HomeMy WebLinkAboutR-91-0587J-91-7'32
7/25/91
RESOLUTION NO.
A RESOLUTION ALLOCATING FUNDS IN THE AMOUNT
OF $176,000 FROM INVESTMENT INTEREST EARNED
ON THE CLAUGHTON ISLAND FUNDS TO TACOLCY
ECONOMIC DEVELOPMENT CORPORATION, TO PROVIDE
PARTIAL FUNDING FOR THE DEVELOPMENT OF THE
EDISON TERRACE RESIDENTIAL PROJECT, SUBJECT
TO THE CONDITION THAT A PORTION OF SAID
$176,000 WILL IMMEDIATELY BE RETURNED TO THE
CITY IN AN AMOUNT SUFFICIENT TO PAY ALL
EXISTING LIENS OWED TO THE CITY; FURTHER
DIRECTING THE CITY MANAGER TO IDENTIFY AND
ALLOCATE A LIKE AMOUNT FOR THE NORTHEAST
ASSOCIATION GROUP IN THE 1991-1992 FISCAL
YEAR BUDGET.
WHEREAS, funds are available in the amount of $176,000 from
interest earnings in connection with certain obligations of the
Claughton Island Developers for the development of low, moderate
and affordable housing in the City of Miami; and
WHEREAS, the City Commission wishes to participate along
with Tacolcy Economic Development Corporation in the Edison
Terrace Project which is an affordable housing development, by
partly funding the Project; and
WHEREAS, funds in the amount of at least $176,000 are
likewise needed by the Northeast Association for implementation '
of certain improvements to said area and are to be identified and
made available during the next fiscal year;
NOW, THEREFORE, BE IT RESOLVED BY THE COMMISSION OF THE CITY
OF MIAMI, FLORIDA:
Section 1. The recitals and findings contained in the
Preamble to this Resolution are hereby adopted by reference
thereto and incorporated herein as if fully set forth in this
Section.
Section 2. Funds in the amount of $176,000 in interest
to partly defray the costs arising from all existing City liens
on certain parcels placed on the proposed development site of the
Edison Terrace Project and to partly defray the cost of replat of
the subdivision site, and the relocation of tenants whom the
project will displace.
Section 3. The City Manager is also hereby directed to
identify and allocate funds in the amount of $176,000 to the
Northeast Association in the 1991-1992 Fiscal Year Budget.
Section 4. This Resolution shall become effective
immediately upon its adoption.
PASSED AND ADOPTED this 25th day of July ,
1991.
XAVIER L. UAREZ, AYOR
City Clerk
PREPARED AND APPROVED BY:
JULIE O. BRUT /
Assistant City Attorney
APPROVED AS TO FORM AND
CORRECTNESS AS OF AUGUST 30, 1991:
JOB/pb/mv/M2451
CITY OF MIAMI, FLORIDA21
INTEROFFICE MEMORANDUM-
• vVV //
TO : Cesar H. Odio DATE : July 16, i99`i i ~ FILE .
it Manager
SUBJECT : Agenda Item for
City Commission
Meeting 7/25/91
FROM . ( Victor H. De
Commissioner
REFERENCES.
` ENCLOSURES.
Please schedule for July 25, 1991 City Commission Meeting a personal
appearance by Mr. Dewey Knight Jr. and Mr. Otis Pitts Jr.,
representatives of Tacolcy Economic Development Corporation, to
discuss securing the investment interest earned on the "Claughton
Island funds" to partially fund the development -of Edison Terrace.
Thank you.
cc: Honorable Mayor and Members of the Commission
Jorge Fernandez, City Attorney
Aurelio Perez-Lugones, Legislative Administrator
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TACOLCY ECONOMIC DEVELOPMENT
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CORPORA TION
t
EE July 11, 1991
JAL 15 1991
305 757-3737 -,
Commissioner victor DeYurre_ L7
CITY OF MIAMI--....,�r
Otis Pik s, Jr.
Nefdenf P3500 Pan American Drive
Oilicots Miami, F1 33133
Dr, James 0. Plinton, Jr.
'3 CheumenpfTh*8080 near Commissioner DeYurre:
JD Mack
t',•Sf Vice CheirperSon
M. A thalie Range Tacolcy Economic Development Corporation (TEDC) is `
'a. Secon0vice CheoverSor requesting your assistance in securing the investment
Howard Rollins interest earned on the "Claughton Island funds" to
1 Secretary
MajorLeroyA Smith partially fund the development Edison Terraces, a 60-
*r.asure' unit affordable housing development to be located in
JoannJ. Perry Liberty City adjacent to the other housing developments
Directors
of TEDCF The funds continue to be held in an escrow
Marie F. Brown account by the Dade Community Foundation, which
Raymond Mandrel/ estimates them to total approximately $170, 000.
