Thank you. I'm a little bit Thank you. So, you get everybody in their places, we will proceed. I do believe we have a quorum. First on the agenda, if you follow me on the agenda, we're going to discuss the Affordable Housing Trust Fund implementation and there is a PowerPoint, a copy of a PowerPoint presentation, which is really for reading. We're not going to put a PowerPoint up. And I'd like to call on Council Member Henson, who was chaired of the task force, to start this off, and we'll see where we go from there. Thank you, Chair. Actually, our agenda says implementation of a trust fund, but originally when this was put in the Economic and Development Committee, it was to research, and it's been a long time coming with the council committee reorganization, but it was actually to research the numbers from the Economic Development Affordable Housing Trust Fund impact study if we felt that these numbers were accurate and would generate both economically the dollars that it states and if it would help the number of folks find affordable housing if we felt that these numbers were accurate. With our reorganization, though, I felt that this is a very important topic that is very worth discussion. And I wanted to open it up, I guess, to see the thoughts of other council members, to find out where we go from here. The linchpin on this whole thing is whether we have the will at this point in this environment to do a tax increase. And if we did, what size would that be? And if we don't, then we'll look to better times, I guess, or look to an alternative of some sort. But we've kind of been going down the raising the insurance tax by 1%, and a tax is a tax as far as the public is concerned. they end up paying for it one way or another. And so that type of discussion, I'd like to see some people weigh in, if they would, on their feelings about a tax increase now, and if not, then when, and whether we revisit it each year, how we might do that. So anybody who wants to push that, we've got the Granica support, I think. And so if anybody would like to make a statement on this whole subject, either that or I'll appoint Steve Kaye to do, Council Member Kaye. Well, I don't have it. I've got to log in, don't I? Yes, sir. I did that on my other, I thought he was going to follow me, I guess. Yes, Chris, I'm sorry. Chris? Thank you, Councilman Beard. Just my initial thoughts, and I want to first thank the members of the council task force that Councilmember Henson has chaired. And we've been a long way around, dating back to the spring of 2008 on this issue. But I think what the most immediate actions before council has been the economic impact study that was performed for us and presented to us this spring. And Council Member Beard is right. An increase on the insurance premium tax, a tax increase is a tax increase. But I think a lot of the advocates of the Affordable Housing Trust Fund and creating one here in Lexington recognize it as an investment, an investment for the housing needs of the marginalized and low-income citizens of our community, and that that investment will also have a community impact upon the neighboring neighborhoods. But what I would like to focus on, and if I could, is recommend Council just to discuss the funding option, which to date has been the 1% increase on the insurance premium tax. And that recommendation came from the original trust fund commission that started its work in the summer of 2008. Again, the economic impact study that was performed and presented this spring spoke very favorably to that funding source. I do recognize that it's the council's purview that if it wishes to enact an affordable housing trust fund, there are a myriad of funding sources and funding source possibilities. But the one that has been studied in our community to date the most has been the insurance premium tax. And the only thing that I'll say about my reaction to the study is that it makes an economic sense for us to bring a trust fund here in Lexington. Once we decide on a funding source, there's still a lot of work yet to be done in regards to how we would implement a trust fund. But I think this represents one of the few times where government can enact a tax or a new fee, but it can have positive economic benefit to the community as a whole. and in the economic recession that we are in, we have to recognize that, of course, there is going to be some sensitivity to raising a tax, but I would encourage us to look for the overall good of the housing community in general and also the economic growth, be it jobs, construction jobs, that this trust fund can bring. So, again, thank you, Councilman Beard, and I look forward to hearing another conversation. Thank you, Council Member Ford. Vice Mayor Gordon. Thank you, Mr. Chair. First, I want to thank everyone who's been working so hard on this. I think that the studies that have been done and the really hard work by the Commission and all the folks involved has certainly shown me the need for a trust fund. I think for me that's not debatable. I have a process question, which I think the debatable item is how to fund the trust fund. That is the debate now because we've all gotten really good data from those of you who have worked really hard on this, and I don't think there's any debate that we need this. My process question goes back a little bit to what Council Member Ford just now said, some of his comments. In coming before us today, my question is, did the group go back and kind of regroup and consider some other alternatives, or was it more of a discussion of how to move this particular tax to the council? I know that at one point, and my details on this are a little fuzzy, but there was an offer made at BUILD to put money in the budget. And, of course, it wasn't enough money. We've seen the numbers that we need a few million dollars. But I wonder if there has been any more discussion on any other options. Or is this coming to us on the same track that it was? Do you know, Council Member Henson, or kind of a process question? I think early on, it's been so long ago, there was quite a bit of discussion about where we might find the funds. But all in all, we felt that the recommendation from the Trust Fund Commission was the best option that we had. So for today, for coming before us, it's basically the same proposal? Thank you. Correct. Thank you. Council Member Henson or Council Member Blues? She just deferred to you. Okay. Thank you, Mr. Chairman. And Council Member Henson is right, of course, that we looked at a number of different funding mechanisms and looking to a revenue source that would be the least onerous on our citizens. and yet at the same time bring in sufficient dollars to really create a fund that could then be leveraged for various levels of affordable housing projects. And when John Ferris did the study of the impact per households and the projected revenue that various levels of raises in the insurance tax, We considered the question, but I do not think ever resolved that whether an increase in the local insurance tax should exclude the health insurance fees that taxpayers pay. For myself, I think that that would be a fair exclusion, and at a 1% rate, we would be raising on an annual basis close to $4 million annually, which would be a workable number. What we do know from the original commission study, from the task force's work, is that, number one, adequate housing is the most important thing a community can provide to keep individuals and families above the poverty level and to give them a base on which they can function in our society. Housing is absolutely vital to that effort. We also know that providing affordable housing is an economic driver, an economic development driver, I should say, because a trust fund can leverage other funds through grants and other sources and can provide jobs as it provides housing. I think we know enough about, as well, how other communities who have implemented trust funds, they have been highly successful and they have been profitable for their cities. So what we have lacked so far is taking that major step, and that is to provide the mechanism by which the entire community can make a contribution not only to the benefits of citizens who lack adequate housing because they cannot afford it, but also provide benefits to the entire community in terms of economic development and providing necessary social services. So, of course, there is never a really good time to raise a tax. But in terms of an affordable housing trust fund, to make that happen, I think it's the only time. We need to act on what we know. We need to be able to ask our community to step up and do this. Thank you, Mr. Chair. Thank you. Council Member? Excuse me, Council Member Kay? Thank you, Chair. I just want to add my comments, kind of build on what's already been said. But a few points, I think, are important. And the first, the need is clearly there, and the existing apparatus for meeting those needs is not adequate. That is, there are people working on housing and affordable housing. There are other agencies and other sources of funding, but they're clearly not adequate to the need. Secondly, a consistent source of funding is crucial. We need to know and we need to be able to plan for the kind of housing improvements that we'd like to make. And without a consistent source of funding, we can't do that. Thirdly, as a couple of other speakers have already said, this is not just a way to meet human needs, but it is also important for economic development. I want to read the conclusion of the report, which was in the packet, but for the benefit of those in the audience and those watching. This is the report that was presented to the committee and reviewed by the Council in the spring. The conclusion says this. Assuming an 8 to 1 leverage ratio, which they document in the article, the estimated annual impact of a $4 million affordable housing trust fund investment include the following. an average of approximately 470 housing opportunities each year, including 150 new construction projects and 320 rehabilitation projects. More than 363 new jobs will be directly and indirectly supported by trust fund investment. More than $43.3 million of direct, indirect, and induced economic activity will be generated from trust fund investment. I think the case is clear. As Council Member Blue says, there's never a good time to increase fees or raise taxes. But this is something that this community has been talking about and working on for a very long time. And if we don't do it now, it's just going to get more and more of a problem for this community. We can look around at other communities that have not addressed this issue, and they begin to become communities that are not affordable for the range of people that we would like to have in our community, including those people who provide basic services for us. So I think this is the time to move forward on this. Thank you, Chair. Thank you, Council Member. Council Member Myers? Thank you, Mr. Chair. I guess having read the study and the presentation and hearing the comments that are made today, There's another side of the issue, and what we do know is that the best way to make housing affordable and the best way to lift families and people out of poverty is to provide a high-paying or well-paying job. So my question would be, what's this economic impact and this economic study say about creating jobs for folks so that they can afford housing? Thank you. I think that that was taken into consideration when Mr. Ferris actually did the study. He factored that in along with the leveraging. In fact, you mentioned, did you not, Council Member Kaye, the number of jobs that was anticipated? I take Council Member Meyer's question to