# Budget & Finance Committee - August 26, 2008 > Auto-transcribed civic record · Committee · August 26, 2008 - **Permalink**: https://meetings.lexingtonky.news/meeting/577 - **Source video**: https://lfucg.granicus.com/player/clip/577?view_id=14&redirect=true - **Date**: 2008-08-26 - **Body**: Committee - **Last revised**: March 2, 2026 - **Length**: 16,863 words > ⚠️ **Auto-generated content.** Audio from the official Granicus video was auto-transcribed by OpenAI Whisper-1. Structured facts were extracted with GPT-4o; the narrative summary was written by Anthropic Claude Sonnet. Speaker labels and verbatim wording may contain errors. See [methodology](https://meetings.lexingtonky.news/about/methodology) or [report a correction](mailto:editor@lexingtonky.news). --- ## Meeting Overview The Budget and Finance Committee convened on August 26, 2008, at 1:00 PM with Dr. Stevens presiding as the meeting chair. The committee addressed three informational agenda items during the session, focusing on financial reporting and strategic planning matters. The meeting included presentations on the Revenue Report for June and July 2008, updates on the Facility Master Plan's next steps, and a summary report from the Mayor's AHTF Commission. One formal vote was taken during the proceedings, while no public comments were heard at this meeting. All three agenda items were handled as informational presentations rather than action items requiring committee decisions. ## Attendance The Committee meeting on August 26, 2008 had full attendance with all members present. **Present:** • Dr. Stevens • Jim Gray • Linda Gorton • Chuck Ellinger • Jay McCord • Ed Lane • Kevin Stinnett • George Myers • Andrea James • Don Blevins **Absent:** None **Late:** None All ten committee members were in attendance for the meeting, ensuring full participation in the proceedings. ## Votes and Decisions The committee took one formal vote during the August 26, 2008 meeting. **Motion to Request Downtown Presentation** CM Blevins made a motion to request the administration arrange a presentation by Clete Benken at the next work session on September 9th to discuss downtown possibilities. The motion was seconded by CM McChord and passed unanimously. The vote demonstrates the committee's interest in exploring downtown development opportunities and their desire to hear from Clete Benken on this topic during their upcoming work session. ## Contested Items The Committee meeting on August 26, 2008, featured one significant contested item that generated heated discussion among members. **Location of New Government Center** The primary point of contention centered on whether to proceed with issuing a Request for Proposals (RFP) for a new government center without first finalizing the specific location for the facility. Committee members engaged in a heated discussion regarding this procedural and strategic decision. The disagreement focused on the potential impact that proceeding with the RFP process could have on downtown development initiatives. Some members expressed concerns about moving forward with soliciting proposals before establishing a definitive location, while others appeared to favor advancing the RFP process despite the unresolved location question. The discussion highlighted the tension between maintaining momentum on the government center project and ensuring that location decisions were properly coordinated with broader downtown development planning efforts. Committee members debated whether delaying the RFP until location issues were resolved would be more prudent than potentially having to modify or restart the proposal process later. The specific outcome of this contested discussion was not clearly documented in the available materials, though the heated nature of the debate suggests there were strongly held positions on both sides of the issue. The disagreement underscored the complexity of coordinating major public facility planning with ongoing urban development strategies. ## Revenue Report for the Month of June & July, 2008 Commissioner Koch presented the revenue report covering the months of June and July 2008 to the Committee. The report provided an overview of the organization's financial performance during this two-month period. The key highlight of the presentation was the unaudited carry forward amount, which totaled $4.1 million. This figure significantly exceeded the budgeted carry forward of $1.4 million, representing a positive variance of $2.7 million above projections. Commissioner Koch delivered this report as an informational presentation to keep Committee members updated on the current financial status. The substantial difference between the actual and budgeted carry forward amounts suggests stronger than anticipated revenue performance or lower than expected expenditures during the reporting period. This agenda item served as a routine financial update, allowing Committee members to stay informed about the organization's fiscal health and performance relative to budget expectations for the summer months of 2008. ## Next Steps for the Facility Master Plan Commissioner Cole led a discussion on the Facility Master Plan during the August 26, 2008 committee meeting. The presentation focused on potential developments for county facilities, with particular emphasis on the possibility of constructing a new government center. The discussion covered various cost scenarios and planning considerations associated with the proposed facility improvements. Commissioner Cole outlined different approaches the county could take in moving forward with the master plan, though specific dollar amounts and timeline details were not provided in the available meeting materials. The agenda item was structured as an informational discussion rather than requiring formal action from the committee. This suggests the presentation was intended to update committee members on the current status of facility planning efforts and to gather input on potential next steps. The facility master plan discussion represents part of the county's ongoing efforts to evaluate and improve its physical infrastructure to better serve residents and county operations. The consideration of a new government center indicates the county is exploring significant capital improvements to its administrative facilities. No formal decisions were made during this agenda item, as it was designated as informational in nature. The discussion served to keep committee members informed about facility planning progress and to facilitate continued dialogue about the county's long-term infrastructure needs. *Note: Specific transcript timestamps are not available for this agenda item.* ## Mayor's AHTF Commission, Summary Report David Christiansen presented the Affordable Housing Trust Fund (AHTF) Commission's summary report to the committee during this informational agenda item. The presentation focused on the critical need for affordable housing in the community and outlined the commission's proposed funding mechanism. The key component of Christiansen's presentation was a proposal to increase the insurance premium tax by 1% specifically to fund affordable housing initiatives through the trust fund. This funding mechanism would provide a dedicated revenue stream to support the development and preservation of affordable housing units in the jurisdiction. Christiansen highlighted the ongoing affordable housing challenges facing the community, emphasizing the importance of establishing sustainable funding sources to address these needs. The AHTF Commission's work represents an effort to create a structured approach to affordable housing development and financing. The presentation served as an informational update to committee members on the commission's findings and recommendations. As this was a summary report, it provided committee members with an overview of the commission's work and the proposed path forward for affordable housing funding. This agenda item was designated as informational, meaning no formal action was taken by the committee. The presentation allowed committee members to receive updates on the AHTF Commission's progress and consider the proposed insurance premium tax increase as a potential funding solution for affordable housing initiatives. The report represents the culmination of the Mayor's AHTF Commission's work in analyzing affordable housing needs and developing funding recommendations for the community's consideration. --- ## Decisions - **Motion** — passed (0-0): Request the administration to arrange a presentation by Clete Benken at the next work session on September 9th to discuss the downtown possibilities. --- ## Full transcript We have a busy docket today so we must move with dispatch. And the first item will be a report by the finance department. Commissioner Cole will tell us about how June ended up and what's happened in July. Please proceed. Thanks. We do have preliminary numbers for fiscal year ended June 30, 2008. Understand that our numbers have not yet been audited. We have turned almost everything over to the auditors at this point. We are on schedule to be way ahead of last year and actually I think that we have a schedule that's more aggressive than you've ever seen in LFUCG before. So we hope by the end of September that the auditors will have finished their work. So that will be good news. Unaudited, we were, we had budgeted a carry forward in the general fund of 1.4 million and the unaudited number is 4.1 million. So we are a little ahead of the game starting out but clearly we have to wait for the auditors to tell us that's where we're going to end up. But it does help a little bit with some of the situations that we've been discussing and the fact that we have a really, really tight budget and so we're off on the right foot. And any questions about year end? Yes. If we have a budget carry forward that ends up being over 4 million, does that mean it would not be necessary to draw funds out of our rainy day fund that would eliminate that necessity or reduce the amount drawn out? I think when we get the final audit number, my understanding would be it would be up to the council to make a decision about changing that carry forward number and how or if that money might be spent. So we will be bringing options back to the council as soon as we have the audited number. But clearly I would think the rainy day fund would be one of the first places we would try to not go there even though we've had it budgeted. And it all depends. You know, I think mid-October we should know something about retirements and we were only budgeted to go in there if we needed payouts for retirements. If we don't get those retirements like we were counting on, we're not going to need that money anyway. So I think mid-October we're going to be well positioned to make good decisions. We are going to have an audited number and we will have a good handle on retirements and I would expect at our late October meeting that I will be bringing to you some proposals for where to go from there because we may need to regroup, but we may need to regroup in a good way. So we'll just... I don't think we'll have any lack of proposals. That is good news both about the audit, which I think this year we got one in February or March, something like that. Actually more like April. April. And also that is a comfortable fund balance to carry forward. Absolutely. Though there will be many proposals for its liquidation. I'm thrilled and I hope it holds through the audit. How about July? Okay, July you should have a handout that was put in your boxes. If anybody doesn't have it with you, I think Jerry has extra copies, don't you Jerry? Okay. This is our first attempt at monthly budgeting. We've been hearing a lot from Council Member Lane about trying to look at things on a monthly basis. If you look at the first page that says monthly budget report, the work that you see here for the July budget for revenues and expenditures is work that Jim Deaton has done to this point based on information as it resides, for the most part, in PeopleSoft. Week after next, we are going to be pulling together a broader group of people to kind of scrub this monthly budget thing a little bit more, bringing other people into it who might have a different perspective on it than Jim, and seeing where we end up. But this is where we are for now. And clearly, against a monthly budget, our revenue looks like it's strong. We're at 101% against what we would expect the budget to be. And we are at 88.6% of expenditures. We're on the right side of both of those numbers. We would like for our revenue to be more than we're anticipating and our expenditures