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2013-01-22 HRA Agenda PacketAGENDA MOUND HOUSING & REDEVELOPMENT AUTHORITY REGULAR MEETING TUESDAY, JANUARY 22, 2013 6:50 P.M. MOUND CITY COUNCIL CHAMBERS Page 1. Open meeting 2. Action approving agenda, with any amendments 3. Action approving January 8, 2013 regular meeting minutes 4. Action approving claims 2-5 5. Catherine Pausche, Finance Director/Clerk/Treasurer, presenting the 6-15 proposed Recovery Plan to be submitted to HUD 6. Adjourn MOUND HOUSING AND REDEVELOPMENT AUTHORITT JANUARY 8, 2013 The Mound Housing and Redevelopment Authority in and for the City of Mound, Minnesota, met in regular session on Tuesday, January 8, 2013, at 6:55 p.m. in the council chambers of city hall. Members present: Chair Mark Hanus; Commissioners Kelli Gillispie, Ray Salazar, Heidi Gesch Members absent: Vacant Commissioner Seat (David Osmek) Others present: Community Development Director Sarah Smith, Finance Director/Clerk/Treasurer Catherine Pausche, Ken Perbix, Debbie Salazar, Christel Salazar 1. Open meeting Chair Mark Hanus called the meeting to order at 6:55 p.m. 2. Approve agenda MOTION by Salazar, seconded by Gesch to approve the agenda. All voted in favor. Motion carried. 3 Approve minutes MOTION by Salazar, seconded by Gesch to approve the minutes of the December 11, 2012 regular meeting. All voted in favor. Motion carried. 4. Approveclaims MOTION by Salazar, seconded by Gesch to approve the claims in the amount of $24,230.72. All voted in favor. Motion carried. 5. Appointment of Acting Chairperson MOTON by Hanus, seconded by Salazar to adopt the following resolution. All voted in favor. Motion carried. RESOLUTION NO. 13-OIH: RESOLUTION APPOINTING HEIDI GESCH AS ACTING 'CHAIRPERSON FOR THE HRA FOR 2013 6. Statutory Tort Limits MOTION by Salazar, seconded by Gesch to adopt the following resolution. All voted in favor. Motion carried. RESOLUTION NO. 13-02H: RESOLUTION MAKING A SELECTION NOT TO WAIVE THE STATUTORY TORT LIMITS FOR LIABILITY INSURANCE PURPOSES 7. Agjoum MOTION by Salazar, seconded by Gesch to adjourn at 6:57 p.m. All voted in favor. Motion carried.,", Attest: Catherine Pausche, Clerk 0 Chair Mark Hanus aCON lK I'll I • YEAR BATCH NAME IN S:\FINANCE DEPT\AP\HRA MTG CLAIMS LISTING.xlsx $3y272.841 MY OF MOUND Batch Name 2012HRA-AP2 Payments Current Period: Closing 2012 User Dollar Amt $727.34 Computer Dollar Amt $727.34 $0.00 In Balance 01/17/13 8:48 AM Page 1 Refer 2 CSCE S SIGNS Operating Supplies IKM HALLWAY DIRECTIONAL SIGNS $232.99 AP Payment E 680-49800-210 Invoice 5722 1/3/2013 1/16/13 Due 12/31/2012 20 Accounts Payable 20200 Total $232.99 Transaction Date _ Refer hmro _ 3 MULTIHOUSING CREDIT CONTRO E 680-49800-475 Tenant Related Services IKM TENANT TIICEMBER $220.00 AP Payment 201VE BACKGROUND CHECKS invoice 12120344 12/31/2012 1/1612013 Due 12/31/2012 Total Accounts Payable 20200µ $220.00 Transaction Date Refer �..-4. SUN PATRIOT NEWSPAPER -CITY UNIT VACANCY ADVERTISING IKM 12-29-12 $261.96 AP Payment E 680-49800-340 Advertising Invoice 1139444 12/29/2012 1/16/2013 Due 1 2/3112 01 2 Accounts Payable 20200 Total $261.96 Transaction Date Refer 1 TRUE VALUE MOUND (IKM) _ E 680-49800-220 Repair/Maint Supply NYLONADDUSTABLE LOOR $12.39 AP Payment SCREWS, NUTSFBOLTSGUIDE-IKM invoice 100862 12/21/2012 1/15/2013 Due 12/31/2012 Accounts Payable 20200 Total $12.39 Transaction Date Fund Summary 680 HRA PUBLIC HOUSING Pre -Written Check Checks to be Generated by the Computer Total 20200 Accounts Payable $727.34 $727.34 $0.00 $727.34 $727.34 In MOUND, MN 01/16/13 1:44 PM Page 1 Payments i \ ITT F R40UND Current Period: January 2013 r,'„ , t Batch Name 0122COMBOND User Dollar Amt $1,595.89 Payments Computer Dollar Amt $1,595.89 $0.00 in Balance Refer 1 COMMON BOND COMMUNITIES _ Cash Payment E 680-49800-101 F T Empl Regular PAYROLL