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HomeMy WebLinkAbout1994-06-29 EHA MINUTESe L CALL TO ORDER ENGLEWOOD HOUSING AUTHORITY BOARD OF COMMISSIONERS REGULAR MEETING JUNE 29, 1994 The Regular Meeting of the Englewood Housing Authority Board of Commissioners was called to order at 6:05 p.m. on Wednesday, June 29, 1994, at 3460 South Sherman Street, Suite 101, Englewood, Colorado, 80110, by Chairman Thomas J. Bums. II. ROLL CALL Members Present: Members Absent: Also Present: Thomas J. Bums, Chairman • Norleen Norden, Vice Chairman Sheri Gulley, Commissioner• Matt Innes, Commissioner Bradley Zieg, Commissioner None Guy M. Blasi, CPM, Housing Manager -EHA Paul Malinowski, Executive Director Mary A. Ryan, Recording Secretary • Chairman Burns and Commissioner Gulley left the meeting at 7: JO p.m. to attend the DRCOG hearing on the light rail system. m STUDY SESSION Background information on the Study Session topic, the WHERE Mobile Home Parks, was given by Executive Director Malinowski. He reported to the Board that effective April 25, 1994, the EHA entered into a management agreement with WHERE to manage three mobile home parks on South Santa Fe Drive: Roundup, Royal, and Oasis parks, collectively known as the WHERE mobile home parks. Guy Blasi, CPM, was present at the Study Session to present more information to !~e Commissioners and answer questions they had. Mr. Blasi presented a video he had done of the three mobile home parks which showed the condition of the mobile homes, the parks' grounds, and access roads. Mr. Blasi explained that WHERE consisted of 53 mobile homes, the vast majority of which are rental units. Assessment of the projects' records, financial status, and maintenance needs was currently very labor-intensive and still not complete. A temporary bookkeeper was hired to write checks, pay bills, keep a cash flow statement, receive and receipt rents and set up tenant files for the parks. Discussion ensued regarding the corporate status of WHERE. Executive Director Malinowski stated that the Colorado Secretary of State reported to Wagenlander & Associates that WHERE was just reinstated as a non-profit corporation while the co-op is listed as "dissolved." Mr. Blasi reported that Mr. Wagenlander is researching the relationship between WHERE and the CO-OP due to the EHA's fiduciary responsibility. e e EHABOC Regular Meeting 06/29/94 Further discussion ensued regarding the leases WHERE was using. Mr. Blasi stated that it was the opinion ofEHA legal counsel, Jim Wagenlander, that it would be very difficult to evict anyone under the terms of the present WHERE lease. Mr. Blasi stated that the EHA had given all WHERE residents a 60-day notice that there will be a new lease to be signed. Ownership of the mobile homes and rental of pad space was discussed. Commissioner Zieg stated that he felt someone should call WHERE' s previous legal counsel to get information on the lease they helped set up for WHERE. · · Chairman Bums asked if the EHA had the right to review WHERE' s financial records under the Note and Deed of Trust for the loan WHERE has with the City's Rehab Program. Eld Malinowski said CHF A invoked the right to audit under their Regulatory Agreement. The condition ofWHERE's financial books upon commencement of the term of the Management Agreement was discussed. EID Malinowski stated that there were no apparent financial books kept by WHERE nor were there any balance sheets ever given to CHF A as required by their Note with WHERE. Commissioner Zieg stated that in his opinion small maintenance items such as the sheet metal work on the mobile home skirting could be taken care of in a relatively short amount of time. He further stated that the issues of access to the parks, the sewer systems, and electrical service needed to be looked at carefully in order to determine if the EHA wants to be more involved with the mobile home parks in the future. Chairman Bums asked if the mobile home parks had a feeling of"community" as was portrayed when the EHA became involved with the parks through the Rehab Loan Program and the CDBG Program. Mr. Blasi stated that there was a feeling of community with neighbors knowing who their neighbors were and watching each others' children. He stated he understands that there not as many police calls to the parks as there used to be before the CO-OP took over. Commissioner Gulley agreed with that observation. The Board thanked Mr. Blasi for his presentation. IV. MINUTES 2 Amendments to the Minutes of the EHA Board of Commissioners' meeting held May 25, 1994: Under Discussion Items, Motions and Resolutions, Agenda Item D -Foundation and moving contracts for Depot, the Board amended the Minutes to reflect that Commissioner Gulley excused herself from the meeting to avoid a conflict since she is the President of the Greater Englewood Chamber of Commerce. The Board further amended the Minutes to reflect that under the same agenda item, they (the Board) invited Ms. Gulley to come back to the meeting acting as a representative of the Greater Englewood Chamber of Commerce in order to answer a question the Board had regarding the long-term lease between the Englewood Historical Society and the Chamber of Commerce for office space to be in the