} William Wynn, Jr.
These funds will be used to partially defray costs
arising from liens on certain parcels of the proposed
site, replat of the subdivision of the site, and
relocation of the tenants that the project will
displace. The amounts and descriptions of these costs
are as follows:
Liens .
+ The City placed liens against certain.parcels of the
site for costs it incurred for trash removal and the
demolition of abandoned and dilapidated structures.
The estimated amount of these liens is $45,000. We are
-required to pay these liens by July 15, 1991 by the
Department of Public Works for it to continue to
process our replat application.
i
subdivision Replat t
An unplatted five-foot strip of land running the length ,
of the site was discovered when an updated survey was
prepared for the site. Because the strip is needed for:
some of the proposed construction, City Ordinance
requires the subdivision to be replatted and the strip
to be incorporated into the new subdivision plat.
The Department of Public Works is requiring the
construction of certain improvements -as a condition for the approval of the replat of the subdivision. Among
other requirements related to the improvements, is the
issuance of either a performance bond, letter of credit
• F
645 N. W. 62nd STREET, SUITE 300, MIAMI, FLORIDA 33150 s
t
or cashier's check in the amount of $96,000 to the City
guaranteeing their construction. pursuant to this
requirement, an irrevocable letter of credit in the
amount of $96,000 has been issued by Capital Bank to
the City. TEDC pledged a certificate of deposit as
collateral for its issuance of the letter of credit.
Relocation Expenses
When TEDC acquired the site there were six (6)
remaining tenants. These tenants will be displaced by
the project, and therefore, must be relocated. The
estimated expense of relocating these tenants is
$63,000. The amount is based upon discussions with
Samuel Battle, the Relocation Specialist, Office of
Community Planning and Development, U.S. Department of
Housing and Urban Development.
TEDC acquired the site of the project for approximately
$500,000. Further, it has secured financing commitment —
of approximately $4.3 million from the Documentary
Surtax Program, Homes for South Florida and the
National Equity Fund (NEF). NEF will provide the
equity needed by purchasing the Low Income Housing Tax
Credits which the project has been awarded by the
State. The project has also been awarded an affordable
housing subsidy by the Federal Home Loan Bank of
Atlanta. The subsidy will make 20% of the units
affordable to families earning 50% of the median
income. Fifty of the sixty units of the project will
be affordable to families earning 60% of the median
income. However, the costs for which we are seeking to
use the Claughton Island funds were not anticipated,
and therefore not budgeted in the original applications
for the financing of the project.
The more than $500,000 paid to acquire the site was far
in excess of the original estimate. The underestimate
was due primarily to representations by the previous
owner about matters such as outstanding taxes, liens
and mortgages, the re -filing of an expired mechanics
lien of $30,000, and the delay in recording some of the
encumbrances by both the City and the County.
Additionally, the requirement of the construction of
certain improvements for approval of the replat was
also not anticipated and therefore, not included in the
development budget.
TEDC has had to encumber and expend funds -it will
require for other purposes to move this project ahead.
It has done so to remove the negative impact the site
was having on the area due to its deteriorated
condition and the drug related activity carried on
there. Some of the drug users that frequented the
property began stealing and breaking into the cars of
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the residents in the adjacent housing developments of
TEDC. Further, the continuing uncertainty of the
availability of funding -for affordable housing does not
afford developers of such housing the luxury of waiting
until all of the funding is in place before moving
ahead.
We are therefore, requesting you to aid us in an effort
in which you have demonstrated an interest in bringing
to past. We believe our request for support of this
project is reasonable in light of the following:
The City, as a result of TEDC finding alternative
sources for financing the acquisition and
development of the site was able to utilize the
$375,000 it had earmarked for the proposed site to
fund additional affordable housing needs in the
Overtown area;
The project will achieve the goal of the City to
Cause the development of affordable housing on the
site;
One hundred (100) temporary jobs are estimated to
be created during construction, and five (5)
permanent jobs upon completion to maintain and
manage the project;
Revitalization goals of the City for the Liberty
City area will be furthered by the proposed
development and;
Additional local taxes estimated to result from
the proposed project are $80,000 per annum.
Moreover, had the City acquired the property it would
have absorbed the cost of its liens, the taxes and the
other costs related to acquisition, as well as the
relocation expenses.
Please excuse the length of this letter; however, I
wanted to adequately set forth the reasons for our
request, and the importance of it to the proposed
project.
Should you have any questions, please do not hesitate
to contact me.
Respec fully,
Otis'Pi,ts, Jr.
President
91-
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