be more about the broader question. of generating jobs in the community aside from this particular effort. Is that correct? That's correct. My position is that if you create jobs that are high-paying, I can then get one of those jobs and pay for housing rather than raising taxes to try to build housing that's specifically affordable. If we create jobs, we put new money back into the economy. people have the money to buy a house or an apartment or a condo or whatever it is they want to do. And that's the reverse side of the issue is we can raise taxes and do a government program to build housing. We already have a housing authority that does part of that work. Mine is on the other side of the issue, and that is if you provide a good-paying job for me, then I don't need you to build affordable housing. I can just go buy a house or I can rent an apartment or whatever I want to do. So I understand that people say this will create jobs, but, again, I still want to hear why we're not looking at what we can do in terms of iconic development to create jobs and provide avenues for people to get a job that will then allow them to afford housing. Thank you. I'm not sure exactly whether to attempt even to answer your comments. You know, we're talking about the affordable housing today. Obviously, we've got folks that are involved, Kevin Atkins being one of them, on the creation of other jobs. That's another discussion and another time, I think, Council Member. Unless, Kevin, you'd like to make some comments. Can somebody answer? I don't know. Council Member Myers, I guess the best answer I would have at this juncture, if I'm understanding the question correctly, is that it is an ongoing process. I mean, it's a daily, hourly process. When we wrap up here, I'm getting in a car and driving with two of my colleagues from Commerce Lexington to meet this afternoon with a possible company that's looking at putting jobs in the community. So it's something we do every day. Thank you, Mr. Atkins. And the question really wasn't posed to you because I don't want people to think that what I'm saying is that you're not doing your job or that we're not looking to create jobs in this community because you guys are. My question was for the task force that came up with the idea that we ought to raise taxes and build affordable housing. For the task force that came up with this plan, my question is why as a community we're not looking at ways of creating high-paying jobs here. If the University of Kentucky here, Transylvania, and all these other colleges we have here, Why are we not looking at trying to keep brain drain from happening, keep those folks here, creating jobs so that the people who live here can afford housing rather than going down this avenue to solve the housing issue? And I guess the other question I would ask is, you know, a lot of people would ask what's affordable and how is that determined? And I understand there's a process for coming up with a number and saying this is affordable, this isn't affordable, But really, it still goes back to if I have a good-paying job, then I can go out and buy the housing that I want, and I can go out and do the things to take care of myself and my family that I want to do. So it was more for the task force. They said this is the way that we ought to approach solving this issue. I want to know what their thoughts were on just creating good, high-paying jobs here so that people can afford to buy housing, whatever type of housing they want. Thank you. And I guess if I could say the reason I'm asking that question is because if they're asking us to take their recommendation to raise taxes to do this, my question is how did they arrive at this instead of that? Thank you. Council Member McCord. Thank you, Chair. I want to, I guess, piggyback on what Council Member Myers said. You know, we're a payroll tax-dependent city, so jobs is what drives our general fund. 83% of our fund for this government comes from having a job inside the arbitrary boundary of Fayette County. And so if we don't have jobs inside that, good-paying jobs, then this government can't provide services. So what Council Member Myers is saying is that affordable housing can be defined in a lot of different ways, And if I have a job that allows me a wage to pay for housing, then it becomes affordable for me. And what are we as a government doing for job creation and job growth, and what can we do more to make this a city where there are a lot of jobs and a lot of good jobs and a lot of opportunity? Let me shift from that just a second. I've heard that there is a need. I see the study. I hear all these types of things. But is this the number one need in Lexington, Kentucky, the number one need to go to bat and raise taxes for? Is this absolutely the paramount issue of our day in this city to raise taxes for in a time that is only equal to the Great Depression nationally? When our public safety folks have an underfunded pension fund, when we are getting crippled by rising health care costs, when we've got failing infrastructure, is this the number one need that this council needs to take up? Now, I've heard from a lot of folks from the community, but I haven't heard a community outcry. But if I'm told that there's a community outcry, this is what I'm going to say. I will vote right now to put it on for public referendum and let the public vote. I'm not going to raise taxes at all. Not in this time frame. But I certainly would support putting it on for public referendum. And if folks believe this is the number one issue, fine. Let the public decide. And if Lexington says so, I'd support that. Thank you. Thank you, Council Member Gord. Council Member Hanson, you're up. Thank you, Chair. I, as a chair of the task force, and also we have a member of the task force sitting in the audience, I was wondering if at some point he would be able to speak, David Christensen. Yeah, that would be fine with me. Okay. And, you know, I guess this is a very difficult, complex issue because of the present economy. There are many, many people that need affordable housing that already have jobs. but because of the cost of living and so forth, they still need affordable housing. They can't make it on $8, even $9 an hour. When I have a single mother that comes to me and says she's living in what I call housing by neglect because that's what she can afford. And she's like, I would move, but I can't afford to move, but I do not feel safe where I'm living. Every person in Fayette County deserves a safe, high quality of life if they work for it and that's exactly what they deserve. However, when you look at funding this trust fund, you're talking about the average cost, $30 a year. $3, not even $3 a month. That's if we exclude health insurance. And I really, you know, would I give $30 a year so someone can have adequate housing? Absolutely. But then on the other hand, we look at it, and, you know, there are families struggling. Would $30 a year make or break them? You know, I think not. But we're not talking about an enormous amount of money. But I can say more later. Thank you. Thank you. um council member ford uh if you would defer for a second let uh council member martin has not had an opportunity to speak yet council member martin thank you chair um i have a couple questions and i haven't been on the economic development committee so i'm going to catch up a little bit the i guess the first question is and maybe council member henson you might address that or the Chair, but who would be managing the trust fund? So who would be making the decisions about the expenditure of funds in the trust fund? Julia? I can't, Mr. Beard, if I can. Sorry, excuse me, on behalf of Council Member Henson. In 2008, when the initial commission, the Trust Fund Commission, was convened by Mayor Newberry, it was about 47 community members with different backgrounds. The initial focuses were funding, and administrative was one of them. We're focusing on funding right now. And I'll be very honest, since that time, not a great deal of attention has been focused on how we would administer or implement it, because our greatest focus to this point has been the funding piece. The initial report, though, however, back in 2008, called for an administrative agent. Most trust funds across the country have an administrative agent. It can be a form of government, an arm of government. It can be a nonprofit. It can be somebody in the private sector that works with the community and that advisory board that ensures public input to the trust fund to administer those funds. So in short, we have not gotten to that point yet because of the concentration and worthy focus and emphasis on examining the funding component. But nationwide, there are 600 trust funds across the nation. Most of them are administered by an appointed or designated administrative agent. I guess I would like to sort of understand that structure, because there are some folks who I would happily give $4 million to in this town who could do a great job, and there are some folks who maybe not. And so understanding that mechanism I think is important to this process. The second question is, where did the $4 million number come from? Is that a significant number, or is it just simply twice as $2 million? Is there a threshold that that brings us to, or does that mean some minimum requirement? I'm just trying to understand where that number comes from. I know it comes from the 1%, but is that we just want to do more than half a percent? I'm just trying to understand where did that level come from. I think we came with that as thinking of what, you know, when you look at what the need is and how much money would be generated or need to be generated to put a dent in the problem, then the 1% was adequate. Anything less than that, it would certainly help, but it would not be adequate, completely adequate, I should say. But if we excluded health insurance, it would generate, I believe, $3.3 million. So that would be the way that I would be leaning toward. As Council Member McCord indicated, obviously there's some other funding needs in government as well. And I think it's important that we really step back and look at what our needs are going to be for the next year. I support doing something here because I think that it's not like we're going to have more money in five years. We're not. And so we can't wait until we have enough money to do this. But at the same time, I think similar to the way the vote on South Limestone was. Folks who are here remember the vote a couple of years ago to redo South Limestone. As a new council member, I didn't know that we had a vote coming up in a month or a month and a half for a $70 million bond for the police and fire pension. And so as we make this decision, I'd like to understand what are the other funding decisions that we're going to be making in the next year or two years so that we can make an informed decision in context. And so that, I mean, I think we really need to do something here. I'd like to know who's going to be administering it, and those details I think are important. But also I'd like the administration to maybe bring us some information about what are we looking at in the next couple of years as far as other funding needs, because this decision will affect our other funding decisions as we come across them. And we need to make it purposely and in an informed way. Thank you, Chair. Thank you, Council Member. The administration is on their way here as we speak. Vice Mayor Gordon, I think you're next on the... Well, thank you very much, Mr. Chair. I kind of want to wait until Richard Maloney, the CAO, gets here, but I guess I will ask Mr. Adkins, well, first I'll ask Chair Henson, Are you expecting a