to be less. I want to note something. If you look at the next page on the month-to-month comparison, and it actually is the same thing on the first page, but you see it more vividly on the next one. If you look at July 07 licenses and permits and July 08 licenses and permits, it looks like we're a little bit short. And really, one of our largest taxpayers' monthly payment did not hit our books until August 1. Last year, it was in July. This year, it's in August. It was a $1.5 million payment. So actually, we are ahead. If you were looking at apples-to-apples, July would have been ahead of July last year. So I think that should give you a little comfort about where we are with the numbers. So technically, even, we would be ahead overall. And then month-to-month, we're a little bit ahead. Some of the month-to-month comparison, July 07 to July 08, can be attributed to timing. The report you have in front of you is July, and July has not yet been closed. That's why it's marked draft. By the time we come back to you in August, we will be on a timely closing schedule. You can almost always expect July not to close on time because of the work that's going on on the prior year audit. But by the time we get the August report to you, we will be closing in a timely manner. So what we bring to you in August will be closed periods for July and August. So we're making progress, and I think we have a long way to go, but certainly to have everything to the auditor right now is a positive thing. And it looks like our revenue is holding at least through the first month. That's encouraging. Mr. Beard has a question. At least I have your name here. Yeah. Are we going to see any numbers for June in and of themselves? You will get the audit when it's complete, or I can give you a month of June report similar to that so we can compare June with July. I understand none of it's audited. This isn't audited either for that matter, but I'm sorry, I'm sorry I didn't hear you. The July numbers are not audited either. I'm just trying to compare June with July on some basis, understanding that everything's subject to audit. Sure. We'll prepare a June report and get it to you and have it in your boxes. Thank you. Thank you. Are there further questions concerning the reports for July? Mrs. James has a question. Thank you, Dr. Stevens. Kina, I know under operating expense that it has the detail and it says we need at least three months to really provide meaning for trending. Right. Can you, do you have just a brief explanation right now of the difference of 1.8 million? Most of that would be that we're doing a better job of encumbering money up front. A lot of the money that you appropriated in this fiscal year in operating was around a number of contracts. And if we're going to enter into a contract that's going to pay out over multiple months, we will encumber it in the first month. It shows up on these reports as already expended. So even though if you went into the system and look, it would show up in the encumbrance problem column. But for the purposes of reporting to you here, we treat it as though it's already expended because it is committed. And that would account for most of the difference there. That answers our question. Thank you. Other questions? Seeing or hearing none, we'll proceed to item number two on the docket, which is the discussion of the facilities master plan or the FM solutions report. Commissioner Cole will give us a brief rundown and then Councilman Blevins asks for the speak and we'll call on him next. Commissioner. Thank you, Councilman Stephens. In your packet was the FM solutions report, which you've seen before. What I've tried to do here is go through and summarize it to make it a little more digestible for this meeting. So let me just kind of walk through. I do have a copy of this coming for each of you. It should be here at any time. But just why a new government center? The driver is really the economics. As the report shows, we're throwing away about $668,000 a year in excess operating expenses above what an acceptable norm for these built for these downtown buildings would be based upon the FM solution studies. They've identified major maintenance that is needed and necessary for us to continue to occupy these buildings the way we're currently using them of about $29 million. Our existing assets, this building, the Phoenix building, there's a better use for them the way that they're laid out and designed and would get them back on the tax roll. FM solutions were brought in, they were selected by Council and by the administration to take a look at our downtown facilities and help us make some decisions knowing that we did have maintenance issues to contend with. They did a professional examination of LFUCG's downtown facilities. They prepared a 10-year downtown facility master plan that they presented to the Council. And they provided us with additional recommendations regarding our facilities management and what we should do to get back on the right track going forward. The process they went through was many steps, but they began with gathering the information. What are the utility costs? Who's occupying what space? What's the layout? What's the plate size of the floor plan? They did a lot of analysis with the data, looked at O&M cost as well as the functions of the building and how we're using them. Project goals were set with the steering committee and guiding principles that took a look at how important do we weigh things like the location, the perception, and the image. Site consolidations, is that important to consolidate certain functions or could they be separate? Adaptability and functionality of our facilities and the economic business factors of the environment that we're facing today. They developed, they had three separate workshops and developed scenarios based upon the input from the participants in the workshops. This was a cross-section of participants that all had varying opinions on how things should be. And from that they developed different scenarios and then they applied the economics to the resulting scenarios to see how they compared to the other alternatives as well as the do nothing, just stay in our existing buildings but make the required repairs. And they made that presentation to the steering committee and then on to the council as well. Their recommendation was scenario five, which you're familiar with. The results that came out of the FM solution study said our best option is to build a new government center rather than spend the money on our existing buildings and still have something that doesn't meet our current or future needs. They recommended that downtown is the most viable location. They told us that deferred maintenance is a longstanding issue with LFUCG and it's something that we need to deal with. And as a result, they recommended that we develop a capital renewal program for all of our facilities so that we don't end up in the same position in the future with maintenance. So why now? Well, we're currently losing over $1,800 a day in excessive O&M costs just to operate these buildings. We need to begin the major maintenance items now if we're going to stay in these buildings. And construction costs continue to go up. Timing is everything. Time is money and we need to move forward. Why downtown? Well, the interviews that FM Solutions conducted resulted in a consensus that most everyone felt that a downtown location was desired to have the mayor, the city council, and administrative functions located downtown in a central area. This allows LFUCG to participate in the revitalization of downtown efforts and it supports the downtown businesses. There was concerns that if we didn't continue to locate here, then the downtown businesses that are providing services to us would suffer. And it's a central location for our citizens. Just kind of taking a look at some of the Scenario 5 components. There was a recommendation that police headquarters, that they could be located outside of downtown, that it would provide easier access for employees. And although it was important to keep a police sector located in the downtown area, it wasn't necessary to have all the administration functions for police downtown. And if we construct a building outside of the downtown, the lower construction costs would apply for that building. The county clerk felt like the vault and the administration of the county clerk was, it would be very viable to keep it in the downtown market because that is where the audience is that uses the vault. But that we could create citizen-friendly offices outside the downtown area for our citizens to visit for their transactions that they had at the county clerk's office. So it was recommended that we lease temporary space for them while we explore long-term options, whether it's to construct buildings for them or to lease long-term space for the county clerk. That we demolish some of the old buildings. That the government center annex, the annex garage, the police headquarters, and the Phoenix garage, as part of Scenario 5, these buildings would be demolished and would be the footprint for the new government center to be built. That we construct a new government center, build a new building for the current occupants that have not been identified that would be leaving the downtown area, and to construct a parking garage to accommodate 50 percent of the employees and all customers and provide shuttling for other employees. Construct a parking garage. This garage, I know that this is something that has had a lot of discussion, and it could be built to accommodate more. It would just be more money than what the proposal is that FM Solutions is currently giving you for Scenario 5. But the benefits of limiting the garage to 50 percent of the employees is that it does allow us to promote alternative transportation and be leaders in that. We would sell the remaining facilities, the government center, SWITO, and the Phoenix building. So the next steps, which is where we are today, is that we need the council approval to move forward. We'd like to hire an experienced company to prepare the RFP. And like the RFP to include kind of two steps. First, a confirmation that Scenario 5 is the best alternative for LFUCG. And then to define the architectural services that would be needed for a new government center and garage. So that's a summary of the bigger packet that you've been given from FM Solutions. And I'd be glad to open it up for discussion and answer any questions. Okay, thank you, Commissioner Cole. On your last slide there, PowerPoint image, I don't see the name of a company there. Do you have a recommended? We're recommending FM Solutions. They're very familiar with our project now since they completed this. They would not be an interested party in bidding on the RFP itself, and it would be a nice extension of their services to hire them to prepare the RFP. So that would be our preferred consultant, rather than spend the money to bring somebody else up to speed with our current scenarios and situation. Thank you. We have three people who would like to ask questions, I presume. Would that be okay with you, Commissioner, I mean Councilman Blevins, if we do that before? Mrs. Gordon. Thank you, Dr. Stephens. Thank you for your presentation. On the components of Scenario 5, under the slide police headquarters, where it starts with locate outside downtown. On the third point, keep a police sector located in the new government center. Would that be intended to be a full police sector, like the central sector, or would it be more of a police office? Are you talking about an actual sector? I believe the recommendation was an actual sector so that we still had a police presence in the downtown area so that there was coming and going, but didn't feel a need to have all the administrative functions in the downtown area. Do you know, I'm sure, I don't mean to ask you this off the top of your head, but, and I like that idea, I just, I guess I'm wondering if you know the square footage required for the police sector part of this? I don't off the top of my head. I was just curious. We did speak with Commissioner Bennett and that was part of their plan so that the space that whatever would be required was included in the estimated space requirements for the government center and costs. Okay. I think it's a good idea to build a sector into the building, so. Yeah. The interviews that were held, everybody felt it was important to have a police presence in the downtown area, but that didn't necessarily mean you had to have all the administrative functions down here, that that could be accomplished with just having the sector itself. Okay. Okay. Thank you very much. Mr. Stennett. Thank you, Chair. Just a couple additional follow-up questions. One on the parking, obviously that's been a hot button for a lot of us to determine what the best solution is. Can you give us the cost differential? I think you have that information so everyone is aware of if we go above the 50% employee parking and customer parking, what additional costs that would incur. Based upon FM Solutions did some very nice estimates for us on all the components of each scenario that they looked at. And the difference between those two items is about $6.5 million. So to go 100% employee parking would be about $6.5 million? Would be about $6.5 million more. Okay. How much parking do we provide now for the employees? 