REIMS 1-11-13 OFFICE SALARY $980.30 Invoice 083321 1/11/2013 Cash Payment E 680-49800-111 Other IKM Maint PAYROLL REIMB 01-11-13 MAINTENANCE $297.00 SALARY Invoice 083322 1/11/2013 Cash Payment E 680-49800-122 FICA PAYROLL REIMS 1-11-13 OFFICE ER TAX $102.81 Invoice 083323 1/11/2013 Cash Payment E 680-49800-130 Employer Paid Ins (GEN PAYROLL REIMB 1 -11-13 MAINTENANCE ER $31.54 TAX &INSURANCE Invoice 083324 1/11/2013 Cash Payment E 680-49800-131 Employer Paid Health PAYROLL REIMB 1-11-13 OFFICE ER $105.21 INSURANCE Invoice 083325 1/11/2013 Cash Payment E 680-49800-121 PERA PAYROLL REIMB 1-11-13 OFFICE ER 401K $34.61 MATCH Invoice 083327 1/11/2013 Cash Payment E 680-49800-321 Telephone & Cells OFFICE STAFF CELL ALLOWANCE 1/11/13 $25.23 Invoice 083326 1/11/2013 Cash Payment E 680-49800-430 Miscellaneous AMERPRIDE MT/CT UNIFORMS 12/12 #6590 $19.19 Invoice 083248 1/11/2013 Transaction Date 1/16/2013 Wells Fargo HRA 10120 Total $1,595.89 Fund Summary 10120 Wells Fargo NRA 680 HRA PUBLIC HOUSING $1,595.89 $1,595.89 Pre -Written Check $0.00 Checks to be Generated by the Computer $1,595.89 Total $1,595.89 in CITY OF MOUND Batch Name 012213HRA Payments Current Period: January 2013 User Dollar Amt $949.61 Computer Dollar Amt $949.61 $0.00 In Balance 01/17/13 9:11 AN Page Refer 1ALPHA RUG AND CARPET CLEANI-CARPET CLEANING |KMUNIT #300 $69.47 Cash Payment E 680-49800-402 Building Maintenanc EFFICIENCY 1-10-13 invoice 2824 1M012013 �� UaFo�oHRA 10120 Total o694/ Transaction Date 1/161201318 Refer ^ ''`E~''—F PAINTING - PAINT WALLS & CEILINGS UNIT #3OV $273.00 Cash Payment ^`— --- 02 Building Maintenance STUDIO 1/3/13 invoice 244 1111C2013 EOVV�88nO402BuiNingM��enonoo ;����&�\UN���#�1B� $376.00 Cash 1/4/13 invoice 244 1/11/2013 Fargo HRA 1(�2O Total $84960 Trannm��n�a� 1116/2013VvvU Rn�' ^ CILITIES MAINTEN- *5418 Cash Payment — ="""~~.~^~'—'---- Supply ' yyH��1^AL��|NU��|N|8UND.STEELBY' pAGG\NGSLOTHANGERTRACKKIT. WARDROBE DOOR GUIDE HARDWARE |0N #1O9 invoice 9119751079 1/4/2013 10120 Tn�| � $541O Transaction Date 1/16/2013YVa�F��oHRA &498nO4r5T�nm�Re|�e�8erM�s JANUARY 2u`oCALL ^E.".="=.~E..,., $43.00 ~~~^''~'''-- — |KM Invoice 0290378 111/2018 ��UsFa�oH�A 1O12O Total $43.00 Tra aacUonD�e 1116/2013 Refer 19 L"''L^'`COMPANIES, - '�—�' in- |K0COPIER OVERAGE CHARGES BALCK& *52�47 Cash Payment ~~^--- —~~`~— =""" WHITE 1U-20-12THRU1-18'18 Invoice 1509033 1/8/2013 VVeU Fargo HRA 10120 Total $52.47 Transaction Date 1�7�O 3 Refer 5 WILMAR Repair/Maint Supply CHROME DRIP PANS-IKM $80-91 Cash Payment E 680-49800-220 Invoice 279892137 1/3/2013 Wells Fargo HRA 10 1 2 0 Total $80.91 Transaction Date 1/16/2013 r Fund SummarY O8VHRA PUBLIC HOUSING Pre -Written Check Checks toboGenerated by the Computer Total HUD requested a proposed recover plan be submitted within 30 days of their January 2, 2013 letter. An earlier letter designating the Mound HRA as troubled offered the following suggestions on how to improve the occupancy rate. The Mound HRA responses are included below The January 2, 2013 letter made suggestions in the following four areas: Financial —Accounts receivable and payable as of 12/31/11 had a negative impact and those issues have been resolved. HUD suggests that we consider obtaining approval to sell non- performing Public Housing property or contracting for property management. The Mound HRA will evaluate its option to sell the public housing when HUD approves the sale of Columbia Heights public housing to AEON. The process is not fully developed at this point. Mound has contracted with Common Bond Communities as of May of 2011 to manage its public housing and is working through transition issues. The property breaks even and cost reduction strategies have been a focal point since 2009. 