectly situated for our needs. What you have in front of you not only is my testimony, but also we have some pictures of the lots as they now exist. They're all abandoned. They're trash strewn, they're filled with abandoned vehicles. There's no question that renewing this area will be a huge boom to the Lancaster Avenue corridor. In addition, you also have letters of support from virtually every organization in West Philadelphia as well as a petition signed by over 125 individuals in and around the neighborhood. We have the full support of Councilwoman Blackwell. And I believe that we've done our due diligence in talking to the neighbors over a year and a half about this project, and they're all anxious for it 25 BILL NO. 990328 and 990329 to get off the ground.
Thank you. I know that Councilwoman Blackwell said she wanted to be here, but an emergency came up. She told me that she fully supports this bill. Are there any questions from members of the Committee? Is there anyone else to testify on this bill? Thank you all very much.
Would ask the Clerk to please read the title of Bill No. 990328.
An Ordinance amending ordinance approved December 15, 1969, 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 the Model Cities Urban Renewal Area, by approving the 24th amendment of the redevelopment proposal, the 16th amendment to the urban renewal plan and the 15th amendment to the relocation plan which provide, inter alia, for additional land acquisitions of approximately 57 BILL NO. 990328 and 990329 properties and provision of certain relocation services, as required by law.
Good morning. My name is Noel Eisenstat. I'm the Execute Director of the City's Redevelop Authority. I am here today with members of my staff and others to discuss Bill No. 9 990328, and later 329, I believe.
They were introduced in succession. And as I will explain, the first bill 14 328 --
Mr. Eisenstat, if you're going to be testifying on Bill 990329, I think we ought to read that into the record.
I'm suggesting you read that later. I'm just explaining that whatever you wish to do, I'm just explaining this bill.
If they're companion bills then they should be read. Will the Clerk please read the title of bill No. 990329.
Bill No. 990329, an 27 BILL NO. 990328 and 990329 Ordinance amending an ordinance approved December 22, 1987 which approved the redevelopment proposal and the urban renewal plan of the Redevelopment Authority of the City of Philadelphia for the redevelopment of the Cecil B. Moore Avenue Urban Renewal Area, by approving the 6th amendment of the redevelopment proposal and the 6th amendment to the urban renewal plan, which provide, inter alia, for the additional land acquisition of approximately four properties.
The first bill before you, 990328, acquires approximately 57 properties in three different projects. They include 40 properties for the Cecil B. Moore ownership zone. This is 40 properties in the area of 14, 15, 16, and 1700 block of North Bouvier Street in the areas generally bounded by 19th and 20th Streets. These properties will be assembled with the existing 218 parcels whose acquisition was previously authorized by Council. The second element of this bill is the acquisition of 16 properties for the Welsh School parking lot. The Welsh School parking lot is an arrangement reached with the Empowerment Zone as a 28 BILL NO. 990328 and 990329 funding source to provide additional parking to take -- is there a problem?
The Welsh School parking lot is a program that provides additional parking for teachers in the school of the Welsh School adjacent to the Empowerment Zone ball fields.
Previously, City Council 13 approved what was known as the ball field project, 14 one of the first the Empowerment Zone projects, and 15 in doing so, certain streets were closed and there 16 were certain negotiations at that time and then followed on that there was a request of the School District to replace the loss of the parking for the ball fields. The School District has come back as part of that and has requested additional vacant parcels, all vacant, to be acquired close to the school for additional parking for the Welsh School. In an addition as part of this bill, there is one property to be acquired for Project Home in the Project Home area located 1816 North 29 BILL NO. 990328 and 990329 23rd Street. Those are the elements of the first bill before you. The reason why the bills are companion is simply the next bill overlaps as part of the Cecil B. Moore Home Ownership Zone an additional three properties. What we have is the intersection of two urban renewal areas, the original Model Cities area in late 1980s was then redefined and separated into the Cecil B. Moore Urban Renewal Area. That's the cause for the companion bill in which then that there are to projects that are happening, as I said, three additional parcels for the Home Ownership Zone project and an additional one properties to be acquired on the 1600 block of North 16th Street for the Beach Interplex Organization for a day care center.
Thank you. Mr. Eisenstat, do you have letters of support from the community organizations in these area supporting these acquisitions?
Yes. In various different forms we have support. The Cecil B. Moore Home Ownership activity is being under taken by a local development corporation entity set up by 30 BILL NO. 990328 and 990329 PHDC. And that group that is not, I don't believe, here today. And this is actually a request of the developer. We're carrying out the acquisition on behalf of this local development corporation. The Welsh School activity is being undertaken on behalf of the School District, however, there was extensive community dialog surrounding the Community Trust Board in the neighborhood before these acquisitions occurred.
On the School District acquisition of the properties, there are no 13 relocations in that parcel?
That is correct. Concerning the properties with Beach, Beach is a not-for-profit entity located on Cecil B. Moore Avenue and we're again acquiring this on their behalf and I believe that itself is evident of support. And the Project Home property is in an area that Project Home has adopted as, I believe, part of the Philadelphia plan and has extensive out reach in that area.
What is the budget for this condemnation package?
We separate each 31 BILL NO. 990328 and 990329 condemnation package separately. So if you give me a moment, I have to aggregate them out.
Just a moment. Concerning the school, you've asked me about the estimated budgets. These are estimates. With those estimates I would caveat that independent outside third-party appraisals will still have to inspect properties, but for the purpose of budgetary purposes we've estimated that the acquisition of the lots for Welsh School are budgeted about $40,000. 14 The property concerning Project Home is estimated 15 about $5,000. The property concerning Beach is at 16 about $6,000. And the acquisitions of various properties on Cecil B. Moore are in the $300,000.