100%? 100%. And that's assuming we keep the transit center? Yes. Right. Yes. Currently we provide 100% parking for employees. Okay. And then if we were to go the 50% route, what other location would we look at satellite shuttle parking? Have we even began to look at other off-sites? We have only explored that just sitting down and talking about it. There hasn't been any work done. There was a thought of using a couple of the large parks that would be remotely located but would have a need for additional parking facilities because that way the additional spots would be available on nights and weekends when the parks need the spots and would be available for employees during work days. So the cost in Solution 5, is that cost in there for construction? Yes. There was cost for parking lots to be constructed. Okay. And then also in the management cost, I assume the RFP for, we would be trying to find an architect to design the building? Yes. And we take bids on that through the normal process? Yeah. What we would do with the RFP would be, one, the first step we could confirm that yes, this is the pieces and the components of the government center that we want. And then the second step would be putting together all the details that then the architects would then come back and give us their vision of what all that includes from an architectural standpoint. But it would be very well defined what energy efficiency and the equipment and how the average square footage for this type of office and this type of layout. So we would define as much as we could to try to get apples to apples comparison with the architectural service bids that came back in. So I assume you're not at the stage where we'd ask the county clerk and the police chief and everyone else to come to the table, tell us what their needs are and where they want to be located. We haven't got that far yet. We haven't gotten that. We're just trying to take the next step that would ultimately lead there, but we're not there yet. And I assume, again, the TIF, have we looked at a TIF financing for this project as well? We have. And it doesn't appear that with the current projects that are being proposed that this fits with it because what we build will not go on the tax roll because it will be government. And the payroll taxes are the same payroll taxes we're already receiving so there's not an increment. Okay. Very good. Thank you, Commissioner. Mr. Beard. Thank you, Dr. Stephens. A couple of questions. You mentioned knocking down the parking structure for the Phoenix garage. How saleable is that going to make the Phoenix building with no parking to go with it? There's a good number of buildings in the downtown area that do not have parking structures that go with them. I mean, the occupants of that building would then need to make arrangements with another parking garage for the parking of their, for their use. Well, I'm not sure that there is space out there, to tell you the truth, and especially with our new policies on on-street parking. I no longer, not being allowed to meter feed. And then when you talk about the administration in this replacement building, define the administration other than the mayor's office and the council office. Would the commissioners be based here or would they be based with their various and sundry entities elsewhere? And is that going to present a problem as far as communication within the administration? Would law be here? That's one that just kind of pops into my mind is a lot of interaction with the administration. I agree with you. Some of the scenarios that they looked at did move some of those components outside of the downtown area and would have resulted in a smaller government center. But the scenario five, actually all of the components except for what was identified with the county clerk's office and the police headquarters, the administration, all of those still would be located in this building. So everyone who's here now would still be here. Now PVA now is in the Phoenix building, is it not? PVA is in the Phoenix building. And I guess we'll have to find something to do with them again. Yeah, I'll have to look and I'm not exactly sure whether they were part of this or not. Okay, thank you. I had a couple questions also, then Mrs. James had some, but I think as I recall from reading their report, they said the occupants of the Phoenix building would also be in our headquarters. Yes, they would. And the PVA is over there now. I need to look to see. That's probably accurate that it is in there, but I need to verify. They may have just looked at the LFUCG functions that are in these buildings. The other question I had is they've recommended we sell the SWITE tool building, but as I understand it, they recommended we continue to own the Kentucky and State theaters, and they are in the SWITE tool building, is that right? I'm not sure if that's considered, if the Kentucky Theater and State are separate than the SWITE tool building or if it is all one building. I didn't think to ask them that question the day they were here. They did, I mean, they assumed we would keep operating the Kentucky and State Theater. Okay, Mrs. James. Thank you, Dr. Stevens. Commissioner, I'm guessing that our general goal is to decrease operating and maintenance expenses on our buildings collectively. Do we know, based on solution number five or option number five, that we ultimately will be paying less for operating and maintenance? How do we know that the choices that we make for option five really have a positive impact on our fund, on our general fund? Well, we have to rely on the studies that are done, but scenario five, in scoping that out, we would include energy efficient alternatives, which will drive that number down. So, yes, we have every reason to believe that our operating costs will go down significantly. Is that somewhere in the data that you've given us already? Yeah, it's probably in the appendix where they've done all the details, but in just comparing it to, you know, we've got very old, inefficient equipment and building components, and when you build something new and you select energy efficient alternatives, the costs are going to go down significantly. We also are heating and cooling a lot of extra space here because of the layout of this building was not designed for office space. So when you go to the different floors and you see basically two hallways separated by a wall with offices, all that's wasted space that would not be in a new plan government center that was designed for these functions. Okay. Thank you. Following the presentation of FM Solutions at our work session several months ago, the law department forwarded us an appendix which contained some confidential information that was not for public distribution, and I think you'll find that analysis in that appendix. Are there further questions, comments? Mr. McCord. Commissioner, what is the estimated time frame of, if we were to move forward on this, how long does it take? Just to get the RFP ready to go is probably a two-month process, and then once it goes out there, then the selection is probably a couple more months, and then you're probably in design for a year would be an estimate before we would be prepared to take any buildings down and really start constructing anything. We're probably a year and a half out. I think one of the things that's really key, I know that FM Solutions met with a number of council members, but I wasn't one of them. It was just we couldn't get together and so forth, and I think it's, you know, with the master planning that we've got going on of downtown, we kind of had this window, it seems like, where we're really getting an opportunity to lay out a lot of here's what our city looks like all the way down to the sidewalks and moving utility poles and things like that, and so I think making sure whatever route we go that every council member has an opportunity to say where we think it should go, because it may not be this exact location that is optimal given some of the other things that have started to happen in and around us, but, you know, I do appreciate the assessment, and the bottom line is that everybody knows the building is leaking, and it's hemorrhaging money, but there is no good option. I think that the public also has to know, as you stated at the beginning, is that doing nothing actually costs you a whole lot of money. So just staying put costs us millions of dollars. So again, I appreciate that, and I look forward to meeting with whomever as to exact locations and things like that. Thank you, Dr. Stephen. Thank you. Thank you, Commissioner. Mr. Ellinger has some questions. Thank you, Commissioner. If we go along with the RFP, does that mean that we're going to go along with the new building, because I still have some reservations about wanting to spend the kind of money that's going to take. We've got a lot of issues with operating costs, but I'm still trying to decide if I'm for building a whole new building. If we do the RFP, does that say we're going ahead? What's the cost for that? To prepare the RFP is probably going to cost about $25,000, but no, you prepare the RFP, and then, you know, we'll be right back here again saying, okay, now we've got the RFP, we can put it on out and request architectural services, and then we can get cost estimates back at that time. So this is just the next step. At any point, the council can say no. So this is basically $25,000 to get some stuff back, some more data back to us to decide if we want to make that final push to do it. To get the documents ready to go out the door to say, okay, we want to take the next step. We want to find out what an architect would charge us and what their ideals are as to what this should look like and be. And to get all that back to us, how long of a process again would that be, probably? To put the RFP, well, probably two months to prepare it, get it on the street for probably two months, and then for them to respond back. So we're probably five, six months before we would have architectural responses back as far as what their piece of it would be and estimated cost of work. In the interim, would we have to make that determination if we're going to do a new building or we wait to that point and then just make that decision? You could stop it up to that point. I mean, until we actually put out the documents and say, well, even after you design, I mean, we could go through the whole architectural process and get the designs and be that far along and still say we don't have the money to construct and stop it. But I would, you know, really encourage everyone to consider, you know, that this is something we need to do. But yeah, there are many points along the process that the project could be stopped. Okay. Thank you. Vice Mayor Gray has some professional background that can elucidate some of these dates and times and money. I don't know, but I'll try, Doc. I think maybe it's really worthwhile to remind her, I think what Commissioner Coe is saying is that this piece of the process is not committing us really at all. What it's doing is creating a document that can then be distributed, maybe this is clear to everybody, but it can be confusing. What it's doing is hiring a consultant to create a document, the RFP itself, that would then be distributed to architectural firms, planning firms, whoever might be interested in it, in the project. And then a decision would be made on that. My imagination on this project, if I'm thinking it through, is that, you know, the level of interest and attention in it is going to be pretty much off the charts. So the level of engagement, the level of skill sets, the collaborative skill sets, leadership in that role by a firm that might be selected is going, the level of expectations of that firm will be very high, and it will take at least six months