Explanation
BACKGROUND
This ordinance authorizes the Director of the Department of Development to enter into a grant agreement with Columbus Metropolitan Housing Authority for development of a 177-unit affordable housing development in an amount up to $4,800,000.00. Columbus Metropolitan Housing Authority will enter into a grant agreement with the city for the bond funds as a pass-through entity to Nelson Park Preservation Associates LLC. Assignment is subject to approval of ownership and control documentation by the City Attorney’s Office.
MHP Nelson Park, Inc. is the administrative member of the managing member (Nelson Park Manager LLC) of Nelson Park Preservation Associates LLC. MHP Nelson Park, Inc. is a wholly owned subsidiary of Metropolitan Housing Partners, Inc. and Metropolitan Housing Partners, Inc. is a wholly owned subsidiary of the Columbus Metropolitan Housing Authority (CMHA) and CMHA will hold title. In addition to being co-owners of the project as members of Nelson Park Preservation Associates LLC - Renewal Housing Associates LLC, The Orlean Company and CMHA - are all co-developers of the project.
Nelson Park Apartments involves the acquisition and rehabilitation of an existing 177-unit affordable housing development in the Eastgate neighborhood on the near east side of the City of Columbus. The property was originally constructed in 1958 and has been identified by the Ohio Historic Preservation Office and the National Park Service (NPS) as a historically significant asset as one of the first housing developments in the United States developed using financial assistance from the Section 221 program and has been listed on the National Historic Register. The property has not received a substantial rehabilitation since 1980 when it was brought into HUD’s Section 8 sub-rehab program. The project currently includes 47 residential buildings with one, two and three-bedroom townhomes serving both families and seniors, 100% of which are covered by a HUD Section 8 Housing Assistance Payment (HAP) contract. Preservation of this asset for the near east side community is critically important as rents and home values continue to escalate while affordability continues to decline. The current owner of Nelson Park Apartments, The Orlean Company, and its development partners, Renewal Housing Associates, and the Columbus Metropolitan Housing Authority, have prepared a comprehensive, multifaceted redevelopment plan not only to ensure the long-term viability and affordability of Nelson Park Apartments, but also to ensure that the housing provided on the site better serves both its residents and the surrounding community.
Historically, due to existing restrictions on the property, Nelson Park has had limited financial resources to address the current issues in a meaningful and lasting way making this redevelopment plan both necessary and urgent. Importantly, the development team has received HUD approval of this redevelopment plan, which requires a complex financial restructuring involving the movement of a Mark-to-Market Use Agreement, an 8bb HAP transfer and a Mark-Up-to-Market application.
Due to its size, building obsolescence and resident mix, Nelson Park has been challenging to manage, operate and maintain effectively. It has been the scene of numerous episodes of violence and crime. Therefore, as part of the redevelopment plan, the overall footprint and population of the property will be reduced from 47 residential buildings to 42 residential buildings and from 177 units to 140 units. Post-rehab, there will be 14 elderly buildings with four (4) 1-BR units in each and 28 family buildings with two (2) 2-BR units and one (1) 3-BR unit in each. Primarily through the adaptive reuse of three buildings on the far west end of the site, the residential site plan will be condensed so that the property will be easier to manage and so that residents will have easy access to the new community building, management office building and maintenance garage, and amenities that will be provided. New lighting and an enhanced security system, along with a reduction in the number of curb cuts and ingress/egress points on the property, will further improve safety and security for both the residents and the surrounding neighborhood.
The property is in a neighborhood poised for redevelopment and that has seen increasing property values because of targeted and strategic redevelopment efforts, including the opening of a new Amazon Distribution Center immediately abutting the property, as well as the Creekside Apartments around the corner on Nelson Road. The property currently serves many extremely low-income households, including families with children and seniors, but as part of the redevelopment plan, the property will also serve homeless and formerly homeless individuals referred by the Community Shelter Board (CSB). Residents will benefit from a service package that seeks to improve health and wellness, educational and workforce outcomes for individuals and families. Residents will also continue to benefit from a Central Ohio Transit Authority (COTA) Bus Stop on the property at the corner of Nelson Road and Maryland Avenue, as well as the 30-acre park (Nelson Park) managed and maintained by the City’s Recreation and Parks Department that provides immediate access to athletic fields, basketball courts, playgrounds, a shelter house, lighted walking trails and the Alum Creek Greenway bike trails. Importantly, all existing residents at the property will remain at the property and during the rehab, temporary relocation will occur on site minimizing disruption of the lives of residents. No permanent relocation or displacement will occur as a result of the redevelopment.
Emergency action is requested in order to maintain the project schedule and to meet deadlines for this project that are set forth by U.S. Department of Housing and Urban Development (HUD). Without emergency action, new affordable housing would be further delayed from a low-income community in urgent need of it.
FISCAL IMPACT: Funding in the amount of $4,800,000.00 is available in 2024 Capital Improvement
Budget, Affordable Housing Bond fund.
CONTRACT COMPLIANCE: the vendor number is 006216 and expires 09/8/2025.