How many parking spaces are we making available to the school?
Thank you. Are there any questions from Members of the Committee? 32 BILL NO. 990328 and 990329 The Chair recognizes Councilman Nutter.
Thank you, Madam Chair. Mr. Eisenstat, just so I understand, in Bill 990328, the total of 57 properties that are proposed to be acquired, do I understand from your earlier comments that within this bill there are actually three different projects going on, one involves 40 properties, one involves properties 11 and one involves one property; is that my 12 understanding? 13
And in Bill 990329 15 there are two projects going, one involving one 16 property and one involving one property.
Thank you. And all these projects are separate and apart from each other but the area happens to be within either these model cities and/or Cecil B. Moore urban renewal areas. And so if you have different things going on but they're in the same area, you put them in the same bill but they are separate stand-alone projects? 33 BILL NO. 990328 and 990329
Are there any other questions from Members of the Committee? Do we have anyone else to testify on the two bills? Please approach the witness table. MS. SINGLETON-McCLEARY: Good morning Councilmembers. My name Linda Singleton McCleary. I'm the Housing Development associate with Project Home. Project Home is actively home ownership development in the lower North Philadelphia area of the Philadelphia plan. The areas are bounded by Susquehanna Avenue on the north, Cecil B. Moore to 23rd Street to Ridge Avenue on the south, and 22nd street on the east and 29the street on the west. We have completed five units with HRP funds through the Redevelopment Authority since our participation in the Philadelphia plan. We currently have under construction eight units with Year 22 funds. And this unit that we're requesting today will be one of three units that we have in our application to the Redevelopment Authority for funds. We also have funds through the Sisters of 34 BILL NO. 990328 and 990329 Mercy to bridge any financing required for our construction projects. Our homeownership units are offered to first-time home buyers who are low and moderate income buyers. Project Home is also a certified 08CD housing counseling agency with one counselor on staff. And we currently have 8 qualified buyers for these units currently under 9 construction. Each of these units in our 10 application for HRP funds were completely occupied, 11 each of the blocks that they're located on. 12 We are very appreciative in you hearing 13 us today. Thank you.
Thank you very much. Do we have any other witnesses on these two about bills? Good morning. Please identify yourself for the record.
My name John H. Morley, Jr., M-o-r-l-e-y. I heard earlier testimony regarding Empowerment Zone funds. And during the spring there was some news reports of, in my opinion, improper use of Empowerment Funds. Council was to hold public hearings, and those public 35 BILL NO. 990328 and 990329 hearings were canceled. I ask as a citizen of Philly that the Council delay any decision on that until you hold the public hearing on Empowerment Zone funding.
I didn't hear Empowerment Zone being mentioned today. Did anybody else?
Who testified to that? Mr. Noel Eisenstat, did you testify to a Empowerment Zone? Maybe I just didn't understand your testimony. Mr. Morley, what bill are you refer to?
I'd be happy to provide some clarification, Council President. Again, my name is Noel Eisenstat. Only by the way of background did I explain that the acquisition of 16 parcels that are occurring on behalf of the School District are being funded by the Office of Housing and Community Development. And to explain that transaction, what I provided was the background that one of the first activities directed by the American Street Empowerment Zone was the creation of a ball 36 BILL NO. 990331 field that was fast tracked. As a result of that creation of that ball field, the School District lost a substantial amount of its property, including some parcels that were used for parking and other security around the school. This project has no Empowerment zone money. It is not approved by the Empowerment Zone Community Trust Board or by the offices in City government that administer the Empowerment Zone funds. This project is fully being funded by the Office of Housing and being administered by the Redevelopment Authority to assist the School District.
Thank you. Mr. Morley, does that respond to your concerns?
Is there anyone else to testify on Bill Nos. 990328 or 990329? Seeing none, I would ask the Clerk to please read the title of Bill No. 990331.
An Ordinance approving the redevelopment proposal of the Redevelopment Authority of the City Of Philadelphia for the 37 BILL NO. 990331 redevelopment of a portion of the Jefferson Square Redevelopment Area, Jefferson Square Urban Renewal Area being the area generally bounded by Washington Avenue on the north, South Fourth Street on the east, Dickinson Street on the south and South Sixth Street on the west; approving the urban renewal plan and determining that such plan and redevelopment proposal conform to the general locality plan and make adequate provisions for individuals, business concerns and families who are displaced; determining the necessity for changes in and for zoning, streets, alleys, public ways, street patterns location and relocation of public utilities; determining that the urban renewal plan and redevelopment proposal prohibit discrimination because of race, color, creed, sex, sexual orientation, national origin, ancestry or handicap; declaring that condemnation is not imminent with respect to the Project, except as otherwise expressly provided for in the proposal; and declaring the redevelopment undertakings in the Project to be an important part of the City's program to remove and prevent the spread of urban blight. 38 BILL NO. 990331