to a year to develop the documents that would define the scope, the project, you know, actually get down to the design of the building, because there's just a lot of moving parts to this, and being cautious about taking, you know, the two steps forward so that we don't take three steps back is what I would recommend here, but I do think my own, my sense about this is that this step is an okay step for us to take, and that we've got plenty of opportunities, we'll be asking the same questions we've asked today probably four, five, six times as we go, as we would proceed down this path over the next six months to a year. Is that a fair statement, Kima, have I? Yeah. I mean it. Yeah. I think it can be a little confusing that we are actually today putting an RFP out on the street, and we're not doing that through this. All we're doing is creating the RFP. That's correct. Right. Thank you. Thank you very much. I think that helps clarify the situation. Is there any other comment regarding this? Thank you, Commissioner Cole. Council Member Don Blevins has a proposition for us. Thank you, Dr. Stephens. Thank you, Commissioner Cole. It was a good presentation. I think it's well established that we're going to need to leave this building. If you look through the FM Solutions report that we have in front of us, they show comparisons with national numbers, and this building in particular is way out of line in terms of stipulating expenses, so I would argue that it's well established we need to leave this building. I think it's also well established we probably need to do that expeditiously. What's not as well established, in my opinion, is where do we go? So what I would like to do is offer a way to decide that as a community so that we can guide wherever the RFP selection needs to go in terms of a location for the future government center. I'd like to point out to us that we are facing a 50 to 100 year decision here. This is a government center that's going to last for quite some time. The decision we're also making will obviously impact the downtown area for 50 to 100, perhaps even longer years. So I'm feeling the weight of that decision and not feeling necessarily that it's a good thing for us to rush into a particular location decision. The next thing I would point out, since the FM Solutions Study, the landscape downtown has changed substantially. We have a whole block that's level. The Centerpoint development wasn't even publicized at the point of the FM Solutions Study, and I'm certain that they were unaware that it was going to occur. Secondly, if these two properties come available, this one that we're in today and the Annex building, I'd just ask you to think for a minute, just daydream for a minute, what could happen with those two properties if they were sold by the government and were opened up for development of some other type. So that opens up this property, the Annex property, possibly even the Phoenix property, as well as what the webs are doing on that block over there, and you've got a true transformation possibility in the downtown area. I'm not saying that's what we ought to do, I'm just saying that's an opportunity that we have here for once in every 100 years. It's an opportunity for us to think about it. Third, there's some other non-downtown locations that have been thrown about, and I'm not advocating any of these, I'm just throwing them out for discussion purposes so you all can think about it with me. For example, the latest proposal through UK about building a new basketball arena, if that were to occur, then Lexington Center suddenly opens up. Is that an opportunity for us to use that area or space for a government center? I'm just thinking out loud. Another possibility that's thrown out in my family dinners, I won't name names, is Lexington Mall. I get this a lot at home. Those are two locations that we might consider just as a thought experiment for where the government center could be located. Or perhaps you feel that it's very important that the government be located downtown. That's an equally supported position, but what I think we need to do is have the conversation and decide as a community which way we want to go. Finally, Commissioner Cole referred to some interviews that occurred with the FM Solutions folks when they were in town. I just want to point out to us that those were good interviews, I'm not downplaying, but did not include the full council when they were interviewed, as well as it did not include public input. So what we have is a consultant that came in without all the information they needed, has made a good recommendation to get out of this building, offered a possible destination for us, but I think we've got a little bit more work to do. So to get to that point, I'm going to offer a suggestion. What you have before you is a resolution that's just meant for discussion purposes. And I guess I would offer this as a possibility. We as a committee could vote to put this into a work session so that we would discuss it as a full council, it would allow for public input, and then we would make a decision as a council based on that input and based on our own thoughts, and that would give direction to us as a community as to where we want to locate the government center, and then this process can move on from there. So let me stop yakking and let you guys talk. What I'm interested in hearing is your thoughts on how we should go about choosing a location, and if this is a vehicle that you would like to see happen. Thank you, Dr. Stephens. Thank you, Mr. Blevins. Who would like to speak first? Mr. Gray. Yeah, I think Council Member Blevins has got really good points in that. And my sense would be that we could do almost everything that you described just now, that examination process, with a good firm leading it. And that to get to the point that we have the stewardship, the leadership, the skill sets at the table guiding just what you described, we need professionals who are accustomed to examining those issues. I agree with you. I agree that we've got almost the canvas is a big canvas right now, and there are lots of options. And the language in one of those bullet points was important, at least to me, it said confirm. And I wouldn't necessarily put confirm location or option five, but FM Solutions are principally a financially driven firm, so they're very technical as it relates to examining the cost of operations, and that's what they did. They didn't get into space planning. They did say, okay, hypothetically we'd go to these, we've got these options. But now drilling down into that is what you're talking about, drilling down into those options and confirming best solution, that's what I'm hearing you say, right? And for us to get that step taken, I believe we need some leadership in it, some experts, those who have got the skill sets to do it. That's my sense of it. If I may respond, Dr. Stephens, I agree with what you just said, and maybe I'm still misunderstanding what Commissioner Cole and the administration are proposing, but it seems to me that scenario five does identify, assumes a location, and that's why I want to step back up. If the location is still on the table to be discussed, I'm willing to move forward, but I didn't get that sentence. The question I would have would be whether we could include in the RFP the location, if that would be possible. Of course, the council could decide they want it downtown, but don't know where downtown they want to put it, or they could put it any place in the urban service area. Yes, Mr. Burkett. I think we have to think of this more than we would think of, and I know we do, I'm just trying to put it in the context, I think we have to consider this process more than just like going out and building a building, and I think that's what you're saying. This is a 100-year decision, and we can't treat it like a project that comes along every two years. So doing this piece well, an almost overkill may be required, so that we don't take two steps forward and three steps back. So I would agree that we don't need to identify the location as fixed today, but we get the best we can get to the table to examine the next 100-year project for our downtown, which is the downtown. Take that, take option five, we can say, you know, let's remove option five as the selected identified site, but let's proceed with an RFP and craft the RFP. Thank you. Mr. Beard. Thank you, Dr. Stephens. How did you know I was going to ask you a question? To create an RFP, we have to have some vision in our mind about what we're talking about. It can't be done in a vacuum, obviously. Are there any places that we need to visit, either electronically or physically, that have done a good job with government centers? And I'm excluding the copper-clad one that we saw a few months ago in Austin, but maybe the interior might tell us some things, but to create efficiencies, how, if it's designed, this was designed as a hotel, obviously, and we've made do and retrofitted and done some other things. But if we're starting from scratch, knowing it's a government center, it's going to look a lot different, I would think, and maybe some other people have gone through this process and could give us some help. Where exactly we go and how we determine who they are and such is going to be your job. Not ours, necessarily, but have you given any thought to that? Yes, Councilman Beard, I'm sorry. What you're referring to would be part of that architect's job, would be what does it look like? What does it feel like? How do the spaces look? That would be part of the architect in their design process to give us our viable options with design and would solicit public input and all of our input on how do we want our government center to be. So that would be part of the architect's process that they go through. Now, what Councilman Blevins and Vice Mayor Gray are talking about is really an RFP for something different than what the administration has been talking about. It's taking a step backwards instead of saying that we're at this point. It's taking a step backwards and saying, okay, let's go revisit that. Where do we want it? FM Solutions has made a recommendation on what they feel the most viable option is, but if we want to step back and revisit that, then we're really talking about hiring somebody to take us through that process and include public input as part of it. All of that really is prior to the point of where we were looking at FM Solutions taking it next. When we say to revisit it, it is revisiting it, but you're really starting over in some aspects of when you say, do we even want it downtown? If we want to go back and revisit that, that's a whole other process. Now, I think the Council does need to put some parameters on this. It will be very expensive and time consuming to hire someone to just explore what are all the options out here for us. We need to set some parameters for them or it will be a very lengthy process and we will be stuck with making the major maintenance items on these buildings before we ever get to building a building. I think, yes, your question, we can look and give you some examples of some communities that have done a nice new government center, but that really falls into the next step. Okay. I just don't want to get into a situation where six years from now or five years from now we want to say, oh, shucks, you know, like we forgot this or forgot to put the roof on or whatever. Yeah. No. And I think that part of the RFP process of when we hire an architect would be for them to provide us with examples of what they've done and done a good job so we'll get a lot of really good ideas from the process alone. Again, there might be some information online that would help us also, at least point us in some directions. Yes. And I'll explore that and get back with you. Thank you. Mr. Lane, then Mrs. James, and Mr. McCord. Thank you, Mr. Chairman. Listening to the presentation today, a couple of thoughts ran into my mind regarding all the work that we have proposed in downtown. I just made a quick checklist. We have the downtown master plan that's being relooked at, the rep arena and perhaps new arena project's been discussed, the city hall, what we're talking about today, then Center Point obviously is another development. We have the TIF proposal that's pending, which would include the linear park and a parking garage and maybe renovating the old courthouse, and then the streetscape program, which shows all new streetscapes and landscaping and having gateways into the east and west sides of town. Newtown Pike extension, which is going to renovate a lot of the west part