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HomeMy WebLinkAboutMinutes-08/21/2017COUNCIL WORK SESSION August 21, 2017 4:25 p.m. Harold E. Getty Council Chambers Members present: Morrissey, Powers, Lind, Amos, Schmitt, and Welper. Absent: Jacobs. Moved by Welper seconded by Morrissey that the Agenda, as proposed, be approved. Objective: Discussion of 28E Agreement with Hawkeye Community College to allow residential housing construction on city owned lots. Noel Anderson, Community Planning and Development Director, provided an overview of the 28E agreement with Hawkeye Community College. Hawkeye Community College would acquire lots from the city for $1.00, will not charge for student labor on homes, only costs for materials, provide insurance for homes while under construction including workmen's compensation and general liability, and each home will be completed within three years. The city will acquire homes when completed for sale for costs of materials, city will pay for the cost of construction and taxes on the lot and when ready for development the city will convey lots. Mr. Welper commented on the positive working relationship with Hawkeye. Mr. Powers questioned if the lots will be prioritized for acquisition. Noel Anderson explained that the lots will vary based on location, with the goal or breaking even on construction costs. Mr. Powers questioned if Hawkeye will be responsible for preparing the lots for construction. Noel Anderson explained that the city would demolish the structure and remove trees as necessary but Hawkeye would be responsible for grading. Mr. Morrissey questioned if they are still hoping to have two lots in the same area ready for building. Jane Bradley, 913 Dena Street, explained that Hawkeye has a sustainable two year construction program at the college. The plan would be to have two houses under construction at the same time, so that first year students can start on a house, with second year students completing the project. She explained that having houses in close proximity would be ideal as staff and students could work closer together but it is not a requirement. Ben Strickert, Hawkeye Community College, concurred, and explained that it is not a requirement to have the homes close by one another. Mr. Lind questioned how the project works with the sale of property policy, especially if another individual would like to purchase property. Noel Anderson explained that it is always a possibility that another individual would be interested in the property. Mr. Lind questioned if they would need to pay taxes on the materials. He further commented that he is concerned that the houses may not sell for the same as the cost of materials. Noel Anderson explained that the appraisal would have an impact on the sale price of the home. Mr. Lind questioned why the properties would not be conveyed directly to Hawkeye for the teaching opportunity of building, managing and selling. Jane Bradley explained that they do not have a real estate program at this time so they are looking to have the city sell the property. She further commented that this type of project has been accomplished in other communities and that they would be working within a budget that is agreed upon by the two entities. August 21, 2017 Page 2 Mr. Lind questioned if a realtor would be used to sell the homes. Noel Anderson commented that they would look into using a realtor. Mr. Lind questioned what would happen if the cost to build was more than the anticipated value. Noel Anderson explained that if the city sells the house at a loss they will still get the tax revenue and it would help property values in the neighborhoods. Mr. Lind questioned if the homes qualify for the CLURA/CURA. Noel Anderson confirmed. Mr. Welper commented that the homes have to sell at market value. Mr. Lind questioned if a public hearing will be held when the property is sold. Noel Anderson confirmed. Mr. Schmitt questioned how this project differs from the program at a school in Cedar Rapids. Ben Strickert explained that the shop program at Independence has a similar program and that the homes that would be built will be energy efficient and affordable. Mr. Schmitt questioned if the lots are considered to be less desirable due to size and location. Noel Anderson commented the lots are not necessarily less desirable, rather a good opportunity. Mr. Schmitt questioned to what degree will people be made aware of the ability to purchase the homes. Noel Anderson commented that lists of city lots are provided to home builders that come in for permits and that the city already does have a lot of publicity on 657A lots available for purchase. Mr. Welper commented that the lots being chosen for this project are those that people have not shown a desire in buying. Mr. Lind questioned how this would be funded. Michelle Weidner, Chief Financial Officer, explained that they would start by utilizing nuisance property bond funds and then utilize sale proceeds to fund future building materials along with tax revenue. Mr. Morrissey questioned how long have they been working on this project. Mr. Welper commented they have been working on this for over a year and a half. Mr. Morrissey questioned how many people have been involved with the project and if any issues are anticipated from neighboring properties. Mr. Welper explained about 25 people have worked on the project. Noel Anderson explained that neighbors near a similar project did complain about construction near their homes, and voiced their preference to keep their tax base low. He further commented that following the project, many of the neighboring homes had begun to paint and fix up their homes. August 21, 2017 Page 3 With no further business before the Council, it was moved by Welper seconded by Schmitt that the meeting be adjourned at 4:47 p.m. Voice -vote Ayes: Six. Motion carried. 1 Kelley Felc e City Clerk