President and Board of Trustees

123 Madison Street Village of Oak Park Oak Park, Illinois 60302 www.oak-park.us Meeting Minutes President and Board of Trustees Monday, July 25, 2016 7:00 PM Village Hall I. Call to Order Village President Abu-Taleb called the meeting to order at 7:05 P.M. II. Roll Call Present: 6- Village Trustee Barber, Village Trustee Brewer, Village Trustee Button Ott, Village Trustee Lueck, Village Trustee Tucker, and Village President Abu-Taleb Absent: 1- Village Trustee Salzman III. Agenda Approval It was moved by Village Trustee Tucker, seconded by Village Trustee Barber, to approve the agenda. A voice vote was taken and the motion was approved. V. Public Comment Bridgett Hedgeman, on behalf of the residents of the 1200 block of N. Euclid. Ms. Hedgeman spoke about traffic turning illegally and going south down that street, despite the one-way sign. She asked the board for assistance in finding a solution. VI. Regular Agenda A. ID 16-231 Review of Village’s Affordable Housing Activities and Obtain Direction for Future Affordable Housing Activities Village Manager Pavlicek stated that earlier this year during the approval process of the District House, the Board discussed contributions for affordable housing for that development. At that time, staff proposed having a Special Meeting to discuss long term strategies relative to existing dollars the Village will receive from Lincoln Properties and the Direct House development as well as prior funds received. Director of Development Customer Services Tammy Grossman clarified that when discussing affordable housing, it refers to the housing cost burden to anyone, at any income level. It is generally thought of in terms of being affordable to only very low income people, but is based on relative income. Housing costs of less than 30% of one's income is considered affordable. If the Village is trying to target people in that very low income bracket, the market alone can't fix that. In order to correct it, there needs to be some type of subsidiary associated with the rental or owner markets in order for someone to live at that very low income level. Neighborhood Services Manager Drew Williams-Clark presented the ratio of rental units in the Village to households at various income levels and noted that the very low end and very high end are undersupplied. Subsidies are needed at the low end, as a unit at that Village of Oak Park Page 1 Printed on 9/7/2016 President and Board of Trustees Meeting Minutes July 25, 2016 level does not exist in the market. Lack of units at the high end reduces units available for medium income renters. However, some of the units coming on the the market in the next several years may increase the supply at the upper income level, which will flatten out the middle supply. He added that the figures in this presentation represent actual households, not estimates. Mr. Williams-Clark gave an overview of owner occupied units. When there is an oversupply in the middle of the owner market, upper income buyers will consistently outbid lower income buyers. This results in middle income units becoming more expensive due to the competition for the middle range. Again, at the lower income level, it is almost impossible to produce an owner occupied unit that will be affordable to a household making under $15,000 per year. The next items detailed the percentage of renter occupied households paying over 30% of their income on gross rent, as well as owner occupied households paying over 30% on monthly owner costs. He noted that 24% of renters are paying more than half their income on rent. Owner occupied households are in a better position. Mr. Williams-Clark stated that there are 3,991 units of affordable housing in the Village, which is 18.4% of all housing units . This is calculated by the Illinois Housing Development Authority and relates to the the Illinois Affordable Housing Planning and Appeals Act. This requires local governments that do not currently meet the minimum 10% affordable housing to establish an affordable housing plan. The Village is currently exempt from the Act but is at risk of becoming non-exempt. Mr. Williams-Clark explained how these figures are arrived at. He noted that there are currently 1,088 units of publicly subsidized, income restricted housing in Oak Park. He asked the Board if the Village should continue to fund its existing housing programs, which includes funding partner agencies and single family and rental rehab and improvement loans. Since 2012, the Village has invested over $9.9 million in these programs. Mr. Williams-Clark explained the small rental and single family rehab loan processes and how they keep rental stock affordable as well as allow homeowners to stay in their homes. He also described the multi-family incentives program, which helps keep racial diversity and integration in the housing stock as well as keeping owners from passing costs of improvements on to renters. Ms. Grossman asked the Board if 18% is where they want to be as a community. She also asked how the Village should invest the estimated $1 million allocated to