Thank you, Madam President. Today, we will hear a lot of testimony from a number of people who live and are concerned with the area that was just described in the bill 8 known as the Jefferson Square Revitalization Area. And I'd like to take some time, and I will try to be as brief as possible, however, that may be difficult because this has been a project that I have been involved in since the spring of 1996. In the fall and spring of 1995 when I was campaigning for the office of City Council in the 1st District and I was asked by a number of community groups what my position maybe on certain issues, one of the things I spoke to was my concern for blighted areas in the 1st Councilmanic District that was primarily on the fringe of or within stable communities, communities that had been maintained, homes that have been occupied by families for three, four generations. And I think all of us know and can point to a number of neighborhoods throughout the City where pockets of blight have been causing the more stable communities to begin to experience 39 BILL NO. 990331 blight similar to the much more blighted areas around them. What my concern was, that something needed to be done before this blight would continue any further. During the first few months in office, I discussed my plan and my vision with a number of people, both in and out of government. During that period of time, I came to know a gentleman by the name of Jeremy Newberg who is here this morning and will testify sometime during these proceedings, and he asked me a few things about why I decided to run for City Council, what was I planning to do. And one of the issues I talked about was neighborhood revitalization. And through those conversations, I came to understand that Mr. Newberg had been involved in a number of neighborhood revitalization efforts throughout the City and maybe throughout the country. I believe he had did something similar to what I was proposing to do in the Jefferson Square area in California. And it basically was an informal conversation that we had and expressing a plan and a vision and a dream I had for my community. It evolved to the point where in June of 40 BILL NO. 990331 1996, after receiving some state funding from Senator Fumo, we had hired an architect to design for us a conceptual plan of what we would hope that the Jefferson Square community would look like and become some day. We convened a meeting in the Mt. Sinai Hospital conference room facility at Fifth and Reed. About 50 or 70 area residents attended. We flyered that community with about 800 flyers. Mr. Newberg and a few other people personally went door to door and left a flyer in each and every mail slot in the area described in the bill to inform people that a meeting was going to be taking place about a plan and a vision for that community, for their community. At the time, there was a lot of apprehension, and I understood the apprehension because prior to my getting elected to Council, with all due respect to some of my predecessors, many of them had a plan that never came to fruition for one reason or another. But I was determined that I would do something to correct the problems in that community. And I was determined, and I'm sure there's some people that would disagree with this 41 BILL NO. 990331 statement I'm about to make, that I would include the community in that process. That was the reason for the first meeting in June of 1996, was to alert people in the community that from time to time they may see folks walking through their neighborhood with a clipboard and paper and pencil in hand taking down notes, taking photographs of their properties or their neighbors' properties. And I wanted them to understand why that was being done. And I also wanted them to understand that no decision would be made without their input.
We may not agree in the end and we still may not agree at the end of today and we may not agree at the end of this year on how this process will continue and how we move forward, but they were always going to be part of the process. And anyone who has known me before I got elected to Council and during the time I've been in Council know that anytime there's an issue of major concern, there is development similar to the entertainment on Delaware Avenue, I've always taken the position and insisted that the community be part of that process, and I've been successful to date in making certain that the community was part of that process. 42 BILL NO. 990331 As a result of that first meeting -- by the way. I was also a board member of the Mt. Sinai Graduate Health Services which were running Mt. Sinai Hospital at that time and I expressed to them my desire to do some rehabilitation of that community. They welcomed that idea, and in the process, they had agreed to donate about 60 parcels of land that the Graduate Health Services had been accumulating for a number of years in anticipation of hospital growth, which by the way, led to a lot of the deterioration in that community. Much of the deterioration, the majority of the deterioration was not caused by the residents in the Jefferson Square community; it was the result of the hospital, Graduate Health Services land banking, holding onto properties, not maintaining them and basically letting them deteriorate and ultimately having to be demolished. I was not the Council Person at that time. I was only a resident who lived about six blocks away, which is where I still live, at 11th and Federal. After the agreements were made with the Graduate Health Services to donate the properties to a CDC that we had created known as the Jefferson 43 BILL NO. 990331 Square Community Development Corporation, as many of us know, Mt. Sinai went out of business and was acquired by Allegheny Health Services. Discussion began with Allegheny Health Services to describe what the plan and vision was for the Jefferson Square community and how we believe the hospital facility would fit into that plan. Allegheny Health Services was very cooperative. They agreed to the agreements that we had made with Graduate Health services and agreed to be a partner with us to donate the land to the Jefferson Square CDC and to work in corporation with us. As we all know, subsequently, Allegheny Health Services went out of business; they went bankrupt. The building that make up the Mt. Sinai facility, which are about three buildings that make up the campus, are now sitting vacant. Over 400 jobs were lost. Most of those jobs were held by people from that community. This changed the dynamics of what we were proposing to do in terms of home rehabilitation. We now had to two battles to fight: One was the rehabilitation of homes, the removal of blight, and the other one was to find a tenant or tenants that would occupy the Mt. Sinai 44 BILL NO. 990331 facility because we believed then and we still believe that no one will buy a new home across from a vacant hospital building that occupies almost one square city block. It just is not attractive. It's not an attractive to make an investment in. During the course of the last two years, I have been negotiating with a number of people who have expressed interest in the hospital facilities. We were successful with the help of the Redevelopment Authority and the Administration in having the one of the buildings which we refer to as the north building, and that's the building southeast corner of Fifth and Reed, one of the three buildings that make up the hospital facility. We were successful in getting a tenant who will rehab that building starting this summer and create 37 units for senior citizens. We still have two other buildings to find a tenant for. By the way, when we made the agreement with the owner, the new owners of the North Tower Building, community participation was there.