of town and change the road patterns over to UK, and then the distillery project. And that's a lot of things happening all at one time. I'm concerned that there needs to be some coordination among all these projects. For example, we could put in a streetscape and then somebody's going to build a building and we have to tear it out for construction purposes. So I think maybe in this process it would be worthwhile maybe to go back to the master plan for downtown and try to take these new ideas and incorporate them into the overall master plan, and then we would have some of an overlay of all these projects consolidated into one effort. The other aspect is, of course, the cost. And I know the streetscape program could go up to $60 or $70 million for that project, and I think just the incremental startup of that was like $20 million. So we've got, that is just one example, and of course the City Hall is another cost. We have a lot of cost, and we are at the same time working on the Emergency Operations Center, which is another major capital expenditure out of the downtown area. So I just want to throw this out for everybody to think about. It's a little bit, it's exciting, but it's also sort of scary. Thank you. Thank you, Mr. Lane. Mr. McCord. And to piggyback off that, Council Member Lane, the zone change we heard a few months ago for the development behind the Herald Leader and Belcourt, the project that's going to happen across from Main and Rose and the parking garage. So that list is quite extensive, and I think that I agree 100 percent with what you're saying that you've got a lot of this type of stuff in microcosm. What we see a lot out in the suburbs is that you lay a new set of asphalt down on a road and then the next couple months all of a sudden we have to cut into that and put some sort of utility underneath that. And so if that happened first, then we could have had a nice road and everything done. And I think there does need to be some sort of overall coordination, and Vice Mayor, I was going to ask, you know, does it, from what you see and from all that is happening, does it fall back onto, because the downtown master plan, as we discussed the other day, is really more or less not really a master plan that Council Member DeCamp had said, it probably was ill named, that it was probably better to be a recommendation list of how to develop downtown more than just a document, a hard and fast document. But given that, is there opportunity to expand what CLEED is doing for us, what some of these folks are doing, and roll that into that package as the most cost effective way to coordinate all these things? Because if there's anybody that understands what's happening, it's probably CLEED and STRAND and these guys. In fact, on Friday, STRAND was awarded the Legacy Trail Project to do, which incorporates KKG and those guys in doing this. And so, does it make, am I just sort of pulling that out of thin air, but it seems like that's who's most familiar with everything that's kind of happening, and that we might be able to get some bang for our buck and not have to bring a brand new consultant on and get them up to speed. But I'm just going to have a conversation with you. That's honest. I was timid about maybe even saying it, but that's exactly what I was thinking, that, you know, these guys are already, you know, they've got a learning curve, they've demonstrated lots of competencies. If we listen to them, you know, then they'll probably help us get to the point of examining and including the community at a responsible level, at a minimum level, in getting support and buy-in for where this needs to go. You know, they've got, you're right. They've got a vision, a pretty incredible vision they've developed there. Well, and I don't think that you lose what FM Solution has done. I think that there's a tremendous amount of value to the work that's been done, to the scenarios that we're looking at, and my biggest concern is that when you start to look at Main Street, does dropping a behemoth government building, which does not draw nightlife and things like that, is this the absolute best spot to place it, or is it one block up? Is it up in the third? corridor is, you know, those are the types of things, not a starting from scratch, certainly, because I believe what we've found is some very viable numbers and something that can be rolled into this. But I think that going forward I would like to see what it would cost to roll this into a more aggressive plan, recognizing that the downtown master plan is not a guiding document, a hard and fast comprehensive plan type document, but rather more of a recommendation list. And rolling some of these other factors that have happened over the last few weeks. But given CenterPoint and all that has come out of that, the last thing you want to do is to build a government building that really is public property in the middle of downtown and not have that kind of inclusion. So those are my comments, and what I would feel very strongly about is looking at trying to roll everything Council Member Lane just said, inventorying that, and then having someone at the table that understands us as a community. Vice Mayor, I'm going to yield to you. One final just footnote to that. You know, when we're talking about the skill sets to examine these really complex issues and bring a sense of community support to a decision like this, what I've observed at least, you know, is that Cleet does have those sorts of skills. And if he couldn't help us on this project, then he would more than likely, that firm would more than likely tell us that they couldn't. And yet, Commissioner Coe, it would be a stepping back in order to confidently step forward. That's what I'm hearing. In different ways, that's what I'm hearing several of us say. That there are a lot of moving parts right now, and we need the confidence that we're making the forward step a secure step. Is that what I mean? Well, I think Council Member Blevins has offered us an opportunity to take one small step at least, and whether we want it downtown or not downtown, and that's the gist of your resolutions, I would see it. So you're next in line to tell us. Thank you, Dr. Stevens. There's a couple of things flowing in here. The first one is I'm glad we clarified that the administration is bringing a certain form of RFP, and what the Vice Mayor has been talking about is a very different form of RFP. I very much favor what the Vice Mayor is talking about. I think it's a great idea. I would disagree with Commissioner Coe in the wording that she's used about restarting and revisiting. I don't think we ever had an opportunity for public input through the FM Solutions process, so we haven't done that step yet. In a sense, it's very similar to the way the Centerpoint project was done, where there was sort of a design and we made a decision and now here we go. I think we need to back up a little and practice what we've been preaching a little bit and get some public input and some public comment on exactly how we want the downtown to go and manifest. That said, I'm not here to prolong this and delay it because I agree with what FM Solutions has told us. We've got to do something about this building and our building next door. So I guess I'm looking to your experience. What is the way forward now that we've kind of got this out on the table? I'm thinking that this resolution I have is sort of a small piece in a larger part of a play we need to make. Do we need to expand the contract of CLEAT? Or how can we make substantial or some sort of form of progress today in this committee meeting so that we don't continue to delay what I see as being inevitable? What I would do is ask the question of CLEAT that Council Member McCord suggested. We asked them if they've got the skill sets to examine this macro 30,000-foot level issues that we have and confirm then that this is going to be the kind of transformative project that's going to be good for this city for the next 100 years like Council Member Blevins suggested. I'm sorry. I didn't mean to interrupt you. Mr. Kelly? Thank you. What we intended was to, in the RF, developing the RFP, the language we used was confirm or validate the Scenario 5 recommendation that FM had brought to us. In essence, that's what we meant, what you're saying and what the Vice Mayor is saying is essentially the same thing, is that you're going to have hopefully, as the Vice Mayor said, a tremendous amount of interest on the part of people who are really good at doing this sort of thing, who would respond to the RFP and in responding that they would understand part of their role would be to, again, confirm. Is that the best place or is there another place that they think would be better for what they would envision the Government Center to look like with whatever parameters that we've included? So we're not disagreeing with you and the RFP that we envision constructing would have that component in it. We just didn't explain it or we didn't delineate it as succinctly as you have, Council Member and Vice Mayor. If it's the desire that we go back to CLEET and I will tell you also, before I say that, I will tell you that they have been, CLEET has been aware of the FM Solutions study and the recommendation and the potential for a possible new, excuse me, new Government Center. And yet he also is aware that no firm decisions have been made by the Council, knows where we are in the process. So in the streetscape portion of the work that's been done, he has factored that in to the streetscape plan. So there has been coordination, I think, and at least an awareness of the things that are going on and how they might potentially impact each other so we have some kind of a cohesive vision where we're not heading down separate tracks with competing kinds of visions. If I can, Dr. Stevens, may I comment? Yes, Mr. Gray. I think we're all coming at this from, you know, we're all trying to hit the same point, but we're probably coming at it from different experiences right now. Sure. And we want to try to avoid a buzz saw that a project like this can, under the best of circumstances, create. What Council Member McCord was saying was, you know, really important. And what Council Member Blett, I think what everybody said here today is really important. And at least from my own experience, what I would want to see and hear is someone likely confirming that, you know, this is the best direction that we can take today. And then there's more likelihood that we're going to embrace that with conviction. Did I say that? I think what you have to help us with a little bit is what the scope of what you want cleat. Well, right now I think we could just have a meeting with him and talk to him. Okay. And have him share, see whether or not, you know, we're running up and down the flagpole on issues that are not meaningful. Sure. Or they are meaningful. Okay. Yes, sir. So I'd suggest that, and we could do that quickly. Sure. Everybody here has said we don't want to hold up the train, but we want to make sure that there's no bridge out once we start it. I understand. Well, we can arrange for cleat to come perhaps to the next work session or to this committee. What is the most expeditious way? I would suggest the next work session. I believe that the committee is not going to meet again for a month unless we have a special meeting. I would appreciate that if we could do that. Is that all right? Have cleat come and you all can have a conversation. He can have a conversation with you about this issue. Is that okay? Yeah, I think it's we need to expedite the picking a location as rapidly as we can, though it does need adequate review. All right. Mr. Beard would like to speak again. Just one thing, and that, not that I have a thing against cleat or what he's proposed, but is it not wise to have a disinterested third party validate what he has done and validate what the downtown master plan is without, I mean, it would be awfully hard for cleat not to have some bias against what he's already presented to us. Like I said, I think what he's presented has taken into consideration his awareness that this project might be a project that would be undertaken. So he's knowledgeable about the government center potential of doing something other than staying here. So I don't, in my experience with cleat is he's a very straightforward, very honest thinking person, and I wouldn't have any hesitation asking him for his opinion. And you all don't have to accept his thinking. You could get another opinion if you so choose. But if he uncovers something in the process, is he going to bring that