Title
To amend the 2024 Capital Improvement Budget; to authorize the City Auditor to transfer funds within the Affordable Housing Bond Fund; to authorize the Director of Development to enter into a grant agreement with Columbus Metropolitan Housing Authority(CMHA) in an amount up to $4,800,000.00; to authorize CMHA to assign the agreement to Nelson Park Preservation Associates LLC as the administrative member; to authorize the expenditure of up to $4,800,000.00 from the Affordable Housing Bond Fund in support of the acquisition and redevelopment of Nelson Park Apartments; and to declare an emergency. ($4,800,000.00)
Body
WHEREAS, the Director of Development seeks to enter into a grant agreement with Columbus Metropolitan Housing Authority for redevelopment of Nelson Park Apartments a 177-unit affordable housing project in the Eastgate neighborhood; and
WHEREAS, City Council hereby authorizes Columbus Metropolitan Housing Authority to assign its rights, duties, and obligations under the grant agreement to Nelson Park Preservation Associates, LLC, except that Columbus Metropolitan Housing Authority shall remain responsible for the indemnification, reporting, and compliance obligations of the grant agreement as set forth in the copy of the agreement on file with the Department of Development; and
WHEREAS, MHP Nelson Park, Inc. is the administrative member of the managing member (Nelson Park Manager LLC) of Nelson Park Preservation Associates LLC. MHP Nelson Park, Inc. is a wholly owned subsidiary of Metropolitan Housing Partners, Inc. and Metropolitan Housing Partners, Inc. is a wholly owned subsidiary of the Columbus Metropolitan Housing Authority (CMHA) and CMHA will hold title. In addition to being co-owners of the project as members of Nelson Park Preservation Associates LLC - Renewal Housing Associates LLC, The Orlean Company and CMHA - are all co-developers of the project; and
WHEREAS, due to its size, building obsolescence and resident mix, Nelson Park has been challenging to manage, operate and maintain effectively, and has been the scene of numerous episodes of violence and crime; and
WHEREAS, Nelson Park Apartments overall footprint and population of the property will be reduced from 47 residential buildings to 42 residential buildings and from 177 units to 140 units. Post-rehab, there will be 14 elderly buildings with four (4) 1-BR units in each and 28 family buildings with two (2) 2-BR units and one (1) 3-BR unit in each; and
WHEREAS, the project is within steps of COTA bus stops Residents will also continue to benefit from a Central Ohio Transit Authority (COTA) Bus Stop on the property at the corner of Nelson Road and Maryland Avenue, as well as the 30-acre park (Nelson Park) managed and maintained by the City’s Recreation and Parks Department that provides immediate access to athletic fields, basketball courts, playgrounds, a shelter house, lighted walking trails and the Alum Creek Greenway bike trails. Importantly, all existing residents at the property will remain at the property and during the rehab,
temporary relocation will occur on site minimizing disruption of the lives of residents; and
WHEREAS, an amendment to the 2024 Capital Improvement Budget is needed to establish sufficient authority for this project; and
WHEREAS, the transfer and expenditure within Fund 7779 in an amount up to $4,800,000.00 is authorized; and
WHEREAS, CMHA will be authorized to assign the agreement to Nelson Park Preservation Associates LLC as the administrative member, subject to approval of ownership and control documentation by the City Attorney’s Office; and
WHEREAS, an emergency exists in the usual daily operation of the Department of Development in that it is immediately necessary to authorize the Director to enter into a grant agreement in order to maintain the project schedule set forth by HUD, all for the immediate preservation of the public health, peace, property, safety and welfare; and NOW,THEREFORE,
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF COLUMBUS:
SECTION 1. That the Director of the Department of Development be and is hereby authorized to enter into a grant agreement with Columbus Metropolitan Housing Authority in an amount up to $4,800,000.00 in support of the redevelopment of Nelson Park Apartments, currently a 177-unit affordable housing development project in the Eastgate neighborhood.
SECTION 2. City Council hereby authorizes Columbus Metropolitan Housing Authority to assign its rights, duties, and obligations under the grant agreement to Nelson Park Preservation Associates, LLC, subject to approval of ownership and control documentation by the City Attorney’s Office. Columbus Metropolitan Housing Authority shall remain responsible for the indemnification, reporting, and compliance obligations of the grant agreement as set forth in the copy of the agreement on file with the Department of Development.
SECTION 3. That the 2024 Capital Improvements Budget be amended as follows to establish sufficient authority for this project:
Fund / Project / Project Name (Funding Source) / C.I.B. / Change / C.I.B. as Amended
7779 / P782012-100000 / Affordable Housing Funds (Voted Carryover) / $10,468,598.00/ ($4,800,000.00) / $5,668,598.00
7779 / P782050-100011 / Nelson Park Apartments Rehabilitation (Voted Carryover) / $0 / $4,800,000.00 / $4,800,000.00
SECTION 4. That the transfer of $4,800,000.00 or so much thereof as may be needed, is hereby authorized within Fund 7779 (Affordable Housing Bond fund), Dept-Div 44-10 (Housing) per the account codes in the attachment to this ordinance.
SECTION 5. That for the purpose as stated in Section 1, the expenditure of $4,800,000.00, or so much thereof as may be necessary, is hereby authorized in fund 7779 (Affordable Housing Bond fund), Project P782050-100011, Dept. 44-10 (Housing), in Object Class 06 (Capital Outlay) per the accounting codes in the attachment to this ordinance.
SECTION 6. That the funds necessary to carry out the purpose of this ordinance are hereby deemed appropriated, and the City Auditor shall establish such accounting codes as necessary.
SECTION 7. That the City Auditor is authorized to make any accounting changes to revise the funding source for all contracts or contract modifications associated with this ordinance.
SECTION 8. That the City Auditor is hereby authorized to transfer the unencumbered balance in a project account to the unallocated balance account within the same fund upon receipt of certification by the Director of the Department administering said project that the project has been completed and the monies are no longer required for said project.
SECTION 9. That for the reasons stated in the Preamble hereto, which is hereby made a part hereof, this Ordinance is hereby declared to be an emergency measure and shall take effect and be in force from and after passage and approval by the Mayor or ten days after passage if the Mayor neither approves nor vetoes the same.