City of Highland Park Housing Commission met Jan. 5.
Here are the minutes provided by the commission:
CALL TO ORDER
At 6:32 p.m., Chairman Berkun called a meeting via remote access of the Highland Park Housing Commission, Peers Housing Association, Ravinia Housing Association, Walnut Housing Association, and the Sunset Woods Association to order. Each of the Commissioners also serves as Directors of each of the Housing Associations. Staff was asked to call the roll.
ROLL CALL
Commissioners Present: Chairman Berkun, Commissioners Bernstein, Dennison, Fernandez Sykes, Gonzalez, Paushter, & Valbrun
Councilmember Present: Blumberg
Student Reps Absent: Fishman, Keysers
Staff declared that a quorum was present.
Staff Present: Later, Coleman
Guests Present: Harold Eich/ERES
Rob Anthony/CPAH
Kevin Beard & Elizabeth Flatley/EREG
APPROVAL OF MINUTES
Regular Meeting of the Housing Commission – December 1, 2021
Commissioner Bernstein moved to approve the December 1, 2021 regular meeting minutes. Commissioner Dennison seconded the motion.
On a roll call vote:
Voting Yea: Commissioners Bernstein, Dennison, Gonzalez, & Valbrun
Voting Nay: None
Abstain: Chairman Berkun & Commissioner Paushter
Chairman Berkun declared that the motion passed unanimously.
Commissioner Fernandez Sykes arrived at 6:33 p.m.
BUSINESS FROM THE PUBLIC
Deputy Director Later advised no emails were received, and there is no one in the audience.
SCHEDULED BUSINESS
1. Items for Omnibus Vote Consideration
• Payment of Invoices
• Ratification of Payments
Deputy Director Later advised there is nothing outstanding.
2. Peers, Walnut, Ravinia, Sunset Woods Associations, & Housing Trust Fund
• Consideration of ERES Management Reports and Financials
Deputy Director Later noted Harold Eich is present from ERES if anyone has questions. Peers
Commissioner Dennison:
∙ identified boiler issues and asked Mr. Eich if it makes sense to purchase a high-efficiency boiler. Mr. Eich shared that one boiler failed, and the other may be overworked. He noted Staff would receive a quote this week.
∙ asked if there would be a savings. Mr. Eich said he is not sure how much.
Commissioner Paushter referenced Page 12, Operating Expenses, and said the amount in the Miscellaneous category is a much higher amount than usual. Mr. Eich noted this is predominantly Rainbow Restoration charges (from February-March, 2021, leaks to various units); will be reimbursed by insurance.
Chairman Berkun asked:
∙ if boilers are approved by the HC or ERES. Mr. Eich responded this is typically decided by the management company. If the HC requests to be involved, that can be done.
∙ about levels of efficiency. Mr. Eich said this is an immediate replacement need. Deputy Director Later added, in the past, ERES selected the vendor, and the HC approved it. She reminded the next meeting is February 2, 2022, and agreed this is typically decided by the management company. HC comments can be directed to her. A special meeting could be arranged if necessary.
Mr. Eich clarified that the hot water heater needs replacement not a boiler. Routine repairs are being done presently.
Chairman Berkun stated ERES should take care of this.
Ravinia
Commissioner Paushter asked if the HC could receive a copy of the Management Occupancy Review. Mr. Eich will provide same.
Commissioner Dennison asked:
∙ about snow removal costs. Mr. Eich advised the first installment of the service goes through winter.
∙ regarding the Management Occupancy Review, if there is a rating above satisfactory. Mr. Eich stated the ratings are below average, unsatisfactory, satisfactory, above average, and superior. He explained this has been a discussion with the auditing agency. Ratings begin at 70 out of 100. Mr. Eich said some evaluations are subjective depending on the inspector. He noted Ravinia will be inspected again in two years. Peers will be reviewed in 2022.
Mr. Eich reported that Covid concerns will be added to the management report. Cleanings are still occurring seven days a week at Peers. He shared the community spaces are open, but no activities are being held. ERES is encouraging all staff/employees to be vaccinated and boosted for the benefit of the residents.
Chairman Berkun asked if new Mayoral mandate applies to the communities. Deputy Director Later replied it does not affect residential buildings.
Deputy Director Later asked if the Commission will maintain postponing tours of the properties for new Commissioners until the Spring. The Housing Commissioners all agreed to hold off on all tours until the Spring and warmer weather when windows can be opened, the outdoor patios are set up, and after the current Covid case resurgence subsides.
Mr. Eich said he will introduce the HC to a new Regional Supervisor at the next meeting as he is transitioning to another position within ERES. Chairman Berkun said he appreciates Mr. Eich’s assistance. Mr. Eich appreciates the HC’s support.
• Housing Trust Fund Financials
Deputy Director Later advised nothing is outstanding.
• Sunset Woods Financials
Deputy Director Later advised nothing is outstanding.
• Other Association Business
Deputy Director Later advised nothing is outstanding.
OLD BUSINESS
1. Consideration and Approval of CPAH Operating Request – Q4 Status Report
Mr. Anthony said they have recently purchased four properties:
∙ 1287 Ridgewood Drive (completion of rehab in 1st quarter, 2022)
∙ Two townhomes:
o 1968 Linden (found a buyer this month)
o 1958 Linden (completion in 1st quarter, 2022)
∙ 1246 Ridgewood Drive (completion Spring, 2022)
He noted there are 472 households on the waitlist; 22 inclusionary units have been leased (at Albion & Ravinia). There were two recent turnovers at 833 Laurel.
Mr. Anthony said they are working with two companies to provide quotes for solar options.