motion today? Because my question is, does the administration support this exact plan? I was not expecting, to be perfectly honest. I felt like, you know, although many of us are well-versed on the need for the trust fund and the jobs it would generate and the housing it would generate. I would think, in reference to what Council Member Martin said, maybe a presentation would be in order to the full council. I mean, I know this is a full council, but it might be something we would have to pay for. Or maybe David Christian would be willing to do a presentation that would answer all those questions for you. Most all the answers are in the study. Okay. So my question then, and we can let it linger until Mr. Maloney gets here if you want to, but I would ask, I think it's important for the council to know, since everything that we do has to be either signed by the mayor or passed unsigned or vetoed, whether the administration supports this plan. So if we can, maybe when Richard gets here, he's running in as we speak. So that would be my question. Okay, does he know why he's here? I'm not sure, but he may need a nurse. Oh, you've got a boot on. Sorry, Emily. I hope you haven't been kicking people. No, they've been kicking me. My question that we're discussing the Affordable Housing Trust Fund and the proposal for the 1% tax increase on insurance, and as you know, counsel, everything we do either requires the signature, the veto, or the pass without the mayor's signature, and I wonder if the administration is supportive of this plan. As of right now, the administration is not supportive of any tax increase, but they do support the affordable housing. We put $100,000 in the budget. We tried to in the budget this year, but the group we were working with said they were not interested, so we pulled that out. but we do have a lot of interest in affordable housing. But as of right now with the economy and the way things are right now, we just feel best not to do the 1% on anything. Okay, I appreciate that. I'm sorry you had to run in with that. Oh, that's all right. Council Member Stennett. Thank you, Chair. Just a couple thoughts and a couple questions that I don't think have been answered today or in the past. And it goes back to some of the comments Council Member Martin made. And the first question I think you asked, Council Member Martin, is what is the true need as it stands today in 2011 going into 2012 in our community? And I think that's a very difficult thing to put a firm number on because when you talk about we need $4 million, well, that's kind of backing into the number based on 1% of insurance. That's not really saying here's what our real need is. Is it $2 million, $4 million? It may be $6 million. And I see some people out in the audience maybe shaking their heads, but that's the truth. We didn't come up with an arbitrary number of $4 million out there just to say that's what we really, truly need in this community. No one knows that at all in this community about what our true dollar amount. So having said that, we do know there is a need out there, and how we're going to measure and quantify that need is one topic we need to explore. Secondly, a summation of other agencies. I'm not sure, Councilman Henson, if the task force looked at what other agencies and what other funding mechanisms are available, but is there a summation of those agencies, Council Member Henson? Did you all look at other agencies and the total amount of local funds currently being contributed towards the affordable housing issue? Are we able to get a handle on that as well? The task force did not. Okay. But now the commission did. Correct. So then that's another thing this council would want to explore is what other avenues are currently being explored out there and what funds are being utilized. For instance, home funds from CDBG is going towards affordable housing in our community. So this assuming would supplement those funds. Looking at that question. Also, as Council Member Martin said, who's going to administer the fund? Have we looked at even starting it now today with a nonprofit-based setup and letting people contribute, as Council Member Henson suggested? What's prohibiting us from going out there and raising money like our other nonprofits and foundations do today? Let's get something off the ground, and maybe the ball will start rolling down the street. If we get more than one person contributing $30 to the fund, maybe that is a way to start this thing and getting the public behind it going that route. So there's a lot of other options I think have been sitting here today saying, well, we just can't raise taxes. I think there are ways to get this thing off the ground and get it running. Let's get the infrastructure set up, same as we did on the stormwater fee. We didn't just create a fee and say, hey, we're going to charge this fee. We had the infrastructure of the fee, who was going to administer it, who was going to bill it. We had all those things done first three years ago when we did that fee. I think we need to hone in on that, get it set up, and let's start it. Let's go ahead and start it. We don't have to have the exact funding or perpetual funding in place immediately. We can start soliciting nonprofit donations and things like that. And let's see what the interest is and start helping people today rather than keep pushing it down the road and waiting and waiting and waiting until there's a – because this is not the silver bullet. But my point of asking for the summation of the community effort is that there's other people out there doing this, too, that we need to help and join in the effort. This is not the only solve-all, be-all out there. There are other ways to conquer this problem in our community. And obviously it's no secret what our current funding situation is here locally. So those are just some questions I would hope we can look at as the infrastructure of who's going to administer it, get that in place, look at a summation of what other agencies are doing out there and what the total available affordable funds are now and how will this supplement that. and also really examine what our true need is because I know Mr. Ferris' study is not current numbers. Those are not numbers in today's economy. And a lot of things have changed. Even in the last six months, some things have changed in our economy drastically. And I know the rental market is flooded with people out there looking for homes that are not available right now. And I understand that need because there aren't homes available. People in that business can tell you their occupancy rates are very high right now, very high, because people are losing homes right now and looking to rent. So how do we balance that with the homes out there sitting empty? Will this program have an education component? Because let's face it, not everyone can not simply afford a home because they don't make enough money. The question is, where is that money going? Sometimes their credit score is not good. I know programs like REACH that Council Member Ford works with educate people on how to get that credit score up. It's harder than ever to qualify for a home right now for people in the industry. It's very hard to qualify, even with people with good credit scores. So how will that play into if we start a fund today? So those are just some comments and questions, Chair, and I'll leave it to the next speaker. Thank you. Thank you, Council Member. David, if you would, just for the public and everybody, introduce yourself and your address, if you would. My name is David Christensen. My address is 4844 Brennan Drive here in Lexington. I served as the co-chair of the original commission and served as a member of the task force. There's a whole lot of questions that have been asked here that I would be happy to have a shot at. I don't know that I can provide all the answers, but a lot of the administrative questions, the structure has been developed so that if money is available, there will be a bid process, a proposal process, And the most competitive agencies, some for-profit and non-profit, would then be graded by the staff in the 11-member advisory board. And some of the preferences would be high leveraging, points given for the folks that can bring in more money than we're putting forward. Like Councilman Ford said, this is a highly leveraged process. In my mind, it's fundamentally different than other uses of money that we tax for, because this one pays for itself over time, but it also pays for itself immediately. the Ferris study indicates our original estimate from the commission was that we should shoot for a 6-to-1 leveraging match. They came back from their research and said it wouldn't be unreasonable to get a 10-to-1 leveraging, and it would be easier to do a 5-to-1 leveraging, and 8-to-1 was reasonable. So if we come up with $4 million, we're going to bring in, on average, according to their study, $32 million worth of investment, largely in construction. The reason we didn't take on the opposite end of the equation, in other words, people's survival is they've got to pay for their expenses and they've got to raise enough money to do it. That wasn't our mandate. For either of these groups, it was not our mandate to create jobs to raise incomes and stuff. If you want to do that and if you believe in government having a role in it, I would suggest a living wage pass through this body. That wasn't our mandate. Our mandate was to look at the housing crisis that exists here and come up with some solutions. What we did in both instances was a lot of research looking how other communities have dealt with it. The private market, which everybody would like to see solve this, has not worked particularly at the bottom level. In terms of need, the original commission came up with about $80 million. We did not just jump at the $4 million and back into it. Actually, it was the other way around. It was tremendous. There was one whole committee that was devoted to funding mechanisms. They looked at it high and low, rejected a whole lot, and finally came up with this one for a whole number of reasons, mostly that it was broad-based. It was a very small amount on each household, but it would generate a big chunk of money and get the process started. $4 million, in terms of our estimate, was that that would be a shock at getting it started. It might take 20 years before you would really make a serious dent. Right now, 47% of all the renters in our town pay more than what HUD considers a reasonable amount for rent. Housing affordability came up. What is it? According to HUD, it's 30% of your gross income. If you're paying more than that, whether it's payments on a house or rent, it's not affordable. That's when you get into how much can I afford in terms of buying a house and stuff or get a loan. Oftentimes they go down to the 28. But basically, if you're an individual or a family that's paying more than that 30%, your housing is unaffordable. And almost half the renters in our city now have unaffordable housing. The commission recommendation was that this funding would go all the way up to 100% of area median income. So this funding pot can help people buy homes, sustain homes, sustain their rents. It's fairly broad-based. That's been a successful formula. It's worked in other communities. That's all of the comments that I had piled up into my head. A lot of this stuff's been dealt with. Those of us that have been banging away at this for three years would answer your question saying absolutely. I don't know that I would go so far to say it's the one that I would say personally that's the number one need. But not having reviewed every other need in the community, I would say it's clearly got to be