That would represent again 44 million of the $50 million in acquisition?
I guess what I need to figure out very quickly is some line item in here that has to do with -- we can call it various Fourth District landbank or we can call it whatever we might want to agree to call it, but since the train is clearly moving out of the station and most of the dollars have been allocated in fairly significant fashion in some places, average being somewhere in the to $3 million range, then we should have some 161 1 12/6/02 - NTI FY '03 Program Statement and Budget discussion about making an amendment to this particular budget, since we are in a budget discussion, to designate a certain amount of more relevant dollars to the Fourth District, anticipating that there will be other acquisition needs that are not identified on this particular sheet and have that happen as a part of this larger budget process.
One of the reasons for the budget part of the program statement, it represents a total of 50 million and this shows basically the requests thus far, so we get your request in -- that's why I said it is as of the 15th. What we have not done is try to do a specific line item number by Council district within each budget because the thing was fluctuating up and down. And then the other thing, which is an oversight on my part, I haven't also included the Act 94 acquisition requests, which are a part of the budget, but I didn't break out. Act 94s tend to be in areas outside of -- not tend to be; they are in areas outside of urban renewal areas.
Since we are doing the budget and since we are significantly and 162 12/6/02 - NTI FY '03 Program Statement and Budget dramatically increasing I believe from $11 million in acquisition to I think it is actually now 46 -- is that what's in the program statement?
Right. Basically, as I said before, we are appropriating the entire $50 million this year so that we have enough budget authority to meet this and including -- as we said, there are other acquisitions that may be out there. It may all in the end exceed 50 million. That's why it is not a given that everything gets funded out of the next group. That hasn't been finalized.
I understand that, but I assume you can appreciate my intense interest in making sure that we are at least listed on the list and we will figure it out and I guess, as you said, if something doesn't go forward, it will go back in the pot or gets reallocated somewhere. Where I would not like to be is we are at $46 million today. You are clearly going to get more than $50 million worth of requests and then I'm on the list never to be completed. So I would like to 163 12/6/02 - NTI FY '03 Program Statement and Budget have an amendment to this budget that allocates a specific amount of money that I at least know is available for acquisition in the district. It is still within the $50 million cap for the moment and then on a going-forward basis it's there to be utilized and if for some reason we don't need it, we will deal with that at that time.
Since the average seems to be generally somewhere in the 1 to $3 million range, I think that we are probably talking about at a minimum $2 million.
I think it would appear we are going to be back here on Thursday.
I am anticipating we are not going to take action today. It's a little hard with three people. It's no stroke of brilliance or genius. Generally if there are only 164 12/6/02 - NTI FY '03 Program Statement and Budget three people left in the Committee of the Whole, we are probably not going to take any action at the moment. So if we could have some conversation about that and get to a number and have that ready for an amendment when we come back in session, I would greatly appreciate it.
And I will have people from the Redevelopment Authority sit down with you.
Thank you. Miss Smith, before we call in the next witnesses, we hear a great deal about market rate housing. Can you tell me if you or anyone from the administration has been in touch with Toll Brothers regarding the Naval homes on Grays Ferry Avenue?
Is anybody from Planning here? Yes, there have been conversations in terms of moving that project forward.
Good afternoon. Please identify yourself for the record.
My name is Victoria Mason-Ailey from the City Planning Commission. 165 12/6/02 - NTI FY '03 Program Statement and Budget Yes, we have had brief conversations, actually inquiries, with Toll Brothers.
Have the inquiries been on their part or our part?
Our part, Madam President, to find out exactly what their intent is at this point. Rich Lombardo, our deputy executive director, has initiated those inquiries, but they have not been as fruitful as we had hoped in terms of any definitive response or direction in either way.
We have been in the process of looking at large development sites for development opportunities that might be meaningful for not only area developers but those in the region, and the Naval home site was one of the sites that the City Planning Commission has placed on the table for consideration and has been discussed internally. And so as part of that process we felt it was important to touch base with them to find out more definitively where they are with regard to their proposal or their concepts or their analysis 166 12/6/02 - NTI FY '03 Program Statement and Budget and there was no definitive response or additional information provided to Rich Lombardo when we inquired. It took us, I would say, several weeks to even reach the contact to get some sort of response, but Rich was determined --
Have they indicated whether they will get back to you?
And the information they gave was really not anything that they are going to be doing in the near future, I assume?
Correct. That is correct. I think we are looking to again maintain contact with them through Rich Lombardo and to try and again see if we can find out some more definitive information that would be useful to us and to our process.