basement of the depot when it is on its permanent site and renovation is complete. The Board also amended the Minutes to change the Motion regarding the train depot as follows: e EHABOC Regular Meeting 06/29/94 MOTION COMMISSIONER INNES MOVED TO GO FORWARD WITH THE TRAIN DEPOT PROJECT AND (1) OBTAIN A LETTER OF INTENT FROM THE ENGLEWOOD IDSTORICAL SOCIETY TO PURCHASE THE TRAIN DEPOT BUILDING AND LAND SITE IT WILL SIT ON FROM THE ENGLEWOOD HOUSING AUTHORITY; (2) OBTAIN A LETTER OF INTENT FROM THE GREATER ENGLEWOOD CHAMBER OF COMMERCE TO LEASE OFFICE SPACE IN THE COMPLETED TRAIN DEPOT ON THE GALAPAGO/DARTMOUTH SITE FROM THE ENGLEWOOD HISTORICAL SOCIETY ON A LONG-TERM BASIS. IF SUCH CONDIDONS ARE MET, IT WAS FURTHER MOVED THAT THE FOUNDATION CONTRACTS AND TRAIN DEPOT MOVE CONTRACTS BE SIGNED CONTINGENT UPON THE RECEIPT OF THE BILL OF SALE FROM THE PRESENT OWNER TO THE ENGLEWOOD HOUSING AUTHORITY. IT WAS FURTHER MOVED THAT UPON COMPLETION OF THE FOUNDATION AND THE TRAIN DEPOT BEING MOVED AND SET ON THE FOUNDATION AT THE GALAPAGO/DARTMOUTH LOCATION, THE BUILDING SHOULD THEN BE SECURED AND CLOSED OFF FROM WEATHER DAMAGE AND VANDALISM. COMMISSIONER ZIEG SECONDED THE MOTION. Ayes: Nays: Abstained: Absent: Bums, Norden, Innes, Zieg None Gulley None The Chairman declared the motion carried. MOTION COMMISSIONER ZIEG MOVED TO ACCEPT THE MINUTES OF THE REGULAR MEETING OF THE ENGLEWOOD HOUSING AUTHORITY BOARD OF COMMISSIONERS HELD MAY 25, 1994, AS AMENDED. COMMISSIONER GULLEY SECONDED THE MOTION. AYES: NAYS: BURNS, NORDEN, GULLEY, INNES, ZIEG NONE ABSTAINED: NONE ABSENT: NONE The Chairman declared the motion carried. V. PRE-SCHEDULED VISITORS There were no prescheduled visitors at this meeting of the Englewood Housing Authority Board of Commissioners. 3 e e EHABOC Regular Meeting 06/29/94 VIL Note: 4 DIRECTOR'S REPORT A. Narrative Report Chairman Bums asked about Mixed Housing Populations. EID Malinowski stated that Yvonne Gonzales, EHA Housing Manager, will be present for the Study Session at the July Board Meeting to present a report to the Board on this subject. The Board also questioned the Helso case and asked if that issue was closed . EID Malinowski stated that it was not a closed case. He stated that Jim Wagenlander would give an explanation of what is going on with this case for the July Board meeting since there have been further developments. The narrative Director's Report will be made apart of the Minutes of May 25, 1994, as exhibit "A ". B. Program Reports Briefly discussed was the Rehab Delinquency Report as far as the amount of money involved in the two loans shown on the Rehab Delinquency Report under the section showing loans delinquent more than 90 days. DISCUSSION ITEMS, MOTIONS AND RESOLUTIONS A. Chairman Bums and Commissioner Gulley informed the commissioners they would need to leave the meeting by 7:00 in order to attend the DRCOG Light Rail Hearing. The Board reviewed the agenda items for discussion and moved Item B forward for discussion among all board members before the two commissioners had to leave. These Minutes will reflect the order of the written agenda and not the order in which the items were discussed Hiring of an additional staff person or contract labor. At the May 25,..J994, EHA Board meeting, EID Malinowski mentioned that he would bring to this meeting a proposal to alleviate an extremely heavy workload in the Section 8 programs. Upon reviewing the study EID Malinowski performed of staffing of the most similar metropolitan housing authorities for the Section 8 programs only, the Board directed EID Malinowski to cure the understaffing problem in the way he sees best. Vice Chairman Norden commended EID Malinowski on the survey and found it to contain very helpful information. e e e EHABOC Regular Meeting 06/29/94 B. Establishing an Entity At the May, 1994 Board meeting, Commissioner Zieg introduced for discussion the possibility of "de-federalizing" money so that it is no longer in the Simon Center Account (for example) and no longer under housing authority investment guidelines by setting up a for-profit entity to more creatively utilize the Housing Authority's non-federal reserves. The Board decided to seek a legal opinion on the matter. EID Malinowski wrote the EHA' s legal counsel requesting an opinion on setting up such an entity (for- profit or non-profit) and transferring funds to it as well as the alternative of setting up segregated funds . The opinion from Wagenlander & Associates was handed out at the Board meeting for review by the Commissioners. Vice Chairman Norden clarified with Commissioner Zieg what was being questioned, i.e., (I) whether the EHA can take money out of Simon Center and put it into a different kind of account (a special project account) and thereby use it for projects such as the train depot; and her understanding ofWagenlander's opinion that this could be done; and, (2) can the EHA take that same special project fund and do different investment guidelines for it? Vice Chairman Norden's understanding ofWagenlander's opinion on this second part of the question is that this should not be done unless within the boundaries of state statutes. Discussion ensued regarding what guidelines Simon Center reserve funds fall under --federal