01 HUD Recommendation Management Response Status 1 Evaluate wait list, selection and certification ACOP updated in May 2012. Need to process, update ACOP increase numbers on wait list by advertising locally, outreach. CB to provide wait list monthly. 2 Assess marketing efforts including free Refer to Common Bond Marketing Plan, websites verify follow-through 3 Intake policies efficient? Believed to be adequate 4 Limit transfers if vacant units more Transfers are optional but a $400 fee is marketable... problem with moves to other charged which discourages demand. housing sites IKM units are smaller than other options in the area. 5 Minimize turn -around time on vacant units, CB to provide mgmt report of punch list ensure PIC is updated on a timely basis. and timeline to get it done. Mgmt monitors PIC. 6 Assess marketability of units and location Great location but smaller units that have not been completely updated.... need new woodwork and cabinetry. Studios are unpopular. 7 Any units taken off line currently? No 8 Tenant Accounts Receivable Issues at year-end have been resolved. 9 1 Accounts Payable I Issues at year-end have been resolved. The January 2, 2013 letter made suggestions in the following four areas: Financial —Accounts receivable and payable as of 12/31/11 had a negative impact and those issues have been resolved. HUD suggests that we consider obtaining approval to sell non- performing Public Housing property or contracting for property management. The Mound HRA will evaluate its option to sell the public housing when HUD approves the sale of Columbia Heights public housing to AEON. The process is not fully developed at this point. Mound has contracted with Common Bond Communities as of May of 2011 to manage its public housing and is working through transition issues. The property breaks even and cost reduction strategies have been a focal point since 2009. 01 Management — Occupancy rates continue to be the major challenge and therefore the focal point of our proposed recovery plan. The emphasis needs to be on reducing turnover and improving the marketability of our units. More will be done to grow the wait list by increasing marketing and outreach efforts. There has been an increase in senior housing developments, all of which have an affordable component, so we have lost many of our senior tenants who were able to upgrade to new, larger units with no change in rent. At the December 11, 2012, HRA Board Meeting, representatives of Common Bond presented their action plan to improve occupancy rates. The marketing/outreach plan includes: • Advertising in local newspapers ® Keeping Common Bond Website updated with availability ® Use of other websites (non -profits) that promote affordable housing ® Make contact with churches and social service agencies to let them know of availability ® Contracting with Level 1 to provide 24/7 phone service coverage that will schedule showings on behalf of management, increasing customer service and reducing wait times ® Add a sandwich sign to indicate when management is in office, to complement the "Blow Leasing" banner that hangs prominently on the building • Increase reporting to HRA Board on traffic, applications approved and denied. The plan to reduce turnover includes: 0 Live-in caretaker position filled as of 2-1-13. Position critical to keeping the peace and serves as a conduit between tenants and management. 