Commissioner Bernstein inquired about the McGovern House unit and asked if it has ever been occupied. Deputy Director Later advised two units are vacant. There was interest with one, and the other was being used as a model. She noted the owner has been asked to return the unit being used as a model to an available affordable unit. Chairman Berkun asked who the owner is. Deputy Director Later said a group named Nexsteps. She noted they are in the process of selling to a new owner.
Commissioner Dennison moved to accept CPAH’s request for a Q4 drawdown from their 2021 Operating Grant. Commissioner Bernstein seconded the motion.
On a roll call vote:
Voting Yea: Commissioners Bernstein, Dennison, Fernandez Sykes, Paushter, & Valbrun
Voting Nay: None
Abstain: Chairman Berkun & Commissioner Gonzalez
Chairman Berkun declared that the motion passed 5-0.
2. Consideration and Approval of Peers and Ravinia Refinance Proposal Summary and Recommendation – EREG
Deputy Director Later introduced Kevin Beard and Elizabeth Flatley from EREG.
Ms. Flatley noted they received responses from:
∙ Centennial
∙ PNC
∙ Merchants
∙ First Bank of Highland Park
She explained the proposals.
Chairman Berkun asked why we would prepay a mortgage. Ms. Flatley shared if tax credits are sought, this may be a reason. Ms. Flatley shared her screen and continued her presentation.
Mr. Beard expounded about options to pay debt, rehab costs, etc. He noted before paying down debt, there is a provision allowing qualifying non-profits to be the holder of the debt. He noted the recommendation is the HUD 223(f) loan and working on the applications immediately.
Chairman Berkun discussed why we should move away from Mark-to-Market. Deputy Director Later stated rents are calculated for Ravinia using a rent comparable market study. She explained possibly why the properties were put into the Mark-to-Market program. This is all part of the 5-Year Strategic Plan (financial health of the properties). A refinance at a lower rate offers increased cash flow allowing for capital improvements.
Commissioner Paushter stated, from a process point of view, the HUD 223(f) has a lot of positives. However, the Committee of the Whole wished the HC to obtain a financial advisor. Deputy Director Later said Mr. Beard and Ms. Flatley are the advisors from EREG. She noted they are presenting a summary and recommendation. Deputy Director Later said an RFP was done. She explained Mr. Eich is from Evergreen Real Estates Services (ERES) and Mr. Beard and Ms. Flatley are with Evergreen Real Estate Group (EREG).
Ms. Flatley continued. She noted Fannie and Freddie are not good options due to shorter amortization and the need for refinancing again in 10 years.
Commissioner Dennison asked if there is a minimum pre-payment penalty. Mr. Beard stated he is not sure and will review. He noted there is a greater uncertainty with yield maintenance. Commissioner Dennison explained lows at the Treasury, etc. He said there is not extremely high debt on these properties.
Chairman Berkun asked if there are any needed expendituresto have cash available. Deputy Director Later said capital studies were done. Roofs and tuck pointing repairs will eventually be needed. The two single family homes on Ravinia are over 100 years old, have had flooding issues, etc. Mr. Eich concurred.
Commissioner Dennison expressed he believes they are making a mistake by not providing an analysis of LIHTC funds. Mr. Beard discussed LIHTC funds and provided history of this option with the City. The Committee of the Whole did not see that as the right path. Commissioner Dennison said he recalls the Committee of the Whole misunderstood what was happening and explained same. Deputy Director Later recalls the Committee of the Whole’s direction is to move forward with refinancing now and perhaps review LIHTC at a later date.
Commissioner Dennison and Chairman Berkun said they have/had a relationship with the First Bank of Highland Park.
Deputy Director Later asked if Mr. Beard and Ms. Flatley have a recommended entity. Mr. Beard said the best match is a HUD 223(f) loan with PNC. Deputy Director Later said she had asked CPAH for any recommendations and they suggested PNC as they have worked with them. Ms. Later said once applications are prepared, City Council would approve before the HC enters into any agreement.
Mr. Beard’s recommendation is to approve the HUD 223(f) loan with PNC for Peers & Ravinia then report back to the HC at the next meeting regarding Ravinia.
Commissioner Bernstein moved to direct Staff and EREG to move forward with the HUD 223(f) loan with PNC Bank for both Peers & Ravinia. Commissioner Valbrun seconded the motion.
On a roll call vote:
Voting Yea: Chairman Berkun, Commissioners Bernstein, Fernandez Sykes, Paushter, & Valbrun
Voting Nay: Commissioner Dennison
Abstain: Commissioner Gonzalez
Chairman Berkun declared the motion passed 5-1. Commissioner Dennison & Chairman Berkun thanked Mr. Beard and Ms. Flatley for a very detailed presentation.
3. 5-Yr Strategic Plan – Interview Summary
Deputy Director Later advised this would be moved to a later date.
NEW BUSINESS
Deputy Director Later welcomed Commissioner Gonzalez and asked him to give a brief introduction. Commissioner Gonzalez shared he has been a resident of Highland Park for the last six years and was previously in Mexico. He is a Chemical Engineer, works part-time for the Friends of the Highwood Library, volunteers, etc. Commissioner Gonzalez loves to play tennis and is happy to be part of the HC.
STAFF REPORT
There is no Staff Report.
ADJOURNMENT
Commissioner Dennison moved to adjourn the meeting at 8:21 p.m. Commissioner Paushter seconded the motion.
On a roll call vote
Voting Yea: Chairman Berkun, Commissioners Bernstein, Dennison, Fernandez Sykes, Gonzalez, Paushter, & Valbrun
Voting Nay: None
Chairman Berkun declared that the motion passed unanimously.
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