important enough that something needs to be done about it. And we've got to get past our taxophobia. And that's why second Councilman's floor, this is not a tax in the traditional sense. Sure, it's going to come out of your pocket a little bit, a few mocha javas a year. But it's an investment. Where else, when you tax somebody, do you get $10 or $8 for every dollar you pony up? And why wait three years from now when hopefully the economy is going to be better to put together an initiative that's going to create three or four hundred jobs? I don't know what I say now, but that's my speech. You're fine for the moment. You said a lot. I don't know if the council wants to ask you any questions. Yeah. Council, I understand. First of all, thank you. I can tell you're very passionate about this issue, and I appreciate you're one of the few in regards to this issue that I've addressed respectfully and present a good argument. And I appreciate that because what you say, a lot of it makes sense. Some of the questions I do have for you on the commission's $80 million. When was that number taken? Was that in 2000? That was three years ago. So do you think that number would be more today, but given the economy? Absolutely. So would it be double now? No, I wouldn't go that high. But it's going to be more. Our unemployment rate has increased by 50%. And how do you measure that number? How would we go out and get it today if we wanted to quantify that number? We actually approached it from the bottom up. We looked at all the different nonprofit proposals that were sent in to various bodies at the state level, the local level, home money, C, B, G, state and local, and looked at how many projects were not funded because there was insufficient funds to fund all of them. We came up with about $8 or $10 million on an annual basis were happening there. Then we approached it from the other end saying, all right, if we take all these renters, 18% of folks are paying half of their gross income before taxes are taken out or anything else to put a roof over their head. If we take all those folks and say, okay, what kind of money is it going to take to create the amount of units, 17,000, 20,000 units that would be managed where a person was allowed to pay no more than 30%, then we came up with some huge numbers. If we as a city said, okay, nobody in our city is going to live paying unaffordable rents or home payments. So, you know, it was a very difficult figure to get a handle on. But there was a whole group that worked on the commission to try to narrow it down. Every single one of the questions that you all had came up more than a few times. The need question keeps coming up more and more. We have relatively affordable home prices in our city when you look at New York and the old days in California and Florida and places like that. That tends to obfuscate the issue a little bit because what happens is that folks, the private sector finds it almost impossible to build housing that folks who make minimum wage can live in. It just does not pencil out if we could raise the minimum wage and everybody's got money. Then the problem, the other counter argument, Councilman Myers, is if everybody's got more money, then you have more money chasing after the housing that's not there. So in some senses, you need to do both at the same time. We need to create more units that are not only affordable but safe. And that's, you get into enforcement issues and you say, we've got to have safe housing. Let's close down all these places that are dangerous. Well, then people don't have anything because that's all they can afford was substandard housing. I got sidetracked. You're fine. I appreciate that. I appreciate the passion to that answer. Do you have a summation of the local groups in our local economy that is currently putting funds towards affordable housing issue? I don't have it written, but I have it sort of in my head. I just didn't know if someone already had done that list of what the Housing Authority does, you know, what they could do, things like that. Also, some of that's in the consolidated plan, but it's also that I'm the executive director of the Central Kentucky Housing and Homeless Initiative, and a lot of those groups come to our meetings, provide services not only to homeless but housing programs to try to move people into permanent housing. It would just be nice to get kind of a list of what's currently being done and how can we add to that? And last but not least, have you all looked at going ahead and starting some type of affordable housing trust fund on your own and doing a capital campaign and start raising money today and get the bar rolling, set the example, and blaze the trail, so to speak? The advice that we received from Mary Brooks, who works with the National Housing Trust Fund, said that oftentimes bringing up the specter of doing things independently reduces the energy to get a government commitment. The whole idea of an affordable housing trust fund is not just to raise money and address the issue, but to have communities acknowledge the fact that there needs to be some level of commitment from the local community. And what happens is that increases the commitment that you can get from low-income housing tax credits, federal, other entities, because we've stepped up to the plate. Here's some money. This fund is never intended to give one project $4 million. We're hoping that this is a conduit that still is in. We had advice from the state affordable housing trust fund. They said if you can make your recommendation more flexible, we can take state affordable housing dollars and put them with your dollars because there are some things we can't do if you allow it. It's a great marriage and we can have more housing. Right now there's a lot of Habitat for Humanity, Reach. There's a lot of entities that are involved in trying to do this, but collectively we're losing the battle. this is a way for us as a community to step up to the plate and say this there's a need it's extremely important and we're willing to invest in our community as a whole and housing is an extremely important part of what makes a healthy community thank you i appreciate the answer thank you um council member ford okay then council member blues thank you council member Beard, I wanted to thank David. David, I don't have a question for you because we worked, all of us collectively have so hard since the spring of 2008. And I want to say to the council that I believe that our time is now, finally, to have some resolve on this issue of what will we do as a local government for affordable housing. So I have several comments I'm going to try to definitely get to in my five minutes. The trust fund, a basic definition of a trust fund is that it is a publicly dedicated source of funds. Every trust fund across the country, it is publicly dedicated, and that is a tax. Council Member Beard, we recognize that is a tax or a fee that the local government or that unit of government levies to bring in those funds. Anything less would not be a trust fund. So we have had proposals to capitalize and to do fundraisers and donations. That does not represent the essence of what a true trust fund is because a trust fund has to be able to consistently forecast and provide funds to tackle the housing need. I know that some of our conversation has gotten off a little sidetracked, but that's what committees are for to discuss them. But I kind of want us to refocus away from the need. The need is there. If we're spending every dollar that we have as a government in our community, the need is definitely there and will always be there. The trust fund is an attempt to work towards addressing that need a little bit more. The city of Louisville enacted a trust fund. It enacted a trust fund. It had an organization. It did all the things except what it should have done first, in my opinion, which is to solve the funding issue. They had a million dollars capitalized, but they, if I understand it correctly, still have yet to have that trust fund working as it should in its city. And to our credit, in our community, this has been three years going. And some would say we're kind of stuck on this issue, but it's an issue worthy of being concentrated at this point. Because without a publicly dedicated source, you don't have a trust fund. You have something else. I'm not certain what that truly is. So I really want us to kind of focus back on the essence of the funding of the trust fund. Mr. Ferris' report, he presented to us this spring, and we wanted to bring it, the task force that is, wanted to bring it to the Economic Development Committee. Not to solely discuss the housing needs or the importance of the housing needs in our community, but to examine this report to see if these numbers make sense. And again, these numbers are fluid to an extent, meaning that nothing is set in stone. You know, there has been a great political will. Council Member McCord mentioned that if there is a public sentiment, excuse me, for us to discuss this issue, the only reason, in my opinion, we're discussing it is because the public brought it up. It was a coalition of churches bill that brought this to the local government's attention. in the winter and spring of 2008. And to their credit, they have kept it at the forefront. I think it's time for the council to really speak on this issue. A 1% in the insurance premium tax, and it's on page 3 of the report, and I know we all have those in our offices, would generate $3.8 million at a cost of $30, an impact of $30 per household. So if the council only wanted to increase the insurance premium tax by one-half percent, it would generate $1.9 million, a $15 impact to households. So if you're going to levy a tax, a dedicated source, it will have some impact. But I think to the credit of the commission and the task force, great effort has been made to minimize the direct economic impact to respective households, our constituents, and to realize the greatest impact thereof. To Councilman McCord, I won't say that this is the number one need. It is definitely one of the greatest needs. No doubt about it. I think all of us agree to that. I would argue that every district in our, of the 12 district, could be benefited by the creation of a trust fund. There is need all across Lexington. So our citizens would support that. Mr. McCoy mentioned a referendum. Again, that's a valid, if we want to discuss that, if we want to, I would rather that the council take an issue to this. Last thing I'll say, Councilman Beard, and I know I'm over my time. But in the scheme of things, this is my understanding of affordable housing in Lexington. And collectively, as nonprofit agencies and as a government and the housing authority, we do a pretty good job. But there is still a need. I don't ever want us to get confused that we got it solved or there's enough need or just send everybody to the housing authority. The reason we need a trust fund is because there is still enough need there. This trust fund also gives our government the opportunity to finally get some skin in the game. The federal government, the state government, the local government, all of the affordable housing monies that come to Lexington, we're recipients. Federally from HUD, state from Kentucky Housing Corporation, and to the credit of all the other nonprofits that do their respective fundraising. Local government, and I'll stand corrected if need be, but my understanding is we do not have any skin in the game in regards to affordable housing. And that's not to embarrass us. That's not to embarrass us at all. The value and importance of us having skin in the game with the Affordable Housing Trust Fund, it would let our affordable housing