0 Offer social worker services once rental revenues increase and can fund it Respond quickly to complaints and enforce lease violation rules to weed out problem tenants ® Hold periodic tenant meetings to give updates on capital improvements and management issues and allow for questions from tenants and face time with staff from the housing authority, in addition to Common Bond management. The first report on occupancy is included with this recovery plan. Management has put on hold any discussion of combining studio units into 2 bedrooms per HUD's request. The Finance Director will submit the 2012 data for the PHAS score by the end of February and request HUD to update the score. We know the occupancy score for 2012 will continue to be poor, but the Financial score should increase moving us from "troubled" back to "standard" performer. Every effort will be made to raise and maintain the occupancy rate to a target of 94% or better at all times. -7- 2013 -Jan -16 08:34 AM CITY OF MOUND 199524725699 * occupancy, see attached vacancy report wait list as of 12/81/12 o Studio ® 0 on wait list ® offering immediate openings o one bedrooms Through list -23 total on list, ail offered units available and declined offering immediate openings o Two Bedroom a 9 Total Households Applicant History as of 1.2/31/12 o Showings In month of December 12/7/12 one bedroom unit to applicant who cannot move in until 4/1/13; applicant added to wait list 12/17/12 one bedroom unit to applicant who began move in verification process 12/17/12 one bedroom unit to applicant who began move in verification process 12/17/12 studio unit to applicant who was later denied for criminal background 12/19/22 one bedroom unit to applicant who began move in verification process 12/19/12 studio unit to applicant who declined to be added to the waiting list, Indicated Mound was too far from the Cities for him ® 12/19/1.2 studio unit to applicant who was later denied for UDs on record id 12/21/12 studio unit to applicant who began move In verification process a 12/21/12 studio unit to applicant who was later denied for criminal background x 12/21/12 studio unit to applicant who declined unit indicating it was too small 12/27/12 studio unit to applicant who began move in verification process a 12/28/12 studio unit to applicant who began move In verification process In 2/6 2013 -Jan -16 08:34 AM CITY OF MOUND 199524725699 3/6 rr nt Va e SJUXALWI-011 o Studios units 6 applicants all Indicating studios or one bedrooms 1 ti I bedrooms 26 applicants "7 �L c�t 1111, 64 2 bedroom 13 applicants at Pres= ® occupancy: please see attached vacancy report lection s of 2 * occupancy: please see attached vacancy report LSI-'Lto 1-t CA &a 2013 -Jan -16 08'34 AM CITY OF MOUND 199524725699 Indian Kna11 PIROP$RTY VWITa : Zll;b Decambcr 31114 2012 (MONTHIDAYIYEAR) VACANCY CODES I -DEATH 36-NURSINO ROME 3 -OTHER SUBSIDIZED ROUSING 4 -NON -SUBSIDIZED HOUSING 8 -UNIT TRANSFER 6 -RELOCATION yw$VICrION s -OTHER P -PURCHASED HOME 0 DUE EVERT' MONDAY Please Email To Regional Manager m 4/6 w 16 z d 300 a 10/31 11/30/2012 11/30/.2012 1 U30/2012 atlon APPROVED I -Feb 60 at MI 404 1 7/31 7 -Se 7 -Se 7 -Se Ication in rocess i 14 106 s 12112 12 -Dec 12/ 12 -Dec lcationIn rocess 365 20S 1 6/30 31-JUI t8 -Jul IWut atlon APPROVED 16 -Jan 164 2Ip 2 7131 31 -Au 31 -AP Apo 14callon in mccss 1.1?cb 150 212 $ 12127 3I-Dcc 31 -Doc 31 -Dec ication in mcess 365 4D 9g 9130 31 -Oct 3I.00t 31 -Oct ication in process 60 207 1 6/30 3I -Jul 3I -7u1 31 -Jul ication in process ISO ALL T ON NOTICE VACANCY CODES I -DEATH 36-NURSINO ROME 3 -OTHER SUBSIDIZED ROUSING 4 -NON -SUBSIDIZED HOUSING 8 -UNIT TRANSFER 6 -RELOCATION yw$VICrION s -OTHER P -PURCHASED HOME 0 DUE EVERT' MONDAY Please Email To Regional Manager m 4/6 P.�MENro w 0 ,ge �G IIIA oe �N ncVF�' Board of Commissioners c/o The Honorable Mark Hanus, Board Chair HRA of the City of Mound 5341 Maywood Rd. Mound, MN 55364 Dear Commissioners: U.S. Department of Housing and Urban Development Minneapolis Field Office 920 Second Avenue South Minneapolis, Minnesota 55402 http://www.hud.gov/ JAN - 2 9013 On December 12, 2012, the Mound HRA was designated Troubled by HUD based on a failing Public Housing Assessment System Audited /Non A-133 financial score of 9 (out of 25), a management score of 1 (out of 25), and an overall score of 57 (out of 100) for the fiscal year ending 12/31/11, as shown in the enclosed PHAS Score Report. Based on your troubled status: 0 All existing open Capital Fund grants open will be placed on "auto review" in HUD's Line of Credit Control Systems (LOCCS). This means that you will not be able to draw down funds unless HUD has reviewed your plan and backup documentation. Requests without sufficient justification will be rejected. 