forward even though it may negate what he's already told us? I think if he felt like it was in the best interest of the community, yes, I think he would be candid with you. And if it required amending something that he had already, you know, perhaps proposed, he's shown a great deal of flexibility as he has gathered information from the community about the streetscape project. I agree we need to go through the process with someone. I just was questioning whether we wanted to go this direction or whether we wanted new eyes to look at all of it and try to pull it all together as opposed to some people. Like why not get Eric St. Groves down here again to do their third dipping into our pocket to, actually not our head pocket, that was I think the downtown master plan was funded actually in fairness by the community. We were involved in that. Yeah. So, yes, I have high regard for them as well. But, again, I think what you're asking for is a conversation that if you're uncomfortable with the way that conversation goes and feel like you need to go, you know, another direction, you'd still have that option. I would just ask that we try to. I don't know that I'd be uncomfortable with it. It's always nice to have fresh eyes to look at something sometimes. Getting a set of fresh eyes takes a lot more time. And we have an expert on the contract with us now who I think will serve a good purpose. We don't run into any bidding problems. I'm sorry, what did you say? Do we run into any bidding problems, not bidding this out? I don't think we're going to be engaging him at this point. We're just going to have a conversation relative to the work that he's done and what his thinking might be about a new government center and his thinking about how you would go about engaging the community in a broader way to get some consensus about location of the facility. Okay. That's fine. Thank you. Thank you. Thank you, Dr. Steele. Mr. Lane, I think, did you have a question for Mr. Kelly? Or a statement? I just wanted to make another short statement. And I would like our council members to walk along, and any of the viewers out there, to walk along Main Street and look at the streetscape presented by our buildings for the police and the county clerk and the garage, what it looks like from Main, walk over to Vine and look at the parking garage over there, and then if you could envision new development in there, how much better it would make our downtown look. That's the kind of issues that need to be addressed when we're doing this 30,000-foot and closer overview of where to put the new city hall. Okay. Thank you, Mr. Chairman. Thank you. It looks to me like we have two propositions here. One is the resolution which has been offered by Council Member Blevins. The second is the request from the administration to approve retaining FM solutions to draw an RFP to design and build the structure for a new city hall at the location they specified in Scenario 5. Those are not completely compatible, I don't think, and whether we can approve both I don't believe would be in the essence of Council Member Blevins' resolution. So what is the sense of the committee? What would you like to do? Mr. Blevins. Let me simplify things a bit then. I think it would be wise for us to sort of table this resolution until we hear from the, I've forgotten his name, Cleet, whoever this is, next Tuesday, because I think if we decide to go that direction, this resolution and what it's trying to do would fold right into that process naturally. So I'm more than willing to, I just wanted to start the conversation. We've done that. I'm willing to withdraw it so we can move on with other business. So a third alternative then would be for the committee to recommend and arrange for a presentation at work session next week to discuss this issue, as well as further consideration of the FM solutions. Mr. Chairman. Yes. We're not going to have a work session next week because that's the holiday week. That would be September the 9th. I'll make that motion that we do. If you would state the motion then. You just did. I would make the motion that we request the administration to arrange a presentation by Cleet at the next available work session so that we can discuss the downtown possibilities. I'll second. The motion has been made and seconded that we request the administration to arrange at the next available work session, September the 9th, a presentation, a discussion concerning the issue of location for the new government center and its relationship to downtown or other places. And that has been seconded. Is there a discussion concerning that motion? I see no request for discussion. All those in favor signify by saying aye. Aye. Opposed? I think it's pretty unanimous. Thank you. Is there any further action we need to take on docket item number two, which was next steps for the F Facility Master Plan? I think we took a step, though it may not be whatever step everybody wanted us to take. The third item on the docket is the Mayor's Affordable Housing Task Force Commission, a summary report by David Christensen, the Executive Director of Central Kentucky Housing and Homeless Initiative. It's all yours. Before I dive in here and start talking, I'd like to acknowledge all the folks that came here along with me that have been participating, some commission, most of whom were commission members, if you would all stand up here, and also acknowledge that Andrea James and Chuck Ellinger are commission members, and we're all here today to really give you a summary of the work that we've done so far on the task that was appointed, given to us by the Mayor. Have we got the PowerPoint loaded up here, anybody? Going once. Does anybody know whether it's? Expert technician. Oh, okay. I thought you were. We've got it in writing here, so we'll just use the written documents. Okay. It starts on page 47 here. First of all, a real quick background here. There are several different efforts that have been happening here in Lexington. The Social Service Commissioner's Needs Assessment, as well as the Central Kentucky Housing and Homeless Initiative, has been working on a ten-year plan in conjunction with the Division of Community Development to end homelessness. The council, you all in the council, have been working on an infill and redevelopment document, and a community effort organized by BUILD, did a lot of research in the community, and all four of these entities have expressed the need, highlighted the need in our community for affordable housing. In response to that, the Mayor appointed a 47-member commission body to look at the issue of affordable housing in our community, and to come back with recommendations to the Mayor by the first part of September. The second commitment that he made to the community was that the report would be translated into ordinance language, and an ordinance would be submitted to the council for your all consideration. And the third part of the commitment was that some form of affordable housing trust fund would be created in our town, and operational by July of 2009. The purpose of us being here today really is to share with you, we've been at this for about three or four months, and our purpose today is not to request anything from you, but just to update members of the council on the progress that we've made, and basically summarize the report that we're going to be publishing and giving to the Mayor next week. On page 49, there's four or five slides in here that talk about documenting the need. One of the things that has struck a lot of us is the number of people who are spending an enormous amount of their gross income to put a roof over their head. In particular, there's 18% of renter households in Lexington, and that represents 8,753 households are spending more than 50% of their gross income putting a roof over their head. And that, I think, is one of the most striking things that has impacted us in terms of documenting the need. The other thing that we discovered was that rents, and typically when you look at this thing, people do statistical analysis on two-bedroom rents. The two-bedroom rent in Lexington has spiked since 2005. It seemed to maintain, looking at page 51, the rents were averaging about 1.8% per year in the first half of this decade, and are averaging at this point 6.5% in the second half of the decade. So the problem appears to be getting worse and accelerating. I jumped past 50. 50 just talks about the comparison that rents are, at this point, appear to be exceeding incomes by a factor of two. In other words, the percentage increase, average increase in rents is going up about twice the rate that our wages are going up. So another documentation that the situation is getting worse. On the next, pretty soon I can switch over there and start looking at the board here. On page 52, most of the research that's been done and that we've been doing for the 10-year plan indicates a close correlation between homelessness and affordable housing, the lack of affordable housing in a community. Right now, at the last count that was done in January of 2008, there's 1,250 homeless individuals and families living in shelter programs and approximately 200 folks that are literally on the street. The next slide really makes the point that a lot of times individuals will say, well, why do we have to do anything as a community? It's important to recognize that there are more than 600 communities around the country that have already established affordable housing trust funds. One of the biggest factors involved here is the fact that the federal government, over a pretty long period of time, the last 25 years, has really abandoned a strong commitment to affordable housing, as indicated by the more than 80% drop in the funding that's allocated by HUD to affordable housing. Next one. Who's making this happen? I'm having trouble switching these pages backwards and forward. We can skip through proposed. A real quick summary here so we'll have some time for questions. What we're proposing in this document is the creation of an affordable housing trust fund here in Lexington that will have the following purpose, to provide our community with an ongoing public commitment to expanding the supply of safe and affordable permanent housing in Lexington-Fayette County. Affordable, okay. A lot of times there's discussion about what is affordable housing. We're defining, basically this is HUD's definition of affordable housing, that a unit of housing is affordable to the family that's in it if they are not spending more than 30% of their income for housing, and the housing-related costs here are basically utilities. And that we are going to recommend that that definition be used in the ordinance so that people then could use that to determine who's eligible for the funding. We're also suggesting that a broad range of entities are eligible to build affordable housing. This would include non-profit, for-profit units of the local government and public housing authority. Basically the reason for this is that there's a lot of work that needs to be done, and anybody who is willing to build and operate affordable housing with funding from the affordable housing trust fund, and we're certainly hopeful that they'll dive in and compete under RFP processes. One of the other determinations that was made is to have a relatively broad utilization of the money so that the primary focus, of course, would be affordable housing. We also want to make funding available for long-sustaining of permanent housing over the long term, and some funding available for emergency and transitional housing that's leading in helping families get into permanent housing. The next, if I'm flipping these pages right here, the targeted, this we spent a lot of time and discussion on. Basically this formula, it's a little bit confusing when you look at it in this context. Maybe we can jump, I think there's a chart in here on the next one. Is there not, Sarah? Yes. What this basically does, if you look at it in terms of the pie, is that the majority of the funding is targeted where the greatest need is, which is 30% of area median income and 50% of area median income, but also there is funding available to a pretty broad spectrum here, to folks all the way from renters and folks that are struggling with homelessness and trying to get into a place, all the way to first-time homebuyers. And we felt that that was important if we were going to be looking for funding from across the community that all sectors of the community could at least share in some of the benefit from the Affordable Housing Trust Fund, but recognizing where the greatest need is in the lower income categories. That's why we've selected this to recommend to the mayor. 