community do just that much more. We have a lot of project managers and developers in our community. They build great projects. But some of the most neediest projects they cannot build because there is still a gap. This trust fund would close that gap. So, Council Member Beard, that concludes my comments. I would ask the expertise of this committee to really focus on the funding source. Because without that, you guys, everything else is for naught. who administers it, all those things are for not unless we can really start making a discussion about the funding source and if it makes economic sense to this government and to our constituents. Thank you, Mr. Beard. Thank you, Council Member Ford. Council Member Blues? Thank you, Mr. Chairman. and I think this has been a valuable discussion as we bring the affordable housing question back into visibility and to begin to get some sense of the questions that need to be answered and of a path we might need to define and go forward on. I think the questions about an administrative structure about the $4 million number, why that is an optimal number. The question about what we have going for Lexington now as a community in terms of affordable housing efforts and at what point, as Councilmember Stinnett suggested, can we actually get something started. I think Councilmember Martin's question about what other expenses are we facing as a community is a good one as well. And there's no question that we're facing a number of them. The costs are not going to go down, and they are going to go up. Our utilities are going to cost us more. Our sanitary sewer fund is going to cost us more, and so on. So there are costs. And I would add one other question with reference to costs is what is the cost of inadequate housing? What's the cost of homelessness in our community? What does it cost us as a community to support poverty? These are questions that we need to ask as well going forward. The extent to which inadequate housing, housing that costs so many more people, more than 30% of their income. What does that cost us as a community when people have to make the sorts of choices that they do about how to allocate declining funds? As all of our expenses go up, wages we know are not going up. More people face the danger of poverty, and it's important that we know what these costs are and what we as a community are willing to pay to address them. Thank you, Mr. Chairman. Thank you, Council Member. We do have another presentation on the agenda, so if you could shorten your statement somewhat, But we might be able to let Mr. Harvey get up here in a minute. Council Member Kaye? Thank you, Chair. I agree with Council Member Blues. There are a lot of questions that remain to be answered. I think this has been a good initial conversation. I did want to add a little bit more information for those watching and for those sitting in the audience. I circulated a paper to the other council members yesterday to try to summarize some of the questions that I thought might be asked, and I want to refer to that and answer a few of the questions that have been asked or begin to answer them. First, I think it's important to be clear about what it means to live in housing that is not affordable. And this is, again, the HUD definition, paying more than 30 percent of your income for housing. and what they say is that families that pay more than 30% of their income for housing are considered cost-burdened and may have difficulty affording necessities such as food, clothing, transportation, and medical care. So what that means is that there are people in the community who have to make a decision between paying their rent and eating or having medical care or being adequately fed or clothed. Those are the decisions they have to make. That's what it means in concrete terms. And I know that many people sitting around the horseshoe and in the community know families that have had to move out of housing because they could not meet one or more of those needs. Secondly, the question about the extent of need, and this is just one piece of it, but the public housing plan prepared by the Lexington Housing Authority provided to LFUCG in April 2011 says that there were 1,171 families waiting for a public housing unit. It says that there were 349 families on the Section 8 waiting list. That list had been closed since October of 2010. Thirdly, Councilmember Blues has alluded to the social cost. And there are, again, forgive me if I just read a little bit. Multiple studies have found that the lack of affordable housing actually costs the city money in public education, criminal justice, health care, and transportation costs. And it goes on to cite some studies. Charlotte Mecklenburg estimated that it cost them pretty much $50 million annually for not addressing those issues. Lee County, Florida, I found the cost was $249 million. Extrapolated to Fayette County, that cost would be roughly $150 million annually. Social cost for not addressing the issues related to unaffordable housing. And finally, the issue of transiency. People often confuse the role of urban county government with that of the school system. One of the ways we can address that issue is by focusing on families that are transient. their students suffer greatly in the school system. Thank you, Chair. Thank you, Council Member Kay. Council Member Martin. Thank you, Chair. Perhaps our gentleman from the task force could help me kind of work through some things. And let me just say as a precursor, we all know how hot a debate goes here on the council. I mean, and sometimes we bring things up in order to slow things down and kill things, and that's not my desire here. I think that when you come and ask for $4 million through a new tax, we've got to get some details on it. And so help me understand how this is going to work. So assuming we've raised the money and we've got $4 million and you've leveraged it into $32 million or $28 million or however long it is, how do the deals get done? You take the money and you build something. Is that correct? Is it apartments, single-family, duplexes? What gets built? Largely left up to the recommendation of none of this is in stone. and as Councilman Ford has said, the recommendation of the original commission was to establish an 11-member advisory body to take a portion of the funds to have some staff that will issue an RFP to the community. People will submit those. Both for-profits and non-profits are eligible to submit that. Every three years, a community needs assessment has to be done to assure that the original needs assessment is still valid, and that needs assessment then would prioritize where the greatest need would be, whether it's single-family homes or multifamily. So it could be any of it. Correct. Well, I'm going to cut to the chase because Mr. Beard has asked us to make it quick. So we're going to build what we need. So we're going to figure that through a needs assessment. So someone comes in and they're going to live there. Are they going to buy there or are they going to rent? And my guess would be that most would be renters, but purchasing is allowed. Home ownership is allowed, and incomes that were recommended by the commission go up to 100% of area median income, which is somewhere over $60,000 now. So it's not just folks at the very bottom end that will benefit. It's firemen and police. Anybody who wants to, nurses, the folks that support our community. Well, firemen and police are living in my neighborhood these days, and that is not a low-income place. So my question is, so I guess my last question is, and you start on that a little bit, is how is affordable housing different than low-income housing? Because I understand the need for low-income housing, because low-income housing is HUD programs and Section 8 housing and things that HUD supports, community ventures, corporations supports, lease to purchase programs and things like that. I'm very familiar with that concept. How does this relate to what you guys are doing? Well, I guess the best answer to that is that the Affordable Housing Trust Fund Commission recommendation was to take a broader scope, that there are folks that are struggling at a lot of different income levels. But basically you answer it from the back end, the 30%. And if this is going to be funded by the trust fund and probably managed by a nonprofit, that that nonprofit is required to charge nobody more than 30% of their gross income, and that has to be validated each year. My recommendation is for $4 million for a new tax that you all come with specifics about who's going to manage it, how the mechanism may be a proposed ordinance, something like that, but just more specifics that we can get on board. Because that's going to help us. The definition is going to give us the confidence to go out on a limb to start talking about a new tax, which is not something that anybody wants to do in this economy. I know. As I understand it, this discussion was to focus primarily on the impact study and looking at this funding mechanism. then the whole process is going to go back to the two co-chairs of the Affordable Housing Trust Fund task force, and then a final recommendation would come back which would hopefully answer, because the original commission report made very specific recommendations about how you become a member of the advisory body, what funding is allowed and not allowed, and that's all in the original commission report that was produced in 2008. I would hope, since a lot of work went into that, that that would be part of the recommendation. Actually, an ordinance was written and sent through legal to accompany a funding source. So that stuff is out there already, but as Councilman Ford said, it's not written in stone. It's got to come back, and everybody has got to be comfortable. The members of the advisory board are recommended by the mayor and approved by the council. That's a recommendation of the commission. So there's a lot of detail in there. I can certainly send you a copy of the original commission recommendation, and it's up to the co-chairs of the task force whether that recommendation passes through the council along with the funding source. Thank you, Council Member Martin. Again, short and sweet, please, from whoever needs to speak next. Council Member Myers. Thank you, Mr. Chair. I'll try to be fast. The first thing I want to say is that every resident of Lexington Faye County deserves to live in safe, clean, affordable housing. That being said, you mentioned earlier, Mr. Christensen, that there was a percentage that you gave, and you said that no citizen in Lexington should have to pay X percentage of their income for housing. 30 percent. That's the recommendation of the housing and urban development. as safe as affordable housing. Okay. Council Member Kay, I think, brought up some statistics about the Housing Authority and how they had 11,000 on wait lists. 11,000. 