0 All future Capital Funds will also be subject to auto review until further notice from HUD. 0 All plans for modernization/unit conversions should be suspended until HUD completes a more comprehensive assessment of your financial status. Our next letter will include a records request to complete the assessment. As a reminder, HUD's communic, Executive Director and/or Board Chair, as designated in the Public Housing Information Center (PIC) database. All letters related to your Troubled status will be sent to the Board Chair, with courtesy copies to the Appointing Official, Board Members, and Executive Director. If the HRA Board Chair wants to a oint another Commissioner to be the liaison to HUD for this matter, please provide official notification of this change. If the change will be permanent, update the HRA's bylaws and PIC. The Board of Commissioners of the HRA of the City of Mound should take immediate action to identify the sources(s) of the performance deficiencies and develop and implement a plan to recover its PHAS score and ensure long-term sustainability at an acceptable level of performance. The following list of actions is offered as common suggestions to the Board to use in self - SH diagnosing the source(s) of its deficiencies and identifying solutions to recover its performance for long-term sustainability. Financial Typically, when a public housing agency becomes financially substandard, it must either: (1) increase revenue; (2) decrease expenses; or (3) implement a combination of both. Revenue ® Evaluate tenant screening, lease enforcement, and rent collection policies and actions to increase tenant rental revenue. • Consider establishing or raising minimum rents. Consider obtaining approval from HUD to sell non-performing Public Housing property or non-residential property covered under a HUD Declaration of Trust. • Consider selling unencumbered property. ® Consider obtaining supplemental funding from State or local government agencies to cover budget deficits and cost overruns of its Public Housing or non-federal programs. ® Consider reducing the scope of non-federal programs to operate within their financial means. Determine whether all portability revenue is being collected from the issuing public housing agencies in the Housing Choice Voucher program. Expenses ® Consider reducing salaries and employee benefits to levels that stay within budget parameters. • Consider reducing management and line staffing levels. • Evaluate utility consumption, energy policies, and consider implementation of energy conservation measures and agreements to reduce energy costs. • Evaluate all existing contracts for cost and necessity. • Evaluate and re -price insurance costs. • Evaluate the need and usage of fleet vehicles. ® Consider contracting property management or maintenance of Public Housing to another entity or public housing agency. Management Generally, when a public housing agency becomes management substandard, it has failed to maintain an acceptable occupancy level in its developments. • Evaluate waiting list, tenant selection, and initial certification processes to ensure coordination with property managers and timely preparation for move -ins. • Assess existing new tenant intake policies and practices and consider implementing those that would contribute to quicker lease up, such as starting the certification process earlier or limiting the number of unit -offer turn -downs for