62. There's a listing here of other considerations in terms of that rental assistance would only go to the very lowest AMI, that funding would be non-supplantive, and that this pot of money would not be used to sustain existing projects. We're looking to expand and address the lack of affordable housing. Differences in terms of how nonprofits and for-profits could apply for money, an indication that we want to reassess the need at least every three years so that we can always be a current, some administrative limitations set in there, all of which we're recommending as a part of how the fund would be utilized. Okay, administration. We're proposing that an 11-member governing board be created that's appointed by the mayor and approved by the council, and this 11-member body basically has the authority to issue RFPs, to review and rank those, and then designate who receives the funding for the various projects. The actual administration would be going through an administrative agent that would be selected by the governing board, also the creation of a technical advisory group to help assist organizations to put together competitive proposals. The next page or slide has a listing of the types of skill sets that we're recommending exist on the governing board. We have a pretty broad representation of skill sets on the commission now, and the larger group felt that all of these skill sets, for-profit, nonprofit, service-oriented, construction, et cetera, et cetera, would be very important to have on a governing board. The next few slides list the various activities of the governing board. We don't really have to necessarily go through all of those individually, but it really divides up the responsibilities of the governing board, the administrative body, and the technical advisory group. I think probably from a structural standpoint, we were very concerned, excuse me, about making sure that the governing board had real authority. So basically the money decisions flow through the board so that they're making real decisions. The administrative agent, we wanted very much to be associated with the types of activities that are typically involved in this. The best entity that we can think of at this moment is the Division of Community Development because they're working with CDBG and home funding now and are very familiar with these types of projects. The funding, we wanted to be companion funding in order to bring in resources into the community so that the skill set that's necessary to properly administer and dispense with this funding is an important consideration in terms of selecting the administrative agent. But the power of the recommendation we're making here is that the governing board is really going to be the entity that's making decisions, and the administrative agent is going to be the body that's going to carry out the day-to-day activity. We're also recommending that some staffing allocation, administrative allocation, go from the Affordable Housing Trust Fund but limited. On the slide, it's on page 73 here, looking at funding. This was, I think the subcommittee that worked on this spent an enormous amount of time and evaluated upwards of 25 or 30 different options of ways to come up with money for this, and it was some pretty interesting discussion. I'm sure you all have interesting discussions when you're trying to come up with targeted public funding sources. Ultimately, we did make the decision that our funding preference was to have a community-wide funding source that cost a little bit to everybody instead of a lot to certain targeted market sectors. And the winner was the recommendation that's coming out of the report is going to indicate that we're going to end up asking the council to add 1% to the existing insurance premium tax in Fayette County, which is currently at 6%, and allocating that 1% increase to funding the Affordable Housing Trust Fund each year. The projections of the revenues here are about $4 million a year that would fund the Affordable Housing Trust Fund. The 1% costs an individual or a family $6 on a $600 homeowner bill. We did some further research. The average homeowner insurance bill is somewhere around $750. The premium would be most hit folks in terms of their automobile insurance and their homeowners insurance. It would probably cost, on average, for somebody who owned a home and insured it and owned one or two automobiles, maybe $12 to $15 a year per household. This insurance premium is not currently leveled on health insurance. The next section here, if I may, is once it's up and running, there are some other recommendations coming out of the commission. There were some other ideas that we really liked for funding, but these didn't make the grade in terms of an initial request, primarily because all of these options take time. The blighted property tax levies would probably take the better part of three years to get up and running and be able to generate resources. There are some side benefits to that in terms of moving property forward and having it better used in our community. Typically, this last one here, increase the real estate transfer tax, that's one of the methodologies that a good many Affordable Housing Trust Funds use, but it requires state legislative changes, and we were estimating that to be successful with that, it might take, again, two or three years to make that happen. And the portion of the surplus funds coming from the county clerk's office isn't a dedicated source, and it doesn't occur every year, and there may not be a surplus. But, of course, we would not hesitate to accept money from that funding source should it become available. The last couple of slides, or last couple of pages here, talks about the, trying to take a look at this potentially $4 million going into the community and the benefits that can come from it. Typically, Affordable Housing Trust Funds parlay matching resources that come into the community, and the national average is actually 7 to 1. We used a more conservative number of 6 to 1 that tends to be the average that's experienced by the Kentucky Housing Corporation. And if all this $4 million was spent on new affordable housing, this would generate somewhere in the neighborhood of 336 units. It could also rehab 1,400 existing units. On the next page, we translated that into employment impact. We could create 448 jobs in year one and have ongoing jobs of up to 176. On the 6 to 1 ratio, it's going to generate approximately $24 million worth of revenue coming into the community to match the $4 million that we would be putting up from other funding sources. So, in a lot of ways, even though we tend to blanch at the idea of taxes and tax increases, this can be looked at much more as an investment in the community. Because by investing money, we're bringing much more money into the community in terms of jobs and other resources. I think there's one more slide on this that really talks about the cost of doing nothing. There hasn't been a lot of work done on this, but Lee County, Florida did a pretty extensive study, and their population is a little bit bigger than ours, but they estimated by not addressing their affordable housing need that it was costing their community as a whole, somewhere in the neighborhood of $249 million. If you do some real quick extrapolation, since our population is 60% of theirs, we could say that it's only costing our community $149 million each year to ignore it. I have a copy of the study, and I could give it to everybody. The comparisons aren't exact because the recommendations and the use of the money in their community was a little bit different than the recommendations we're making, so I'm not sure you can go dollar for dollar and say that we can sign it in blood. But it's real clear, after you look at this study and the way they added it together, that it does really inhibit growth and reduce the amount of money that's circulating in the community, and it costs your community money to ignore a real dire need for affordable housing. Now, are there any questions? We've got the team back here prepared possibly to answer some questions, and I'm more than happy to answer questions too. I'm sure there will be questions, and the first is going to be asked by Mr. Stennett. Thank you so much for bringing this to us today. This has been a much, well, long-awaited and well-needed presentation to this body. I just had a couple questions on the program's logistics. I assume that, you know, as someone who applies for funding through the trust fund, how do we take into account the other funding sources that are already in place, such as Section 8 and welfare? Do they become the primary source and this a secondary source to pay that monthly renter payment or house payment? How do we coordinate with them? Well, those would only be in, in other words, the proposals that would be coming in would basically be proposals to develop, say, a 10 or a 20-unit building. So the matching funding in that context would really be coming from other potential funding sources, perhaps matched with HOME or CDBG. Once the program was up and operational, whether or not there was a housing voucher available, what the, you know, family income is from whatever sources, those would be taken into consideration in terms of determining the rent that that person would pay. It has to be affordable at 30 percent of their income. If a portion of their income is coming in from TANF, a portion of it's coming from work, those things would be added up to determine what it would pay. That would be less of a priority ranking criteria, I think. Oh, you guys can't hear me. Okay. So it would be an indirect, but it would be, the idea of the RFP would come in and there would be different scoring criteria. Somebody would come back and say, once this is up and running, this is our target population and this is the income that's likely to be generated, this is the amount of money we need to make this project work. So this is, we're talking about new construction. There's other things allowed in here, but the focus of it really is to add to the supply of units that are available. Otherwise, you don't ever solve the problem. So existing units out there would not be eligible. Correct. Paula wants me to say that it's gap financing in the sense that in order to bring in the other resources, we need to match affordable housing trust funds with other sources of funding. So, again, this is for new housing construction projects, not existing properties? Not entirely. You can have rental assistance, too. It can be for existing, but it would only be for existing if it was only filling a gap. So if there was, if you already had a Section 8 program, it would not be for that program. But if you had a Section 8 program that was not working properly, then you could apply for affordable housing trust funds. And if you needed a gap to make that program continue to work, then it could fill that gap. Okay. So current renters could apply to make up that gap difference. It would not be for an individual rental, but it would be a rental project as a whole. The whole property, like apartment complex? That's correct. But it would be a project that was not working that was going to fail. So it would not just be a project that was, it would be a project that would be going out of existing, that would be going out of being affordable. So it's for projects that would be considering that we would be losing that would be non-affordable. So when we say non-supplantive, that's what we mean with non-supplantive. Projects that we would be losing that would no longer be affordable because they would no longer be there. So if we have a project that we're ready to lose, then we would be trying to find a way to assist that project to keep it in service, so that it would remain online, to remain affordable, and whatever we can do to continue to keep that project online. So give me an example of that. Like if someone had an apartment building. I sense with Falcon Crest the way that a housing authority has gone in and redone Falcon Crest. It was an existing project, but they went in, they bought it, and they have chosen to redo it. It was an existing facility, but they bought it, they have rehabbed it. It's an existing facility, but they have chosen to go in, gut it out, redo it. It's already existing. It didn't, it created new units in that it would have, it wasn't, it was dilapidated. So we have created new, not really new affordable housing, but it's affordable housing. So it is new in that we sustained it. Okay. So