11,000, I'm sorry. You need to recognize that they keep closing that list because at some point the list gets so big, they just say it's silly to have people sign up and have the unreasonable expectation that they're going to get anything from signing up. Sure. My question was going to be, has anybody asked them to create a plan or do they have a plan to grow their housing? I know they bought a new housing complex, apartment complex in my district a few years ago and renovated that to increase their housing stock. Do they have a plan on the horizon to increase their housing stock? Actually, over the last 30 years, the budget for the type of stuff that our local housing authority does has been reduced by the federal government by about 80%. So keeping that in mind in terms of our lack of federal commitment to support local housing, they are very good, our housing authority happens to be very good at going after money, and they've had two HOPE6 projects that have fundamentally changed certain areas. However, right now their total capacity meets about 20% of the need. So this is, as Councilman Ford said, this is one more effort to try to deal with an issue. Yes, sir. I'm going to try to keep you brief because I'm going to ask you to keep you brief. Try to keep me brief is very difficult. Okay. And me too. But my question was, and you didn't really speak to it, do they have a plan or has anybody asked them? They were on the original commission and made their recommendations through the commission, but other than their usual efforts to try to get additional resources whenever they're made available at the federal level, I don't know of any specific plan. And they're certainly in support of the affordable housing. I understand that. But like I said, they bought a housing complex in my district and rehabbed that for their purposes. So I'll ask them that question if they have plenty of that. Because we want to address that waiting list. The next couple things I'll say is that when people are coming up with a list of questions that we need to take moving forward, I guess one of the questions I would ask is really what's the role in government in redistributing wealth, really, because that's what we're doing. We're saying that we're going to take from some people because they have maybe housing at 20 percent of their income, and we're going to take some of their wealth and give it to somebody else to even out that number. So I guess that's really a question that we need to ask the citizens of this community is what's the role in government to do that? Because if we do it, we're taking that money from people and making that happen, whether the community is saying this is what we want to do. So I would actually support what I remember. I would agree with the first statement that what's important here is to decide the role of government, whether or not we want to have the private sector try to do it solely without any assistance for the government. I would hardly disagree with redistribution because everybody who owns a car and pays insurance, everybody who owns a home or even has renter's insurance. So redistribution, I perceive of, is taking from the top and redistributing it further down the food chain. The recommendation here is much broader than that. I would, okay, we can get into that later if this moves forward, but if you take from me and give it to somebody else, you're redistributing, either way it goes. Maybe not as high a level as some people would want to, but it's still that. So that would be my question is. Then that diffuses the role of government. If government can't charge taxes and do things for the benefit of the community, then there is no role for government. Okay, let me back into it a different way. This government has a charter that says these are the things that this government is responsible for doing. I don't think housing is one of them. So that begs the question. We have a government. We have a charter that says these are the things that we're responsible for doing. So no one's suggesting there's no role in government for them to do anything, but this doesn't fit in our charter. And so that's why I'm saying if we're going to go to the taxpayer and say I'm going to take from you and give to somebody else to do this, then we need to ask that question, what's our role? And the best way to ask that question is to put it on a referendum and see what the taxpayers that are going to have to fit into that box have to say about it. So to try to be brief, I'll leave it at that. Thank you. Brian, thank you. Council Member McCord. Thank you. And, Mr. Christian, I want to thank you personally because, again, as Council Member Sennett said, you have obviously been a very strong champion and you articulate yourself well and you advocate your cause well. And that's not necessarily been the case or experience that some of us council members have had dealing with this issue. So I want to personally thank you for your decorum and how you handle yourself. You had mentioned earlier a little bit about the needs assessment that has to be done. Have we done that needs assessment for our community? It's a mandate that was suggested as a part of the commission report in order to make sure that what we are applying funds to is constantly updated. there's an annual report that's recommended to be produced every year to come back to council and the community and say, this is how much money was raised, this is how much money we got, this is what we did with it, here's the benefit. Well, and it goes to Council Member Stenet's point. We really don't know the need if we haven't done a needs assessment. We didn't do one as a commission, but there was a big study that was just done, a housing needs study. There's been several others that were done. That's why we didn't duplicate it. All of them said that the greatest need was at the bottom end in terms of a low-income or affordable housing. Well, I don't think anybody up here, especially me, will argue we have a need, and it's growing. Given our economy, Council Member Kay pointed out a number of realities when people can't pay for these types of things. The question is, how do we fund, and then what do we do with that? That's really the question at the end of the day for all of us up here. But I want to point out again that a tax means that we have to have somebody out there actually earning and creating and making a dollar so the government can take a portion of that and do those types of things. So we actually have to have folks out here to generate a dollar in the private sector for government to do anything, for us to even have the lights on in this building. Someone had to actually go out and make money, create a dollar. And in the economy that we're in, what we have, even you look at the federal government. The federal government has created stimulating solutions that cost us billions and billions of dollars that really probably didn't stimulate or solve much at all. And it has made it harder and harder. And the answer keeps coming back, well, government just needs to do a little bit more. We just need to give a little bit more. And, again, I'm just going to come back to the point that if this is the pressing need of our time, the pressing need of our community, and there is a hewing cry from the public, then I believe that Build is perfectly situated to carry that message, to educate the public, and I'll go on record and say I will be the person that makes the motion for a public referendum for this so that the public can have their say in this. But as for me and this council member here, I'm not in favor of raising a tax. But if everyone believes that this is the solve, this is the silver bullet, that this particular tax for this particular trust fund is the way to do it, then I would say let's put it to the public, let's sell the public. We voted for a property tax for LexTran. We voted for a property tax increase for our school system. And so the point is that it's not like Lexington hadn't stepped up and done it. I mean, a couple times. So why not? It's perfectly fine with me. So at the end of the day, Chairman, thank you for your let me speak. Thank you. Thank you. Council Member Henson. I'm sorry. I passed you, Chris. Thank you, Mr. Chair. And I'll be very brief. Council Member McCord, thank you for your sentiments. is because I believe you're raising, and I don't know if we have time to discuss it right now, perhaps if we keep this issue in the committee, is how best we move forward as a community addressing this issue. I contend that the need is there, and we have studied the need. I think that there has been plenty of housing studies done. My fear is that we're kind of spinning out as a government, as a council. We've kind of studied this issue. we studied this issue to great expense. I think now we have to decide what we're going to do if a referendum if we as a council need to call upon our constituents that we're elected to serve to help us with this issue such as we did with Lex Tran and other things I think that's worth considering because the reason I say that is because and I respect all the questions that the council has raised, but I feel that we're asking questions and questions and questions and that will eventually lead us to no level of implementation. We have to solve the funding issue first. And I'm almost tempted to raise the question of whether this council is willing and has the political will to implement the tax needed to create a trust fund. Because irregardless of the source, if we're not, by a vote of eight or more, ready to do that, then there will be no trust fund. Now, but if we need to take it to the public for a referendum, I'm okay with that as well. But I think either way, we need to make a decision on that. And, Mr. Chairman, maybe we can have that discussion in the next committee if we can keep this in committee next time. That would be fine. Okay. Vice Mayor Gordon. Thank you, Mr. Chair. Just quickly, if that is going to be part of the discussion, I'd like our law department to bring to us the mechanisms for putting on a referendum because the state gives us the power to do certain categories, and then if it's not in the category, the citizens come with signatures. If we can just ask law to include that in our next packet. Okay, I think we've gotten to the end. Do you still have something to say? I just wanted to thank everyone. I didn't think this discussion would be this intense, but we take things seriously, and I appreciate it. I appreciate the work of the task force. I appreciate David. And I was going to suggest that maybe the task force get back together, have some strategic conversation, plus keep it in committee. And I thank you, Chair, very much. Okay, thank you. If you'll take the gavel for a second, I'm going to say a couple of things. Who's your vice chair? my vice chair you'll take the gavel advice might had a vice mayor on one side first council member Henson I think that we need to reactivate the task force and and talk amongst ourselves about the feedback we've gotten from council the You know, everybody's got pet projects, and some of them are high-dollar projects. And we found the money and the will to do those. And so I think we need to give our best shot on this. I also was one in the task force meetings to say that I didn't think we'd get anywhere with a tax increase in the environment we were in. and that was two years ago I think I said that, and I maybe said it every meeting since. A referendum is a good idea if you win. If you don't win, there will never be a task force, or rather an affordable housing initiative at all. It will kill that forever until it's repealed, and that's going to be another tough job. Anyway, thank you, everybody, all of you that have been on the task force and are involved in BUILD and such. Thank you for coming. And we're ready to move on our agenda, and we've gotten something that is also a huge issue. And we'll let Kevin Natkin say it. Don't sit down, Kevin. Mr. Chair? Yes. I just want to make one really quick point, and I've been furiously trying to find it on the Hair Leader website, and maybe it was brought up earlier, but according to the recent census, 26.5% of children in Fayette County, and Fayette County live in poverty, and that's up from 14.7% in 2000. that's unacceptable in Lexington. We have failed these folks. That is a shocking number. And I think in the context of what we're talking about, that needed to be said. And I appreciate you letting me have the opportunity to say that. Thank