new tenants. ® Assess existing continued occupancy policies and practices and consider implementing those that would reduce the frequency of move -outs, such as educating tenants on lease enforcement and how to be good renters or limiting transfers for existing tenants. ® Evaluate the turn -around time of vacant units for occupancy, including the time it takes maintenance to make-ready units and the time it takes property managers to lease up units. • Assess the feasibility and desirability of under -occupied developments, e.g. physical condition and configuration, rehabilitation costs and lifespan, neighborhood factors such as crime and proximity to employment, transportation, and services, etc., and consider repositioning options if appropriate. ® Ensure that units taken off line for modernization, special use, or other allowed reasons have been approved by HUD, do not exceed their permissible time limitation (e.g. three years maximum for modernization units), and are correctly classified in HUD systems. • Consider contracting property management of Public Housing to another entity or public housing agency. Please provide our office with a�� ®posse recovery playa within 34 days of the rece of this letter. Your plan will be reviewed by a Recovery Team of subject matter experts to determine further assistance to be provided by HUD and actions to be taken. Please also be advised that HUD is initiating actions to develop and execute a binding Recovery Agreement and Action Plan with the HRA of the City of Mound as required by federal statute, to document and ensure that recovery efforts have been put in place. If you have any questions or need assistance in developing your plan, please contact me at Lucia.M.Clausen@hud.gov, or 612-370-3000, ext. 2221. .ncerely, t ucia M. Clausen, Director office of Public Housing Enclosure cc: Ms. Heidi Gesch, Board Member HRA of Mound 2459 Chateau Ln Mound, MN 55364 Ms. Kelli Gillispie, Board Member HRA of Mound 5361 Baywood Shores Drive Mound, MN 55364 Mr. Ray Salazar, Commissioner HRA of Mound 4558 Island View Dr. Mound, MN 55364 Mr.Vavid Osviek, Commissioner HRA'6f. the ity of Mound Mound ' Hall 5341 od Rd. Mo , MN 364 Ms. Kandis Hanson, Executive Director HRA of the City of Mound Mound City Hall 5341 Maywood Rd. Mound, MN 55364 Sn {(¢, U. S. Department of Housing and. Urban Development *('f OFFICE OF PUBLIC AND INDIAN HOUSING REAL ESTATE ASSESSMENT CENTER Report Date: 9/24/2012 !PHA Code: MN074 PHA Name: HRA OF THE CITY OF MOUND, MINNESOTA ,Fiscal Year End. 12/31/2011 PHAS Indicators Score Maximum I -1.01 Score Physical 37 40 Financial 9 25 Management 1 25 Capital Fund 10 10 rae Penalty Points 0 AS Total Score 57 100 PHAS Designation Troubled.. Initial PHAS score issued date: 4/30/2012 Financial Score Details Maximum Score A S Score before deductions 10.06 25.00 2. Audit Penalities -1.01 (Total Financial Score Unrounded (FASS Score - Audit Penalties) 9.05 25.00 I Capital Fund Score Details Score Maximum Score Timeliness of Fund Obligation: 1. Timeliness of Fund Obligation % 90 2. Timeliness of Fund Obligation Points 5 5 Occupancy Rate: I 3. Occupancy Rate 92 4. Occupancy Rate Points 5 5 Total Capital Fund Score (Fund Obligation + Occupancy Rate): 10 10 Notes: 1. The scores in this Report are the official PHAS scores of record for your PHA. PHAS scores in other systems are not to be relied upon and are not being used by the Department. 2. Due to rounding, the sum of the PHAS indicator scores may not equal the overall PHAS score. 3. "0" FASS Score indicates a late presumptive failure. See §§ 902.60 and 902.92 of the Interim PHAS rule. 4. "0" Total Capital Fund Score is due to score of "0" for Timeliness of Fund Obligation. See the Capital Fund Scoring Notice. 5. PHAS Interim Rule website - http://www.hud.gov/offices/reac/products/prodphasintrule.cfm M