I am on the board that will oversee and screen future tenants to that building with the hope that those folks that may have to be relocated as a result of 45 BILL NO. 990331 the new housing development would get first preference, those seniors would get first preference if they choose to relocate into the housing facility within a block or two from where they are presently living. We made certain of that. That was part of an agreement before I gave my stamp of approval for that building to be sold. In the course of the last year, year and a half, a group known as New Tower Investments or New Tower Associates purchased the other two remaining buildings of the Mt. Sinai facility. They have been negotiating with, and I have been a party to the negotiations, with a company known as Kessler Rehabilitation Services. Kessler Rehabilitation performs the same kind of work that Magee and the Moss Rehabilitation Center does. Kessler is a North Jersey company that is looking to move into the Philadelphia area. When they first went to look at the Mt. Sinai facility, they went back to the owners of the building and said that they didn't think -- they were interesting in the building but they were not particularly excited about the community that surrounded the hospital facility. They needed additional parking in addition to the parking that 46 BILL NO. 990331 is already on site -- and I'll describe that in a few minutes -- and they were also concerned about the blight and deterioration and the vacant lots and the other poor conditions of that community. Through negotiations with Kessler, we found that they have a need of approximately 200 parking spaces, if not more. That will require a significant number of single family residential properties to be acquired in order that we could facilitate the needs of Kessler. It is not a done deal. It was very close to being a done deal about six weeks ago, but for a number of reasons, one of which is Kessler's concern that this bill may not move forward and that the urban blight certification may not be approved. Their concern is they may not have a facility with a parking lot that will accommodate their needs. We have been attempting to work with the community. About a year and a half ago when L and I at my direction were going through the neighborhood from Federal Street to Reed Street from Fourth Street to Fifth, I directed License and Inspection to do a survey of the neighborhood to identify any properties that may be in need of repair or to be 47 BILL NO. 990331 demolished. As a result of their survey, several properties that are owner occupied were slated to be demolished. At that moment, a great awareness by the community became known. We were contacted -- when I say we, I speak to myself and Jeremy Newberg and the other members of the Jefferson Square CDC. We were contacted by a group known as the St. John's Episcopal Community Group. I believe I'm pronouncing that correctly. Are you correcting me, Gina?
Thank you. St. John's Leadership Team. They were concerned for the community and the residents, many of them long-time residents, what would become of these people should the hospital facility be occupied by Kessler, should condemnation move forward. We explained to them our plan. We explained to them that we would work with them. We explained that there were certain things that we could and could not do, that there were certain federal regulations that required notification, funds for relocation of families that may have to be relocated. Several meetings took place. I believe 48 BILL NO. 990331 I attended two of those meetings. I was not able to attend all of those meetings, but in my place, Jeremy Newberg who has been the point person for me through this whole process for the last three years attended those meetings. And I assured everybody that when Jeremy spoke, he was speaking for me. The problem we have today is that I don't have a deal with Kessler in writing. And this Committee will have to make a decision whether or not we move forward with the bill that would ultimately require condemnation of houses that are occupied, but may not necessarily be needed because we may not need a parking lot. I'm going to move that we hold this bill 16 until September. One, it will give me more time to work with the community. Two, we hope to have either this tenant or another tenant in place and we will then know more specifically what the parking needs of the future tennant, should it not be Kessler, may be come September. But I do want to mention that I attended a couple of meetings in front of the Planning Commission. One had to do with blight certification, the other had to do with the approval 49 BILL NO. 990331 for the urban renewal area. And they were very heated conversations, obviously, and a lot of things were said. The one thing I want to assure everyone in this room, and especially this Committee, is there has never been anything done slight of hand, there's never been anything done out of the view of the public. There have been a number of stories written in the South Philadelphia Review, in the Philadelphia Inquirer, and I also believe in the Philadelphia Daily News about this proposal. I understand the emotional sensitivity of people who may have to be required to move from their homes. We are going to make every effort, and we have been trying to get through to these folks, to make every effort to let them understand that we intend to do as much as we can to see that those folks are relocated within the community. The first plan that we had presented in the June of 1996 literally was a conceptual plan that showed basically all of the homes from Reed Street north to Manton, from Fourth Street to Fifth Street being taken out and replaced with new housing. That was just a conceptual plan. Since that first scheme, eight other schemes have 50 BILL NO. 990331 evolved. The schemes have changed basically because of the concern and the questions and input we have been getting from the community. If you will look at today's scheme, and I hope I have it up here. I think it's behind the one on the easel now. You will see we have reduced the number of houses dramatically down to somewhere between 40 to 70 new houses from an original figure of -- and I'm looking over at Mr. Newberg. I can't remember the original number of homes, but it was significantly more. I think it was more than 70 if I'm not mistaken. What we are attempting to do is to see if we can keep as many homes that need minimal rehabilitation to purchase those homes and make those homes available to those folks who may have to be relocated from the two streets that may be the area where the new parking facility needs to be constructed, and they are the 1300 blocks of Leithgow and Lawrence, South Leithgow and South Lawrence Street, in addition to other folks who may have to be located or may want to be relocated to make way for some new housing.
The scheme that we have now is not in stone. We are still working on it. We are tweaking 51 BILL NO. 990331 it. We are finding out what we need to do. We want that input. But we will never be able to move forward and make the quality of life in that community any better than it is today if we don't all sit down and discuss this and make some decisions realizing -- and I've been haunted since the day I first said this -- that for some folks there is some pain. It doesn't make me happy to say that, but I have said that. I've been accused of being a heartless person. But it's a fact, it's a reality that sometimes folks may have to be relocated and there's a pain involved in that. AUDIENCE MEMBER: Mr. DiCicco, we're unique --
Ma'am, you will have an opportunity to speak. AUDIENCE MEMBER: We don't have a vacant property. You have it down as a vacant property, and it's a commercial property.