you, and I really need to relinquish. May I have the gavel back so we can go? Toss me the gavel, if you will. Thank you. Kevin. Kevin Atkins. who's our development guru on the first floor. Thank you, Mr. Chairman. As each of you know, back at the end of March, the mayor named and put to work an Arena Arts and Entertainment District Task Force made up of about 45 people from neighborhood leaders, business leaders, and a wide array of occupations. During that time, the four committees have been extremely active, meeting, doing their fact-finding and their due diligence. So we are now getting ready to enter the public input phase of the project, and so we wanted to use this opportunity to bring the council up to date on where those activities were and what the committee has been doing and where it is headed. So we have asked one of the first official pieces of business that was done when the committee was formed was to hire Mr. Stan Harvey from Urban Collage to lead our efforts. Stan has worked on such projects as the Olympics when they were in Atlanta. He brings a lot of talent. Many of you have also seen where we hired Gary Bates to be the district designer, and Gary has been very active and is starting to lead us down that road. But we wanted Stan to come today and update you on where we are and where we are going. So, Stan, I will, in the interest of time, I'll turn it over to you. Thank you. Welcome, Stan. Thank you, Council Member Beard and the other members of council. Thank you for the opportunity. I'm sure this will be the first of many discussions we will have about the Arena Arts and Entertainment District, but I appreciate the opportunity to give you an update on what has been done and just as importantly what's coming up and what some of the upcoming opportunities both for further discussion with you all and with the public at large in Lexington. I'd also like to acknowledge two guests who are here. Kevin mentioned we have some first-class folks both locally and internationally that have been involved in this effort and will be involved going forward. Frederick Krogide, and I'm going to get it someday, is here from Oslo. and Michael Jacobs from not so far away, just on North Upper with Omni Architects. And I'll talk a little bit about the team in just a second. I will try to be brief. We've kind of started maybe. I think it's fair to say that the subject that at some level has instigated this and at some level gets the most community conversation is Ruff Arena as a prime sporting and entertainment venue. What I hope to communicate today is this is first and foremost not just about RUP. It is about economic development. So there is this common theme appropriately for this committee from your previous conversations. It's a different scale and a different effort, but this is an economic development project about what we want the city to be, about what our downtown's possibilities are, and it includes a first-class sports and entertainment venue. But this quote, I think, has been appropriate for us, even looking from the basketball perspective of former Coach Ruff and his comments about seeking opportunity and not security. A little bit on the task force. Most of you all know that local attorney Brent Rice is the chair of the task force. He's a volunteer group of 45 folks. This is the executive committee outlined here. They've put in a tremendous amount of time, over 20 meetings. Brent, also, as you know, this is a completely privately funded project, so we are also leveraging other efforts and other private investment that's happening or studies that are going on. I think the key, a lot of people have said 45-member task force. Boy, that sounds like a tough group. I think the key has been that they are organized into four working committees, and these working committees have been great, and the chairs of these have all been, have shown a lot of community commitment and leadership. There's a so-called technical advisory group, which is chaired by Bill Owen, President and CEO of the Lexington Center. As their name might imply, they kind of float across all the committees and provide technical resources, previous studies, information on what's happening at Rupp and the convention center and the Hyatt and the shops, et cetera. The planning and design committee is chaired by former Mayor Miller. They've met to kind of review previous studies, look at case studies, establish guidelines from what kind of a city building and urban design and planning perspective, and then they're physically solicited and will be helping work with the planning and design team that's been hired. Need, Use, and Benefit is headed by Will James. Will is the president of Toyota Manufacturing Kentucky. They've probably been the workhorse so far. They've had eight or nine meetings trying to define issues of need in this community that might have a home in the Arena Arts and Entertainment District. And finally, the Finance Committee, chaired by Luther Deaton, their work is really kicking up now. How do we do this? How much is it going to cost? What are the priorities? This is not going to be something that's built in the next couple years. This is a multi-year plan with multiple projects. so with that the mission statement is about this as an economic development project that elevates our downtown and therefore also the city but that just as importantly reflects the unique culture and identity of lexington i won't go into all this you'll see some of the folks who have volunteered their time on these various committees and a little bit about what they're doing need use and benefit i mentioned been looking in these four areas and i'll come back to this when I talk about their preliminary report. Finance, and then finally technical advisory. This is the overall timetable. A lot of the work that's been going on to this point has been internal deliberations of these four committees and the issuance of these preliminary reports, which are available online. Each of them are lengthy. I'm going to give you the highlights, but if you're interested, we can either provide them directly to you or you can see them on the website that I'll mention. and there are about 50 to 70-page preliminary reports from each, so I'm not going to go into all that detail. But the major highlights of the timing, the preliminary reports are finished. The next step is to have a community conversation about this district and what it can be, which we will have public workshops starting next Tuesday to talk about the vision of this district and what the potential projects are. By the end of the year, we hope to start focusing on something I know you all will be very interested in, which is some kind of structure of implementation. Organizationally, how does it happen? To piggyback on some of the previous conversation, the cost, obviously, the funding sources, and the priorities. And we hope to have a final report. It's important to mention, and Kevin has said this as well, that ultimately the task force is a community leadership that will deliver recommendations to you all. Obviously, we recognize you all are the ones who have the tough job and leadership of deciding what you think about those recommendations. We'll also be doing the same courtesy to the Lexington Center Corporation Board. So I think we see that the mayor, the council, and the Lexington Center Corporation, That's who, by January 31st, gets the benefit of these recommendations. But obviously that won't be the end of the story. That will be the beginning of discussion of implementation. I won't go into too much detail on this other than to make this fundamental point that I asked Frederick if I could appropriate something they put in their proposal, which really struck the committee and the task force. It's hard to see, but this is a map of downtown Lexington. It's a very unusual situation that we have physically in Lexington. It's a relatively small downtown core, mostly on short main, vine, and high, the four streets there and the red outline. What we have right up next to it is very, very strong historic neighborhoods. That's the strength of the city, actually. We have this built-in residential base, et cetera. But as we look towards Rupp, which sits, of course, and the Lexington Center, which sits on the west end, and the potential, One challenge is how do we expand and grow economically our downtown? And they did this in their proposal, which struck a lot of people, and so I, like I said, appropriated it. But you have the opportunity to almost double the downtown if you unlock this underutilized potential that is west of the Lexington Center and the parking lots that surround it. And that begins to make you think differently about Lexington and the downtown, where you actually have multiple centers serving this larger downtown. And the Lexington Center ironically becomes the true center, as its name would imply. So I think that's important to kind of talk about the opportunity that we're hoping to unlock economically. Zooming in more on the district, all that property that's highlighted in yellow is owned by the public sector. So it includes 46 acres around the Lexington Center. That's primarily the Cox Street lot, the Jefferson Street lot, and the High Street lot. That's a pretty phenomenal opportunity that most cities don't have. We have 46 acres, almost undeveloped, in the middle of what is becoming a thriving and expanding downtown. So that's the opportunity we want to focus on. The plan will address what would you do, what are the possibilities, and we want to have that public conversation. We also have things about how you enter it and how we use Triangle Park and we integrate that investment and amenity and program. The high street lots up there in the top, I think most would say that's probably not the highest and best use of 19 acres in the middle of our downtown. So what are the possibilities there? but also kind of some, because I think they're visually disconnected and on the other side of downtown, so to speak, on the other side of the Lexington Center, these opportunities to link to the distillery district but also to celebrate things like the Town Branch Creek, which you don't see and is part of our history but really isn't a celebrated part. But can we use that somehow? This is it exposed in the Cox Street lot before it gets tunneled under Rupp Arena and then under Vine Street. Just physically, our convention center and the appearance, and this is also a gateway to downtown. I've joked that I think most would agree, perhaps there's some need for improvement, just generally physically. But we've got inspiration all around us, and we've got a quality fabric in the city. And we've got other opportunities. It's not just those 46 acres, but there's other development or cultural opportunities that I think exist. We've spent a lot of time understanding the Lexington Center, its history, for those of you all who remember, colored seats up there. So it's had renovations and modifications over time, both to the Lexington Center, the shops, and to the convention center. So it's all one integrated facility, which is at some level both its benefit and its challenge, because it's just a big, I've said, the box is one of our big challenges. And when I say the box, I mean the Lexington Center. And that's a second challenge from all that land around it. So we have two prongs. We're both dealing with the future of the Lexington Center as a civic facility, which is multiple buildings and functions, and what can happen around it is our two-pronged challenge. And, of course, also the Lexington Center technically also includes the Lexington Opera House. I've used this just to say that issue of challenge. At some level, we have this convention center and shops and hotel and whatever that's all integrated. At some level, we also have a big box in the middle of downtown that somewhat hinders development happening on the other side of it. And you see surface parking lots and vacant land and other things. So kind of coming up with a plan for the whole area is part of this. But also mindful of the fact that we continue that Lexington pattern of historic neighborhoods that come up very close. In fact, we have five neighborhoods that we've already begun a dialogue with about impact and transition that immediately come up to the area in question. I mentioned the preliminary reports. We'll try to briefly hit them and then be able to take your questions of where we stand. One thing we did is we've made some site visits. We were fortunate that we have some relatively close. Columbus, Ohio, if you haven't been to Columbus lately, and a pretty amazing story about how they used an arena investment for their pro hockey team and the nationwide arena to unlock their former state penitentiary and industrial lands that were on the western side of downtown. 