what kind of individual would apply for this, an owner of the property? No, yes, an owner. So it wouldn't be individuals coming through? No, it would not be individuals. No, for rental assistance, it would not be individuals. It's still projects. It would be for projects. Have you all looked at possible areas or possible, I guess possible projects? Have you identified anything in the pipeline? No, we haven't. Or given a community assessment of where this could really benefit us and try to identify those yet? No, we have, what the funding committee did is we actually, they actually looked at applications that we denied with the home and CDBG projects. And there were like, really over the past three years, we denied over $40 million in projects. So there is a need because we did not fund that much money in projects. So. Do you have a list of those? Yes, I do. That we could see as well? Okay. Yes. Thank you, Paula. Thank you. Mrs. James? I wanted to, David, thank you. And I will say that this task force has been working very hard. But I wanted, David, to clarify what our role as a council so that as we're giving our input, as we're listening today, what are you expecting to get from us so that you can move forward and what's your next step with this presentation? At this point, the formal report is going to go to the mayor on Tuesday. And from that point, it would be, it needs to be translated, accepted, of course, and then translated into ordinance language. And then an ordinance would be brought before council. So today we're really looking for your response, your questions, your feedback, more than anything else, so that that can be anticipated as we're working through this ordinance language. Ultimately, of course, this has to be passed. To create the Affordable Housing Trust Fund and create the resources for it, it has to be passed through council. But we're not here today for that. Thank you for that. And I will say to my committee, co-committee members, all the input you have, please share it. We need this to be as thorough and as efficient as possible to help meet the needs that David's presentation really outlined. I mean, I think it's very clear there's an issue here with affordable housing. And this is an opportunity to really do something about it. But we can only do it if we can get, we can only do it well if we can get everyone's input, feedback, criticism, praises, anything you have to offer, and even beyond today, before Tuesday if possible, if you hear from constituents or interested organizations, that sort of thing, and they have comments by e-mail or by phone if they call you after this meeting, to please forward that information. You can forward it to me or forward it to David. Thank you. Thank you. Mr. Blevins. Thank you, Dr. Stevens. I just wanted to make sure I'm understanding some of your statistics correctly. I'm on page 49 in our packet, but you don't need to turn to it. It's the one about the households, the number of rental households. If I'm reading this correctly, we would take the 17,000 that are paying more than 30% of their household income and add to that the 8,000 that are paying more than half to get a total of 25,000 and change, almost 26,000 rental households that are above the 30% mark. Am I doing my math correctly? No. Okay. So are the 50 percenters duplicated out of the 30% pool? Right. Okay. So if I waved my magic wand and made 17,312 affordable units appear, we could take care of at least the rental problem. Correct. In other words, the 8,753 families are contained in the 17. Right. You're right. Have you done the analysis of a ballpark figure of what that would cost if someone was to put up the capital to build those units? Well, some of the numbers that we used in terms of how many units were created came up with about $80,000 a unit. So if you multiplied 17,312 times that 80,000, you could come up with a pretty significant number. However, all of those 17,312 would not necessarily need a brand-new unit constructed. Some of them would be rehabbed. It would cost less. We went through this on the funding. There was a lot of private sector folks on the funding committee that were concerned about, you know, how do we know? Why are we coming up with $3 to $5 million as a target? And that's why, actually, we came up with a list of how many projects were turned down as one example, because we needed to document for those folks that there was a need here that was far, far greater than the $4 million that we were asking to start this and get it running. Okay. Well, that's what I was trying to get at. What is the sort of backlog of capital investment we need to make? And then I guess what I'm hearing from you is that there's also an ongoing sort of operational aspect to this, of rent subsidies or something like that. Am I hearing you correctly? Rent assistance is allowed. We're making a recommendation that it be allowed, largely because the further you go down the economic chain, the more difficult it is to have a project pencil out. When you get down into 30% and 50% AMI, it is very difficult with a share of rent at that low income, generates enough cash flow to cover much debt service. Right. We have to come in so projects almost have no debt service, and the rents just cover the operating cost of a multi-unit housing. There was some concern on the group that if we did not allow rental assistance, some of those targets at the very bottom end, you might not have a project one year, so we wanted to allow for an entity, a social service agency, to come in and say, we want to provide for one year rental assistance to 30 or 40 or 100 families, so that that target could be met that year when a physical project didn't come in. Okay. Thank you. Well done. I very much enjoyed you all's presentation, and it's very encouraging. Thanks. Thank you. I do have a question. It looks like your initial funding would be tax dollars, and that's your recommendation. But you say that that can create six or seven times more money coming into the trust fund each year to supplement that. Is that right? It wouldn't come into the trust fund, but it would come into the projects that are funded with the trust fund. In other words, when somebody is submitting a proposal to the governing board for approval, they're going to have to come in and they're going to have to have federal home loan bank dollars and CDBG and home funding and state affordable housing trust fund dollars, because you really, I mean, it's possible, I guess, if you dumped a lot of the money into one project, but the hope is that we'll be able to spread the money around multiple projects, and the people who are submitting those projects would then have access to other dollars, and that's where the matching money would come from. But it wouldn't go into the affordable housing trust fund. It would go to the applicant along with affordable housing trust fund, and then there are multiple sources. So what you're saying is this would help fund affordable housing by supplementing other sources? Correct, in part. We could, I mean, if a project did not have any other funding, there's no limitation in here that a project could not be entirely funded by the affordable housing trust fund, but that's not what the goal is, because the goal is to bring in as much resources and build as much housing, and if you're spreading the cost around, you're going to have more bang for your buck. Do you have other communities as examples besides Lee County, Florida, where this may have happened? Yeah, right now there's about 600 affordable housing trust funds that exist in the United States. Most of them are done at the city and the county level. About 40 states now have affordable housing trust funds. We have one here. Louisville's recently, in the early part of this year, passed their affordable housing trust fund. How are they financing theirs? They're initially financing it by general fund revenues to start it up, and they're still working on their ongoing annual funding source, which they haven't come up with yet. They haven't gotten through council. Yeah. Any other questions? As I understand it, you have not requested we take any action today. That will be forthcoming from the administration. Correct. Just kind of keep everybody posted. Mr. Myers. Thank you, Mr. Chair. Could you tell us how the rest of those programs are funded across the country? I think you spoke about Louisville. The most typical source is with a real estate transfer tax. When you look, there's a report that's put out for the Center for Social and Community Change, and they do an annual assessment and report. I can forward that to any of you that are interested in what they've done in that. It's assembled all the different affordable housing trust funds around the country, how they're funded, what the money is used for. But the lion's share of affordable housing trust funds tend to be funded by an increase, a designated increase in the real estate transfer tax. Last year, the state affordable housing trust fund got through the legislature an increase, I believe, of $6 in the real estate transfer tax, and that's now funding on an annualized basis the state affordable housing trust fund. Could you give us a copy of that report? Yes, we can. And one other question about that report. Does it speak to outcomes? Is it a longitudinal study that shows? A lot of the affordable housing trust funds have really been very successful around the country, and our urgent request at some point is going to be to get this thing off the ground and started, and then hopefully the governing board will be very active in looking at other funding sources, the ones that are mentioned and others. They tend to be very successfully received by the public, particularly if they're wise in terms of the allocation of their resources and using a broad range from first-time home buyers to emergency programs. Some have been very successful in garnering, after they're up and running and people see the results, the communities come back and giving them more money. So that report does have those type outcomes in there? Correct. Okay. And then the proposal for our program, do you have more detail on, say, the rental subsidy and how that works? On the Section 8 Housing Choice Voucher Program or? What you're proposing here. You just spoke of emergency funding, emergency rental. Is that all you want to do or are you wanting to do long-term? The program itself would select from proposals. Rental assistance is allowed, but it's not necessarily dictated. An entity in town that wants to run a rental assistance program would have to submit a competitive RFP and be selected by the governing board. Right. So my question is the governing board, what is its vision? Well, that vision is going to end up coming from the ordinance in terms of what they're specified and required to do. We're making these recommendations in terms of the types of entities that can apply, the types of projects that can be received, and then also recommending that there be a three-year assessment process, because what is needed now may not be needed in seven, eight, ten years. So there's a requirement would be to annually at least every three years do a needs assessment to guide the governing board in developing its RFP ranking criteria. So when you initially put this together, if this takes off, what will be the initial recommendation from the board? And I'm speaking of sort of a mix of a percentage of what will be homeownership, what will be emergency rent subsidy, what will be long-term rent subsidy. I mean, is there a... We don't have it broken down other than the fact that there's a pretty clear prejudice in favor of permanent housing, building permanent housing as being really the major focus of the fund, even though there's other activities allowed. And when you say permanent housing, you're talking about homeownership? No. It could be rental housing. A place where somebody lives that's safe and decent, whether they're paying rent or whether they're paying a mortgage, it puts a roof over their head. Okay. At what point do you think the... We, I mean, Councilman Myers, we didn't do, the committee chose not to designate a specific allocation between the different eligible activities. They thought that was too stringent only because they didn't know in any given year what the need would be. So that's why they left it open. And they left it up to the governing board to decide in any given year what the priorities would be. Okay. Okay? Okay. That's how they left it open. Okay. Okay. Thank you. You're welcome. Thank you. Any other requests to speak? Our meeting will adjourn.