Thank you very much. Are there any other questions of Miss Smith? Seeing none, our next witness will be Susan Sierra. Good afternoon, thank you so much for your patience. Please identify yourself for the 167 12/6/02 - NTI FY '03 Program Statement and Budget record and proceed with your testimony.
My name is Susan Sierra. I'm the policy coordinator for the Philadelphia association of CDCs and I want to thank you, Madam President, and other Council members for the opportunity to testify. I will be brief, particularly given the lateness of the hour. As has been discussed, this ordinance 10 transfers the entire 50 million NTI acquisition budget to the first year of NTI and the Philadelphia association of CDCs which represents 80 CDCs and other organizations that are working in neighborhoods to revitalize those neighborhoods certainly supports the increase in funds for property acquisition this year. However, we also believe that there is going to be a definite ongoing need for the City to continue to acquire vacant property in years 2, 3, 4 and 5 of NTI as well as into the future. As Pat Smith said, assembly and acquisition of land is the starting point for any development or redevelopment that goes on in the City. We definitely support the recycling of acquisition funds as has been discussed and are glad 168 12/6/02 - NTI FY '03 Program Statement and Budget that that is going to be going forward, but we are concerned that recycling of acquisition funds alone won't be sufficient either to meet the City's need for acquisitions in the future or to meet the City's need for redevelopment. Just based on the figures that have been given, there is clearly a diminishing rate of return. If $44 million is being spent on acquisition this first year, next year the City expects to get, as best case, 45 percent of that back and 45 percent of that back in future years. We are looking at $20 million for acquisition next year, 9 million in year 3, less than 4 million in year 4, less than million in year and there is clearly going to continue to be a need for assisted condemnation and for property acquisition into the future. Without this funding, the redevelopment of many City neighborhoods will stall and the City is also going to be risking the loss of opportunities to leverage a great many millions of dollars in outside funding such as low-income housing tax credits and the home ownership choice program. In addition, eliminating funds for 169 12/6/02 - NTI FY '03 Program Statement and Budget acquisition in future years is going to lead to a significant loss of capacity among Philadelphia CDCs and will lead to in the end missed opportunities to stabilize prior investment in neighborhoods and to revitalize our City. We therefore believe there needs to be a predictible stream of revenue beyond recycled funds to support property acquisition into the future including funds earmarked for CDC projects and we would like to urge the Mayor and Council to move as quickly as possible to address the issue of acquisition funding in future years and to allocate sufficient funds to meet this crucial need for our city. Thank you.
Thank you very much. Are there any questions from members of the committee? Thank you so much for your patience. Debra, I want to ask a question if I may. I'm very interested in properties being rehabbed. Will those monies come out of OHCD's budget? I don't think we have to demolish every vacant structure in the city.
I'm sorry. I just want to make sure I understand the question about rehab. 170 12/6/02 - NTI FY '03 Program Statement and Budget
Rehab. As I said, there are properties that in my opinion necessarily do not have to be demolished. Are there dollars in OHCD's budget for rehab of properties, vacant properties?
There is our regular budget that has specific programs that include rehab. There is not just a general line item for rehab of, if you will, any vacant property. Part of the consolidated plan which includes the NTI budget and the community development block ramp budget includes, for example, the budget for encapsulating properties. It includes program budgets like the home ownership rehab program, which rehabs vacant structures. It includes the Home Start program budget which rehabs vacant houses through that specific program. So in the specific case of what Susan was talking about with the CDCs, we work with the CDCs. When they identify projects and properties, they go through our process and in some cases those are funded, the rehab is funded through OHCD, but there is not just a separate line item for rehab that isn't connected to a program. 171 12/6/02 - NTI FY '03 Program Statement and Budget
Okay. Thank you. Our next witness is Judith Robinson from the Strawberry Mansion Civic Association.
Thank you for your patience. Please identify yourself for the record.