75 acres, 2 million square feet of private investment built in 11 years. A pretty amazing story of residential office and whatever, but using the instigator of the arena investment and structured parking and other things that came out of it, and that's us talking to Mayor Coleman there at the bottom. Also, we had the benefit of looking and learning a few lessons learned of how it worked and who did it and anything you would do differently. We also went to Indianapolis. I've said to the task force, I think this is in some ways a more applicable physical challenge to Lexington. Indianapolis didn't just have a big former state penitentiary where they could kind of recraft the entire thing. it was more incremental. They're building around existing historic resources or other things, and they're working within the city fabric, which I think is a little bit more like our challenge. They did it more over time. It started with an instigation that Indianapolis wanted to be the sports and entertainment capital of the United States. So most of you all know, NCAA, with Lucas Oil Stadium and the Convention Center, all these things are in one geographic vicinity, and they did that consciously because they wanted to build this sports and entertainment district. So that's us touring there. But we've also looked around the country at arenas, at convention centers, and at districts and tried to take some lessons learned, which is summarized in the case study report. That's one of the preliminary reports I mentioned was available for your all's use. But then the task force, P&D is planning and design. And I think fundamentally they have been looking at these six questions and looking at a plan that helps address what is the overall vision with the understanding that it's a vision that will be built over 20-plus years and therefore can't be locked in. It needs to set the parameters of what is absolutely essential for connections, for streets, for parks, and the public framework, but recognize that over time we want private partners to come in and build and create economic development, so it has to be a plan that's flexible. We also have a significant opportunity to expand and improve civic facilities and arts facilities in the area. We think that this is a way to better support and transition and connect those existing neighborhoods, but part of that is this public space network of streets and parks and other things, which we hope to expand. And then how do we get there and how do we achieve the vision? I won't go through all these. These are once again in the report, but there's kind of a bottom line headlines and findings and recommendations at the end of each of these reports. So it's hopefully a little bit shorthand. There's nine or ten recommendations from the committees having to do, in this case, with planning and design, with the kind of fundamental principles they learned or thought were important going forward. planning for complete streets and not just traffic, foregrounding and making this mostly about the pedestrian and how you walk around and experience this place, public space. We're going to have to look at, and it's a nice time to synergize with the Downtown Excellence Task Force because we will be looking at regulatory and how do you implement this, particularly if it's going to happen over multiple years. We've got, Lexington's fortunate, there's a lot going on around here for a city in the middle of a recession, but we want to leverage all these efforts to create an economic story and connections about Lexington. And we want to leverage the unique position of the relationship to the University of Kentucky and the other college town triangle, but also emerging economic anchors like Cheapside, Jefferson Street, et cetera. And we want to make sure that this is something that we think from the beginning about maintenance and sustainability and costs going forward. It's not just the capital investment. It's what we do going forward. NUB is the shorthand for the Need, Use, and Benefit Committee. They have been hard at work the entire summer in these four major categories of so-called need that could be established. So I guess since we've hired an architectural team, I would consider this kind of the program. So they've kind of helped define the program of building blocks that could be a part of this district and what they think the community, there's a need. Now, that might not have to be in the Rupp Arena Arts and Entertainment District. That may be somewhere else in the city or in the downtown. But these are specific things that could find a home here that we've asked the planning and design team to explore. Their fundamental recommendations are summarized as such. First off, what we learned from these case studies, what we learned, and what I think the whole instigation of this task force was, it's not about any individual facility. It's about the collective creation of a district. and we have a walkable mixed-use district, which is downtown Lexington. We need to expand and connect that, but the whole point of that should be it should be a mixed district with housing, with commercial, with retail, and with these civic and arts facilities. Secondly, we are leveraging the ongoing Lexington Convention and Visitors Bureau study, which fortuitously has been going on over the last year. As the task force and committee would say, it's the third study since 1986 that said that Lexington is underserved in terms of its convention center market potential. The specific recommendation from Need Use and Benefit Committee is to expand the convention center to 100,000 square feet of exhibit space and then corresponding meeting rooms, et cetera. Just to give you a frame of reference, that's the current convention center is 66,000 square feet. Stan? Yes. Stan? Yes. We'd like to have a little time for questions and answers. And you've got another meeting. We have a work session that starts at 3. So we're squeezed pretty much, and we do have much of what we see here on paper. So if you could just kind of wrap up real quickly if you have some big surprise for us. No surprises. So we've hired the team. They're hard at work. It includes an internationally led team by Space Group. That also includes local partners and some other international partners in terms of some landscape architects and others. They will be looking both and helping us create this district plan, a little bit on their background, which you can see, or we can provide more information. And then secondarily, we also asked, it's a so-called feasibility study. The task force wanted to make sure they had the best of the best in the country who own, operate, design, and construct arenas and convention centers. It's a very specific market of only a handful of firms that kind of specialize in this, and so we are fortunate to also have a so-called technical team that's looking at the possibilities for the existing box. So our next steps, the 18th is the first public workshop. We'll have a second workshop in November. and be looking to deliver you recommendations by the end of January. More information, updistrict.com. Thank you very much. Kevin, you're first up, I believe. Thank you, sir. Stan, thank you for giving us up that. I know some of us saw it a few weeks ago and got a lot of information from the committees. I just had a couple questions. First of all, it's an impressive list of who's who on this task force, and it's a very big task force, I understand. and some of them have met quite frequently and some have met only a couple times on each committee. But I guess my main concern is what type of fundraising has this task force raised? How much money has this task force raised, and what will be spent, obviously, other than the consultant? Brent would be the ultimate source. My understanding is that they have raised almost the entire target of $350,000. Kevin may jump in here. Mr. Member Stenet, the goal originally was $350,000. So we have raised that? And we are almost complete in that, as Chairman Rice has said. As far as the funding, the funding will all be privately funded. But will that list of who's giving money be public? It's not something we've discussed at this time. I mean, we can check for you. I would just think that in the future, I think it would be important to know who contributed toward these efforts, because obviously there are people that have interest in and around this area. Yeah, I'm sorry. And many of the people who have contributed, you saw their name on the PowerPoint. It's many of the people involved as time has gone by with the task force. Okay. And then the feasibility study you mentioned, Stan, this task force will do its own feasibility study. I know we're doing one right now, about $500,000 worth for the distillery district. So will you all incorporate that one as well? Are you waiting for that report? I know there's a couple other plans that have gone on simultaneously. Yeah, it's a good question because of that two-pronged issue of looking at the box and then looking at the district. The technical feasibility study team will technically just be an input into the overall plan because there is interdependence of that. But their specific focus will be wrapped up in the next 30 days, which was we asked them to come in, work very specifically with the University of Kentucky, the Kentucky High School Athletic Association, and the Lexington Center Corporation on the box and how it's working and what are the possibilities for renovation or expansion of all those facilities collectively. And that's what will be entailed. So not the district itself, but just the box. Not the district, okay. And ultimately, Frederick and the rest of the team will have to incorporate that and have the public conversation because inevitably this is, of course, about tradeoffs and synergy. So, you know, what we do with the Lexington Center itself also affects, you know, the physical plan of what we're going to do with the whole district, of course. I know we're short on time. I would just say that it's an impressive effort to do something like this, to create a task force to look at this area. But we just had a very frank discussion on affordable housing. Can you imagine this effort, Council Member Ford and those who have been pushing this, Council Member Henson, on affordable housing if we took this same effort? Pretty impressive. Thank you, sir. Any other questions? Well, again, thank you all very much. We'll get a chance to adjourn maybe for a few minutes before the next meeting. Welcome to you all, too, by the way. Second. All in favor? Nobody's in favor. Bye. Thank you.