We are going to sit and discuss with all folks, those people who live in occupied houses, people who don't live in 52 BILL NO. 990331 houses, their vacant buildings, vacant properties, commercial properties, residential properties. In the last three or four weeks we have ceased negotiating to buy any occupied properties because we don't want to be accused of making a deal that may be less of a deal than you can get should you decide to sell by way of the Redevelopment Authority. So the Jefferson Square CDC is only looking to purchase vacant land and vacant buildings going forward. The other properties that are occupied, those deals will be negotiated between the property owner and the Redevelopment Authority. And that was explained at a June 5 meeting of which about 200 people attended at the George Washington School at Fifth and Federal. At the request of the Planning Commission, we held up on voting the bill 18 out of the Planning Commission until we met with the community, and that meeting lasted about two and a half to three hours, if I recall correctly. I had everyone from the Redevelopment Authority, the Department of License and Inspection, the Planning Commission -- I'm trying to remember the other agencies -- L & I, myself included convened that meeting. We opened the meeting up for questions. 53 BILL NO. 990331 There with questions and answers. We took notes of questions we did not have an answer for. We have made you part of the process. I know some of you will disagree with that, but somebody has to make something happen here. And politically, this is not a good thing for me because I've made a considerable number of enemies in that community. But I didn't get elected just to make friends. I ran for office because I hoped to make a difference, and I hoped to make a difference in everyone's life in a positive way. I'm sure we will disagree on the avenue I have taken, but I have taken a leadership role in this community and intend to see this go forward. And I will work with every person, either individually or collectively, to see that you you are all made whole and that no one gets the short end of the stick in the negotiation process. And I stake my reputation on that, and I've been involved in this business for about 32 years. And as I said earlier, I still live in this community. I just built a new home six blocks away from the Jefferson Square community. I'm familiar with what this neighborhood was, what it is, and I have a vision for what I'd like to see 54 BILL NO. 990331 it become in the future. The chart to my left indicates the area between Reed Street and Federal from Fourth Street to Fifth Street. And if you look at the chart, the green indicates vacant lots. The gray area are the habitable properties. The blue are the blighted properties. And the black indicates the area which is everything in here for the -- the black indicates, the little dots on these other properties that maybe red, green, or gray indicate the proposed urban renewal taking. As you can see from this chart, there is a significant amount of vacant land. Much of this land, as I said earlier in my testimony, became vacant as a result of the Graduate Health Services land banking over a series of 10 or 15 years and basically not paying attention to the needs of the people who lived in this community. They basically bought properties, let them deteriorate and really didn't give a damn about what happened to the people who lived in this property. What we're faced with today is a lot of blight, a lot of vacant properties, and a lot of structural damage to houses that are occupied today 55 BILL NO. 990331 because of the properties that were demolished next door to them and there was no concern for the structural integrity of the properties once those buildings were demolished.
This was not property owners who live in them, those properties today were not their fault, but as a result of the Graduate Health Services and their ambition to take over this community for the purpose of hospital expansion without considering the community. This chart represents scheme No. 8. Remember, we started with scheme No. 1, and I think we're working on scheme No. 9. I don't know what the final scheme will be, but we'll keep working at it. What this plan shows is the same area I described, but you will see in this area especially up in here along Fourth Street and along Fifth Street on the east side. I'm little bit color blind. I think this is like -- I don't know what color that is, actually. It's not the green. It's olive. Thank you. In the first scheme, which I don't have with me today, none of those properties existed. Everything became new. But we have changed that 56 BILL NO. 990331 because we understand that should this parking lot become necessary, Leithgow and Lawrence Street which are here would have to come out to provide for the parking spaces that are needed for the hospital facility. What do we do with the folks who lived here 30, 40, 50 years? It's traumatic enough for them to have to be relocated. How do we keep the folks in this community, how do we keep them in the community going forward? What we did was we looked at the properties on Manton Street between Fourth and Fifth, and we realized that there are a significant number of properties there that are in pretty decent shape and require a minimal amount of rehabilitation, as we did with Titan Street and properties all along Fourth and Fifth Street. We thought that this might be an opportunity for some of the folks who live on these streets to be relocated to. They're not being moved to North Philly, West Philly, Southwest Philly; they're still part of the community that they've been involved with for a number of years, decades in some cases, and be relocated to homes that are either similar and in some cases will actually be an improvement to 57 BILL NO. 990331 the condition they're living in today. Scheme No. 9, which I mentioned that we have not finalized yet, we're looking at possibly where we're showing -- by the way, these are new construction; these are twins. We were looking at maybe not doing a set of twins here, but doing a contiguous number of homes, maybe six homes here in the same fashion that the other homes on Fourth Street are, typical row houses, for the folks on either Leithgow and Lawrence that they may been relocated to. So we understand what relocation is. This has been a learning experience for me. I'm finding out that, as Jim Kenney would say, no good deed goes unpunished, and that it is not as easy as a dream and a vision to accomplish. There are people, there are lives here, and we are making every attempt to address their needs. This is just an artist rendition of what we hope the new housing will look like. They will be three bedroom, 2 bath homes, side yard, rear yard, either a carport and/or garage. Jeremy Newberg will at some point during his testimony explain to you the price of the houses, who can 58 BILL NO. 990331 qualify for these houses, what we will do in terms of low interest loans to accommodate people who live in this community who may have a desire to buy one of these new homes. The big plan for me was, as we begin to develop this -- and by the way, this Committee heard testimony a couple weeks ago with the Martin Luther King Revitalization Project. This is very similar in terms that we are dealing with people's lives and relocating people. That is being pursued by the federal government in their ambition to remove high rise public housing units. This is my plan. This is my plan. This is not a government-generated plan. There will be some government money involved in it, obviously. There will be a considerable amount of subsidies that go into this project, but this was my plan, this was part of my vision.
So I take full responsibilities for what happens here. As you know, I lobbied the Administration about two years ago, and the Mayor put in the capital budget a year ago $3 million for land acquisition to begin this process to move forward to begin to create home ownership opportunities for low moderate income families. 59 BILL NO. 990331 I think that probably closes most of the statements that I wanted to make. And I'm sure that during the hearing, the rest of the hearing, I may want to add a comment or two. Thank you, Madam President.