Judith Robinson, Strawberry Mansion Civic Association, and I'm specifically here today to talk about community participation, which is very important. Over the years, as I have seen amendments to OHCD's budget printed in the newspaper, I have always responded. So, therefore, this is no different. With NTI having amendments so soon, I'm just concerned that the community is not aware of the changes and I wanted to know what kind of outreach has been made to make sure that these changes, whatever they may be, that the community is aware of them. I find just from looking at other amendments in the past that if maybe there was more thorough planning, maybe a lot of these amendments would not have to be made. I'm just concerned that 172 12/6/02 - NTI FY '03 Program Statement and Budget these things are done after like a formal process, then money is changed or redirected after the formal process, and I'm kind of glad to know that that can be done because I have some suggestions where maybe money would be reallocated, increased in one area, reduced in others. The CLIP program should be throughout the city. There is no community in Philadelphia that could not use the CLIP program. So I would hope that, if expanded, maybe you could tweak it for various other areas as to what is happening in the Third District, but it definitely is needed throughout the whole community. In addition, I know predatory lending package has not been -- the details have not been revealed, but that is another area where there is definitely more need, so if money can be or amendments can be made and money can be increased or decreased, then that is an area that certainly can warrant some increase. Regarding acquisition of property, of this land, I contend that marketing of this land should be happening now since in the Fifth District a large -- many parcels I should say of land has 173 12/6/02 - NTI FY '03 Program Statement and Budget been acquired or is in the process of being acquired, so since we know that, why can't that land be in the process of being marketed now? The last time I checked there were about steps. There was an article in the Inquirer that 7 had 13 steps to dispose of a vacant lot and just 8 with my background I was able to combine it into a 9 five-step process because it was redundancy. First 10 they went to RDA and got information and then they 11 went back to L & I and got some other information. 12 All of that could have been done at one swoop. So I 13 was able to reduce that to five steps. If we are going to kind of get out of this muck and mire and all of this red tape, I think we need to reduce some of those processes. I'm very much concerned about emergency demolition. I see where there has not been an increase in funding for that. I'm concerned because in Strawberry Mansion we over the summer had many meetings and workshops and the communities were very concerned that they were not a part of the planning prior to demolition, so I want to make sure that this emergency demolition is not a way to get around a process, and I'm not thinking of snakes in the 174 12/6/02 - NTI FY '03 Program Statement and Budget woods somewhere, but I'm talking about just people wanting to move forward with demolition because that's where the money was supposed to be spent and don't want to really have to deal with the hassle of the community participation part. So I would like to know if there could be documentation of this emergency situation as it relates to demolition? Because I have seen an increase in value. So I'm concerned about that. I want to make sure that properties that are being considered emergency demo are in fact in such a condition and it can be documented, that we should be able to find that out. We all should be on the same page and say, yes, this is definitely an emergency situation. Encapsulation.
My councilman asked about a process to reduce the cost of rehab and I know for a fact if properties -- some of these properties were just cleaned up and maybe have a roof put on them, maybe some basic systems put in, that they could qualify through FHA 203-K program. That's where a buyer goes out and gets their own mortgage and there is also money for repairs in that mortgage. 175 12/6/02 - NTI FY '03 Program Statement and Budget A substantial number of these properties could make it through that process where the City doesn't have to spend money to subsidize the whole process. If they could just get in, do some early intervention and encapsulate, they could certainly go on the market for a 203-K process. In addition, the wrap-up insurance I thought was supposed to be to help smaller contractors that really couldn't afford this insurance, but what I'm finding now per an article 12 in last week's paper is that the specs have eliminated, the new specifications have eliminated contractors even applying, so I'm a little concerned. I would respectfully request that you all look closely at how this money is being spent for insurance when the people or the contractors that were supposed to help are not applying. I'm concerned about African-American contractors participating. That is very important to me, especially when you see the cost of one house to be demolished. Overall cost is 14,000 per house. So I'm really concerned that the specifications put in place are excluding when we are requesting inclusion. 176 12/6/02 - NTI FY '03 Program Statement and Budget I thank you very much for your time and attention.
You're welcome. Any questions or comments from members of the committee? (No response.)
Miss Smith, I would suggest that you at the end of the meeting, if you wouldn't mind sitting down with Miss Robinson to go over some of her concerns, please?
Thank you very much. Do we have anyone else to testify on this resolution? Mr. Rothstein, I'm sorry to hear that you are leaving City administration. I want to publicly thank you for being such a great asset. We really appreciate it and hope that your future endeavors will be very successful.
Thank you. This committee will stand in recess 177 12/6/02 - NTI FY '03 Program Statement and Budget until Thursday, December at 9:00 a.m. (The hearing adjourned at 2:10 p.m.) 178 12/6/02 - NTI FY '03 Program Statement and Budget I N D E X Testimony of PATRICIA SMITH 3 SUSAN SIERRA 167 JUDITH ROBINSON 171 179 12/6/02 - NTI FY '03 Program Statement and Budget CERTIFICATE I HEREBY CERTIFY that the foregoing proceedings of the Committee of the Whole of the Council of the City of Philadelphia of December 16, 2002, were reported fully and accurately by me, and that this is a correct transcript of same. ______________________________ Cynthia A. Whyte, RPR (The foregoing certification of this transcript does not apply to any reproduction of the same by any means, unless under the direct control and/or supervision of the certifying reporter.)