and/or state. Commissioner Zieg felt that the guidelines set up by the EHA Board for the investment of housing authority funds were more restrictive than either federal or state guidelines and he wanted to know if the Board could make their investment guidelines less restrictive than they are presently but still follow state statutes. Commissioner Zieg cited as an example if the EHA sold the Elati Triplex, the proceeds would now be put into a Simon Center unrestricted reserve investment account and Treasuries would be purchased with the money. EID Malinowski went to the Minutes of the May 29 Board Meeting and reviewed what was discussed and related what his understanding of the questions were upon which he was directed to seek legal counsel, i.e . (I) Commissioner Zieg stated he wanted to consider a more entrepreneurial approach (to investing the EHA's unrestricted reserves). He (Commissioner Zieg) stated he felt the EHA needed to take its unrestricted reserve investment funds and give them to a totally separate entity which would not be under the EHA' s Investment Policy restrictions . . . whether it should be a for-profit or not-for- profit entity . . . should there be a separate fund. EID Malinowski stated he asked Jim Wagenlander (I) can the EHA set up a separate for-profit entity that would do all of our higher risk investing that would be de-federalized? (2) can the EHA set up a non-profit that would de-federalize investments? (3) can the EHA set up a separate fund that is de- federalized without setting up a separate entity? EID Malinowski stated that Wagenlander's opinion was that options 1 and 2 are possible, but if the Boards are the same for the two entities then "no" they would have to follow all housing authority regulations regarding investments . EID Malinowski also reminded the Board of the three main guidelines the EHA must follow with its investments and their order of priority, i.e ., safety, liquidity, and yield . Commissioner Zieg stated that he was suggesting that the EHA can change its Investment Policy for a specific fund . 5 e ---·-~-----~---~ ~---~~~------------- EHABOC Regular Meeting 06/29/94 6 Vice Chairman Norden directed the Board's attention to the last paragraph of Wagenlander's letter which stated that the housing authority has the ability to establish a special investment policy for non-restricted funds (which is what a Simon Center special project fund would be), and/or establish a separate account or pool of funds for special projects; however, the handling of such funds would still be subject to state law. The EHA could do an investment policy different from the HUD policy as long as it still adhered to state law and if the present EHA Investment Policy is more restrictive than state law then we could at least go to that. She asked Commissioner Zieg if that was his understanding and intent and he answered that he agreed and further expounded his understanding to be that in instances of special projects such as the train depot instead of taking money from Simon Center fund the EHA could have a fund (whether via a separate entity or just a separate fund within the EHA) to use for such projects and the EHA's Investment Policy could be changed for that particular fund and still comply with state statutes. He again stated that he felt the Investment Policy in place now was a fairly restrictive one that the Board wrote. He further stated that if someone said the EHA is "investing" in the train depot, the EHA might have a problem. EID Malinowski stated _ that he feels there is a difference between "investing" and "using" i.e. a "return on the money'' vs. "return of the money" Discussion ensued regarding the selling of the ground to be used as the depot site to the Historical Society being construed as an investment and the EHA receiving a return on their money in that ground. Commissioner Zieg stated that the EHA' s Investment Policy does not allow the EHA to invest in speculative land projects that will not be used for housing projects. It was stated that when the EHA purchased this specific parcel that discussion had ensued that it might not work for housing but the EHA could sell it and use the proceeds for housing somewhere else. Commissioner Zieg stated that someone "on the outside" could look at the EHA's Investment Policy and state that we had violated our own Investment Policy by purchasing this commercial property (property to be used for the train depot) and he wished the EHA had taken on the depot project with funds that couldn't be construed this way. EID Malinowski stated that regardless of what the EHA does with investments, he would like to see the EHA consider (1) taking funds from Simon Center's unrestricted reserves and set it up in a special fund to be used for community projects and then (2) consider how that fund ~ould be invested (conservatively or higher risk). Commissioner Zieg asked for a consensus to establish a fund that can be called "community investments" without having to establish a for-profit entity . The Board questioned how often projects such as the train depot might be done in the future to justify setting up such a fund and/or separate entity Vice Chairman Norden stated that she felt the issues to be decided were (1) how much of the EHA's reserves are to be put into the "community investment" fund and (2) what the policies for the use of this "community investment" fund will be . EID Malinowski stated that according to Wagenlander's letter, the Housing Authority has the ability to establish a special investment policy for non HUD restricted funds . The EHA could also establish a separate account or pool of funds for special projects; however, the handling of such funds would still be subject to those statutory restrictions e EHABOC Regular Meeting 06/29/94 imposed by state law. Wagenlander further stated in his letter that it was his belief that these investment restrictions under which the EHA operates are appropriate, prudent, and reasonable for public entities and they (Wagenlander & Associates) recommended that the EHA address its attention to how to best utilize these funds instead of trying to maximize its resources by accessing higher yield but higher risk investments. Note: Chairman Burns and Commissioner Gulley left the meeting at this point (7: 10 PM). C. Depot Status EID Malinowski stated that the information presented in the Board packet was informational only as requested by the Board at the May Board meeting. Commissioner Zieg asked if we were paying the mover to insure the structure while it was being moved . EID Malinowski stated that the mover will name the EHA as an additional insured on his policy. Commissioner Zieg asked what value the mover had placed on the building and since we are now the owner we should place a value on it for insurance purposes. He stated that if something happened to the building while it was being moved and we ended up with a foundation on the Dartmouth site that we could no longer use, we would need adequate insurance to remove the foundation and restore the site . Vice Chairman Norden asked what the timing on this project is now. EID Malinowski stated the contractor is scheduled for the first week of July to begin the foundation, the timbers for the dock have been transported to the Dartmouth site and the foundation permit is in-hand. He further stated that the moving contractor is at the mercy of his concrete subcontractor to finish up jobs they are on presently. D . Board Member Appointment Informational only. VIL FINANCIAL REPORT V/C Norden asked about the money collected from the public housing resident who had not stated all of her income and owed $6,000 to the EHA. She wanted to know if the EHA was able to keep all of that money or if they owed half of it back to HUD . EID Malinowski verified that repaid public housing funds belong entirely to the EHA as opposed to Section 8 Existing funds which would be divided half and half between the EHAandHUD. Further discussion ensued regarding the potential sale of the market rent units and the profit from the sale and where those funds would be placed. EID Malinowski stated that themarket rent properties are currently on SimonCenter' s balance sheet. Commissioner Zieg stated that he felt the Market Rent fund should continue under the EHA' s current Investment Policy. 7 -- e EHABOC Regular Meeting 06/29/94 X. B . 8 CONSENT AGENDA There was nothing under the Consent Agenda portion of this agenda to be presented at this meeting. GENERAL DISCUSSION A. Commissioners' Choice Vice Chairman Norden asked the Board for direction on the appraised values on the applications used by the Rehab Loan Committee to make decisions on loans. She was concerned about the accuracy of the "appraisals" and that they do not reflect the actual value of the home the rehab loan is to be used on. She stated that the Rehab Loan Policy says that we will loan up to 90% of the equity in the house . She stated that when there is a lot of equity in the house the method presently used to determine the value is acceptable (market comparisons with no adjustments). V/C Norden stated she was uncomfortable when there is just barely enough equity to support the amount requested in the loan application because if there is a default and the appraised value is wrong, a bad business decision might be made. Discussion ensued regarding value-enhancing items done with the rehab loan versus value-preserving items. Commissioner Zieg stated that he felt our underwriting is fine and that some items will enhance the value of the property while others will preserve the value of the property. V/C Norden stated that the Rehab Loan Committee is considering looking at other criteria, such as credit history and whether the items to be done will increase or preserve the value of the house when the equity is close. The Board members present stated they were comfortable with the 90% and the method utilized. V/C Norden thanked the Board for their direction. Director's Choice FJD Malinowski stated he had nothing to present for discussion under this item of the meeting's agenda. .. I ' • e e EHABOC Regular Meeting 06/29/94 XI. ADJOURNMENT There was nothing further to discuss at this meeting of the Englewood Housing Authority Board of Commissioners. MOTION VICE CHAIRMAN NORDEN MOVED TO ADJOURN THE REGULAR MEETING OF THE ENGLEWOOD HOUSING AUTHORITY BOARD OF COMMISSIONERS HELD JUNE 29, 1994. COMMISSIONER INNES SECONDED THE MOTION. The meeting adjourned at 8:00 pm. 9