Thank you very much. I know that -- I'm speaking for myself. I certainly want to thank you for giving us this history. And it's quite evident that you have worked long and hard to come to this. It looks beautiful to me. Do you want to call the witnesses and have them on record?
I think I'd like to, if I can, call Mr. Newberg up because he can fill in some of the issues on what we've been doing in terms of notification and discussions we've had with some of the community and also some of the financing issues, and then we can go onto the normal list of witnesses from there. Thank you.
My name is Jeremy Newberg. Just to summarize what Councilman DiCicco said, the 60 BILL NO. 990331 Jefferson Square plan consists of up to 70 new construction houses which will be built in a semi-detached concept with off street parking, front and side yard, approximately 1350 square feet. It will be priced at $85,000. With the current Delaware Valley Mortgage plan loans and the evolution of much more affordable mortgages for first time home buyers, a family could get in with a 97 percent mortgage, and some situations even more probably with about 2500 down, maybe a little bit less. Minimum income would have to be 28,000. That is at 80 percent median income. This is targeted to a moderate income. In addition to the 70 new houses, there will be up to 80 rehabs of owner-occupied housing. Philadelphia does not have a particular strong record of funding owner-occupied housing because it's a very difficult task and it's very expensive. A major philosophical value of the Jefferson Square plan is that it is based on revitalization which is to benefit existing residents as much as creating opportunities for new buyers. So you have to do owner-occupied rehab; it's absolutely critical. And we will raise the additional funds to do that, 61 BILL NO. 990331 either through a combination of grants and/or low interest loans depending on the full scale of the repairs that a family wants to do. The third component is the reconfiguration of the Mt. Sinai Hospital campus which will include 37 new units of low income housing. We want to set these rents at $325 a month, and for certain senior citizens on a fixed income, we will work with the Housing Authority to get an additional subsidy particularly for very low income senior citizens. We have many people in the neighborhood who only make between 800 or a thousand dollars a month on a social security check. So we want to be sensitive to those needs and provide a financing structure so that they can be served in a unit that is new, that has security, that is clean, and has sunlight. In addition with the reconfiguration of the medical tower and also the administration building, we have the potential to bring 300 new jobs to this neighborhood. These will be health care in personal care. They're going to serve -- these are going to be jobs that will be accessible to people in the neighborhood. They will not all be high-end professional jobs. They will be accessible 62 BILL NO. 990331 jobs for people on working incomes and we will do everything in our power to make sure that people from the neighborhood get access to these jobs. Finally, we want to create a homeowners' association that will work with us in creating community gardens and block patrols and preserve the investment that's been made. We have five guiding values. One, a healthy neighborhood includes housing that serves people who are in a range of low and moderate incomes. The City's had a very impressive track record of doing new construction, new configuration types of housing. Often it's assisted with federal subsidies, typically, home or community development block grants passed through from the federal government. But if you think back of the neighborhood where you grew up and go back 30 years, maybe 40 years, there may have been someone making minimum wage living pretty close to maybe a neighborhood merchant, maybe a doctor. What I'm trying to say is if you think about the old row house neighborhoods, people earned a range of incomes in the older row house neighborhoods. What's happened with the demographics of our City is 63 BILL NO. 990331 that people earning moderate incomes and, yes, higher incomes have moved out. We're not about a gentrification project; we're about a revitalization project. But to do this you need to avoid producing housing that exclusively serves very low income people. " Our goal is balance. Secondly, we're entirely focused on home ownership.
South Philadelphia has been negatively impacted by properties particularly on the north/south sites Third, Fourth, Fifth, Seventh Eighth, that used to be merchants and then the owner living on the second and third floor. Well, they often fall prey to being chopped up into three residential units, sometimes 4, whether or not they meet code, and then the landlord can bring in whatever types of renters. That is a destabilizing force. We want to focus on home ownership. Third, any new construction that will attract new residents should be balanced with access to funds for rehabilitation of houses owned by existing residents. I just can't emphasize this enough. The Jefferson Square plan is much more than just new housing, it is up to 80 units of 64 BILL NO. 990331 owner-occupied rehab. Fourth, we have a responsibility to address the needs of senior citizens and long-term residents of the neighborhood with sensitivity and respect. Well, we've met with people from the neighborhood, people who present themselves as leaders, representatives. Yes, we have many arguments, but there's one message that comes out very clear that we hear, and that is, be sensitive to the needs of senior citizens, take the extra time. And we will do that. Fifth, we seek opportunities to sell as many of the new houses as possible to existing residents and their family members who have long-term relationships with the neighborhood and are committed to contributing to its revitalization. This is a point that gets lost. " Well, if you don't make a combined income of 28,000, it's difficult. However, there are a lot of people that go to church in this neighborhood. A lot of people have moved away from the neighborhood but they still go to church. They may work for the 65 BILL NO. 990331 City, they may work for other industries, but they have a relationship to this neighborhood. We want to create a new modern house that meets their needs and encourage them to move back to the neighborhood. " It's sort of a puzzled look. But we have a good year before the first houses come on line. We should be meeting with these people, pre-qualifying, seeing what the issues are, working with home buyer education providers so that we can get on plans to get them pre-approved for these mortgages. But that is our focus, is to sell as many of the houses to people from the neighborhood or have a connection to the neighborhood as possible. I'm going to brief today and I'm actually go right to the conclusion. As you think about this plan as you listen today, if you keep four points in your mind as you think about voting for such a project like this. Before you vote, please review the pictures of the blighted houses and the vacant hospital and Mt. Sinai. Maybe take a 66 BILL NO. " 9 This is a bold plan, it's a new plan. 10 It's a non-traditional type of affordable plan. It's really more of a neighborhood revitalization plan. But it would be a profound act of leadership if you were to vote in that manner. Secondly, we will take whatever time is needed to manage the relocation process with sensitivity and dignity. On a personal note, my mother was a social worker. My mother was a drug and alcohol therapist. My father's been in public education for his whole career. I did not get into housing to disrupt people's lives, but I do understand what a neighborhood like this needs in terms of getting on a firm footing to be successful for another 30 or 40 years. It needs some changes. We are committed to working with residents in a sensitive and dignified 67 BILL NO. 990331 manner to reach that goal. Third, our goal is that every neighborhood who makes a sincere investment in the community will benefit from the revitalization efforts of this plan. Finally, your vote to approve the urban renewal plan will enable us to complete the site acquisition and move this plan forward.