the affordable housing funds from private developer contributions. The options are to offset the general revenue investments in existing programs, expand existing programs or create new programs or investments. In addition, should the Village continue to negotiate affordable housing incentives in redevelopment agreements to increase the affordable housing funds. Rob Breymaier, Executive Director of the Oak Park Regional Housing Center. Mr. Breymaier stated that the best way to promote racial integration is to have a market with a lot of moderately priced housing but also homes for very high income and low income people. He added that there seems to be a growing shortage of moderate housing. Eric Davis,on behalf of the Oak Park Housing Authority. Mr. Davis discussed the voucher program and noted that they are still working through a waiting list that has been closed since 2004. They feel that the current affordable housing projects are not sufficient to meet the needs of the Village. He discussed alternatives. Village President Abu-Taleb reiterated the questions staff was seeking direction for. There was discussion and the Trustees commented on the four items. Ms. Grossman and Mr. Williams-Clark answered questions from the Board. The Board expressed support for the programs and offered suggestions for changes and expansion. Village of Oak Park Page 2 Printed on 9/7/2016 President and Board of Trustees Meeting Minutes July 25, 2016 Village President Abu-Taleb stated that this is a program that benefits a lot of people in the community and cannot be addressed in isolation of everything else the Village is doing. He believes that an 18% level is a good level for Oak Park. The Village is not in the financial position to set any particular goal. In addition, the Village has not yet received the $1 million from the developers. Attracting economic development provides jobs for those who live in the community and helps to pay for their housing. He did not want to impose more burdens on potential developers without the opinion of the Economic Development Corporation after studying this further. He noted that CDBG funds are being utilized efficiently and the agencies that provide the affordable housing are doing a great job. He stated that the Village will keep the programs going, however, they will need to think about this further and hear more from staff about final recommendations. B. ID 16-241 Discussion Regarding the Oak Park Firefighters Pension Fund and Police Pension Fund. Village Manager Pavlicek commented that Mitch Serota, principal of Serota & Associates, is the actuary that was engaged by the Village in late 2015. His firm provides the Village with an actuarial analysis that's independent of the Oak Park Police Officers Pension Fund and the Firefighter's Pension Fund. Under State law, the Village is required to provide both of those funds. She added that the Village is starting its annual budget process. The Finance Committee will spend additional time on this in the fall, but staff wanted to talk to the Board regarding some changes in actuarial assumptions that will impact staff's recommendations relative to the property tax levy, which supports the two pension funds. Mr. Serota spoke about his credentials. He briefly explained how providing these pensions is mandatory under the law as well as how the cost of providing each pension is determined. He also described the various assumptions that are used when making these calculations. Mr. Serota stated that he used a more updated version of the mortality assumption table than the previous actuary. There had been no clear distinction between whether they were handling males or females, and although they were able to project forward to 2016, they did not project beyond 2000. It did not include progression in medical advances, nutritional advances, etc. and was not reflective of the mortality rates for the police and firefighters. In addition to demographics, they looked at present value of benefits, salaries, economics and the discount rate, which is the assumed return percentage on their investments. They determined that the discount rate be set at 6.75%, down from 7%, and explained why this is more realistic. Village President Abu-Taleb expressed concern regarding how the rate will make the Village look less funded compared to other municipalities who use a higher rate. Mr. Serota explained that it is important that the Board realize what the market value of the liability is. He stated that firefighters are 37% funded and police are 50% and suggested contributions of $4.1 million for fire and $4.9 for police for the coming year. There were comments and questions from the Board. VII. Adjourn It was moved by Village Trustee Tucker, seconded by Village Trustee Button Ott, to adjourn. A voice vote was taken and the motion was approved. Meeting adjourned at 8:59 P.M., Monday, July 25, 2016. Village of Oak Park Page 3 Printed on 9/7/2016 President and Board of Trustees Meeting Minutes July 25, 2016 Respectfully Submitted, MaryAnn Schoenneman Deputy Village Clerk Village of Oak Park Page 4 Printed on 9/7/2016