Your vote will help us move from a plan of promise to a plan that was realized with performance and benefit for the neighborhood. Thank you.
Thank you very much. I was called out of the chamber, and I did not hear all of your testimony. It's my understanding that the proposal is for 40 to 70 new homes. How many people would have to be relocated?
For the new houses there are -- and this is just the new houses, not the parking. We have identified houses where we are 21 requesting owners of existing properties to move. 22 We don't want to use that power. And we want to go 23 embark upon a process where we'll meet with each 24 family, and these are predominately senior citizens, 25 to ask them "what are your housing goals and 68 BILL NO. 990331 options," and that can be a bit of an offensive question to ask someone who's lived in a house for 30 or 40 years and paid off the mortgage. I don't take that lightly. But if you're just one house standing amidst all other vacant houses on a lot, it's holding up a project. What we offer in return for the relocation, the full federal benefits and then some. And when we say then some --
I think for the audience, they should know that.
I'm not an employee of the Redevelopment Authority. So to the best of my knowledge, I'm going to give you what I know of relocation benefits, okay? But there are various nuances to it. First, you're offered fair market value for the property, full fair mark value. If you disagree with the price, you are actually given funds to hire an appraiser to contest the price and then you negotiate. Secondly, you're given up to 22,500 hundred dollars if you cannot find a comparable house to the one you're living in and 69 BILL NO. 990331 then all your moving costs and settlement costs are covered. With the renters, if they're relocated, it's a little -- the formula is a little more complex. You're essentially given subsidies to find a comparable rental unit where your rent does not exceed 30 percent of whatever you pay for the next five years. Our goal, our standard, is that if you want to stay in the neighborhood, we're going to work with you to find a house within five blocks of where you live now and preferably within the target area. And that's going to take a lot of work, but that is how we hold ourselves accountable to our values that we want to preserve as much of the neighborhood character that's positive as possible and keep as many existing residents in the area in housing that, one, meets health and safety code, and two, the new house you move into you're paying a comparable monthly housing payment to what you were paying before, unless you choose to upgrade.
How many units are being proposed for senior citizens?
The Mt. Sinai Apartment building will be 37 units that will be reserved for 70 BILL NO. 990331 senior citizens aged 62 and above. We are what's known as the special limited partner. We are the non-profit that the Michaels Development partnered with. Our role and responsibility is, one, to monitor construction quality, and two, to assist in the coordination of the lease sub process so we reserve the maximum amount of units for people from the neighborhood to move into the Mt. Sinai Apartments. These will be gorgeous apartments.
And with the many meetings you've had with the community, has this been made clear to the seniors and have any of them expressed a desire to be relocated to the units?
Your question in broader terms of how people support this project. At first in conversations with senior citizens on Leithgow Street on the 1300 block, they didn't really know what's all involved in this type of project. Quite frankly, it was perceived as a public housing project. It's not. It's privately owned. The standard of construction is very high. You're not entangled with public housing regulations. You can do maintenance and do much better property 71 BILL NO. 990331 management. And rest assured, as the special limited partner, we'll make sure the property is accurately maintained. We are planning a rooftop garden. The developers are trying to get some land in the back for a patio and breathe space for the apartment. But it speaks to a broad issue which is we didn't put together a large group of supporters for this project today. We didn't want to rally. We didn't want to show a force. Most of the people in the neighborhood have known each other 30 or 40 years. Doesn't mean they get along. They do know each other because they're from the hospital. There's quiet respect and caution. There's a reserve that we're not going to get too far out until we see some performance. So neighbors, when we met one-on-one are quietly supportive. In a group they hold their comments. I would say that's fair given the difficulty these residents have there.
Thank you. The Chair recognizes Councilman Nutter.
Thank you, Madam Chair. First, it's Mr. Newberg, is that correct? 72 BILL NO. 990331
I heard your request or suggest that Members of the Committee tour the site or look at the pictures. Just for the record, I want to let you know I've already toured the site on my own because I've known about this project for a little while, the proposal, and I wanted to see the area for myself. I have walked the different streets that are proposed to be affected by this project. Now, to the best of my knowledge, you and I don't know each other, right?
I need to ask you a few questions by way of background. I have not met with you. I've read the proposal. I think it has plan No. 8 attached to it. But can you share with us by way of background and experience who you are in the whole scheme of things and what is Capital Access?
Sure. I was born and raised in Philadelphia. I went to a school --
I don't want to go back that far. We can talk about your adult life. 73 BILL NO. 990331
Sure. I've been in housing in my professional career years 4 experience in it. I started with an organization on 5 the West Coast. There I got involved in developing 6 purchase rehab programs for scattered site housing 7 in predominately working class neighborhoods where 8 what we were trying to do was mix public subsidy 9 with private bank financing to revitalize blighted 10 houses in East Oak Lane, West Oak Lane, South 11 Central Los Angeles and also we were in Kansas City 12 and Baltimore. From there, I went to work for the Federal Reserve Bank, did a lot of training for banks in community reinvestment, but I missed doing deals so I moved back in '93.
I trained bankers. That was in the nine western states. But I missed actually doing deals, doing projects. So I went back to Philadelphia to CoreStates for two years and again got very involved in financing developers that would do both non-profit and for-profit scattered site purchase rehab neighborhood facilities. I've always been involved in projects that involve some 74 BILL NO. 990331 type of neighborhood revitalization and affordable housing component. In '95 I started Capital Access, my own consulting company. We do FHA mortgages. I originate multi-family loans using the FHA. I'm currently funding two projects in University City. I just closed a $6 million project in Columbia, South Carolina. We did a $3 million project in Wallingford. The second service that we provide is the development consulting, which is what I'm doing with Jefferson Square, where we are essentially a project manager and we help non-profits move through the funding and development process. And then, finally, I do training and technical assistance.
This last service you provide, training and technical services, can you expound on that I a little bit?
Sure. The training and technical assistance is funded through the Home Technical Assistance Program, which is a national funding. I'm actually subcontractor to a national contractor, the Development Institute out of Baltimore. But this is what we do, I try to work 75 BILL NO. 990331 with local governments that are struggling with how to come up with a housing strategy to get the most housing for their housing subsidy dollar. We just completed the City of Bloomington, Indiana, where we did scattered purchase. The challenge is to train the staff in basically the same development responsibilities and the same development skills that a non-profit has to go through.
Okay. You indicated that you have about years of experience and you 12 said the bulk of you life's work has been in housing. Based on that, is it fair to say that the bulk of your housing experience has primarily been on the finance side of housing as opposed the construction side of housing?
Finance and planning, right. I do not have specific construction management skills. My role has been to get this project started, to get it funded, to get the properties acquired, to go through whatever rezoning and community design and community approval is needed. Then a larger builder needs to be brought in to manage the mechanics of construction. If they want sales and marketing lease up, we can 76 BILL NO. 990331 participate in that.
I understand. In that regard, and that was the next area that I wanted to go into, you made reference to some of the other projects that you have. Are any projects that you have worked on or currently working on that are similar in scope or magnitude to this particular project?
In terms of the scope and magnitude, this is the biggest. In terms of the application of the concepts, we completed last year a program in Tallahassee, Florida, where we were working with the City. There were several vacant lots in an area known as Frenchtown near the Florida State University campus where there were vacant lots blighted and we put together a development plan for a non-profit to access home subsidy funds, private bank financing, to develop the mechanism to produce new construction houses over the next five years.
For this proposed project, what are the total estimated project costs?
It's a movable target. The reason is because we don't know yet how much total acquisition will be. We operate from the 77 BILL NO. 990331 assumption that for every new house you have to acquire three row house lots. A row house lot is 4 feet by 44 feet. And so we're currently acquiring 5 lots for 4,000 a lot. A shell can go from 6 to 6 10,000. A house, depending on what the roof and 7 mechanicals are, we've been purchasing between 10 8 and 25,000. So I can't give you a precise figure. 9
Have you purchased 10 some property in this area already? 11
We have acquired 16 12 houses. We have 11 under contract. We have 23 that 13 are public sector owned for which we've made 14 requests to acquire, and as part of the bankruptcy 15 agreement with Allegheny, there are 21 houses not 16 including the parking lot that will be deeded to Jefferson Square. We've made significant inroads with 74 properties for which we have site control.
The property you started talking about initially, putting aside the Allegheny properties, those are all privately owned properties that you went out and struck deals with the owners?
Right. From September to the end of January we sent out letters. We've 78 BILL NO. 990331 created a massive database --
Myself, my 2 staff people. We are under the direction of the Jefferson Square Community Development Corporation.
When you sent the letters out, whose name or what organization's name was at the top? Who did the person get a letter from?
The Jefferson Square CDC. I am the treasurer and secretary of the CDC, so I signed the letter.
The letter said, "We're interested in redeveloping your lot or your shell. We're interested in purchasing it. Could we meet with you?" In bold letters we said, "The decision to sell your house is completely voluntary." Some people responded, some did not. We did about two or three mailings.
So let's get back to total project cost. I heard what you said in terms 79 BILL NO. 990331 of what you're anticipated owner occupied properties --
I can actually answer your question. If you had 1350 square feet union wage job, you're looking about 70 to $75 a square foot. So depending on what you can negotiate, you're looking about a hundred thousand dollars, to 110,000 to build the actual structure and the improvements. Acquisition can be anywhere from 12,000 to even as much as 45,000 because you have to buy three row house lots for one new and add on another percent 13 for various costs, so this project may cost between 14 150, 160 a unit. We're selling it for 85. The 15 reason we're selling them for 85, we want them 16 accessible to moderate income first-time home 17 buyers. 18
I understand that. 19 Are you only dealing with the housing rehab, or are 20 you involved with the Mt. Sinai component? And Councilman DiCicco earlier talked about Kessler who may or may not be doing something. Are you just involved in the narrow housing components?
I do not have an official 80 BILL NO. 990331 relationship with the owners of the Mt. Sinai campus. They have not -- they don't include me in on all their business meetings or the CDC.
Okay. Fine. In terms of the housing component of this particular proposal, what do you estimate the total project cost to be?
Including the rehab? The owner occupied rehab or new construction?
Total project cost for what you are proposing, for what you're involved in with the housing, what are the total project costs, new construction and rehab?
I'd have to qualify the answer as it relates to the rehab, the reason being we wanted to get through this process for the urban renewal plan because the next phase we have to do is we have to meet with every one of the owner-occupieds. We would like to go through rehab. I don't have a hard fast number today on that amount.
Fine. What is your proposed funding to do this particular project?
Had that been testified to earlier, Councilman? Did you say that?