Loading...
B Housing Update CIT OF 7700 Market Boulevard PO Box 147 Chanhassen, MN 55317 Administration Phone: 952.227.1100 Fax: 952.227.1110 Building Inspections Phone: 952.227.1180 Fax: 952.227.1190 Engineering Phone: 952.227.1160 Fax: 952.227.1170 Finance Phone: 952.227.1140 Fax: 952.227.1110 Park & Recreation Phone: 952.227.1120 Fax: 952.227.1110 Recreation Center 2310 Coulter Boulevard Phone: 952.227.1400 Fax: 952.227.1404 Planning & Natural Resources Phone: 952.227.1130 Fax: 952.227.1110 Public Works 1591 Park Road Phone: 952.227.1300 Fax: 952.227.1310 Senior Center Phone: 952.227.1125 Fax: 952.227.1110 Web Site www.ci.chanhassen.mn.us 3 MEMORANDUM TO: Todd Gerhardt, City Manager FROM: DATE: Kate Aanenson, Community Development Director August 4, 2003 ~ SUBJ: Housing Update Attached is an update on the Livable Communities Act. This presentation outlines the city housing goals and accomplishments to date. Also included is information from the Housing Summit and on a land trust. I would like to discuss with the Council the possibility of a land trust. Attachments 1. 2003 Livable Communities Act. 2. Housing Strategic Plan. 3. Housing Summit- Summary 4. 2003 Building Permits to date. 5. How the Land Trust Operates. The City of Chanhassen * A growing community with clean lakes, quality schools, a charming downtown, thriving businesses, winding trails, and beautiful parks. A great place to live, work, and play. Chanhassen Participation in the Livable Communities Act 2003 /LCA relate tothe ~ ~ Comprehensive// [ was it ~ ~ plan?~ ~ Why was the Livable Communities Act Established? · 1995 a landmark housing discrimination settlement call the Hollman Consent Decree was started because of a severe housing scarcity for the region's poor. The Hollman settlement mandated the demolition of 770 subsidized rental units in and around the Sumner-Olson/Glenwood-Lyndale projects, the largest public housing in the Upper Midwest. These units were to be distributed throughout the Metro Area. · The state legislature was responding to this law suit and the concentration of affordable housing in the central cities. Legislators such as Myron Orfield were critizing the suburbs especially the southwest "fertile crescent" as discriminating against affordable housing. · A bill called the Livable Communities Act was a compromise law that gave incentives to those communities that were willing to agree to set goals for housing diversity and affordability. What is the Livable Communities Act? · Approved by the Minnesota Legislature in 1995. · The goal of the Livable Communities Act (LCA) is to stimulate housing, economic and community development in the seven- county metropolitan area. · The LCA authorizes the Metropolitan Council to levy funds to create affordable housing; promote redevelopment through cleaning up polluted sites; and to develop compact, high density neighborhoods that are both pedestrian and transit-friendly to local residents. · Participation in the the LCA is voluntary. · The Metropolitan Council is required to report to the Minnesota Legislature on the progress made by metro communities toward providing affordable life-cycle housing. Definition of Life-cycle and affordable housing · Life-cycle housing must have enough variety in its housing stock to support the physical needs and fit the financial resources of residents throughout their lives. It includes rental units for young people, starter homes for first time homebuyers, move-up units and empty nester units. · Affordability is based on the Census Bureau and federal housing subsidy standard defining a housing unit as affordable if residents pay 30% or less of their household income on housing costs. The numbers are adjusted every year. The Metropolitan Council also uses data compiled by the Department of Housing and Urban Development, mortgage eligible guidelines and housing needs. In February 2003, the median income for the Metropolitan area was $75,300. Why does Chanhassen participate in the Livable Communities Act? · Housing diversity has always been a goal in the city's Comprehensive Plan. · 1982 Goal "To provide housing opportunities for all residents, consistent with the identified community development goals." · Policies "The .. city will attempt to provide adequate land for the projected housing growth and to provide housing opportunities for persons of a range of incomes." · Efforts should be made to provide subsidized housing where needed, to provide a balance to the generally high cost of new housing. New construction programs may provide a source of such housing. · The city should promote the use of existing programs designed to reduce land costs for developers of Iow and moderate income housing. · Subsidized housing should be given equal site and planning consideration to non-subsidized housing units and should not be placed in inferior locations or in areas that are not provided with necessary urban service. · The development of alternative types of housing such as patio homes, townhouses and quadplex should be permitted to supplement conventional single family homes and apartments providing that they are compatible with appropriate land use practices. · Housing development methods such as PUD's, cluster development and innovative site plans and building types should be encouraged to help conserve energy and resources for housing. The City's participation in the LCA · The city has been in the paper in the mid 1990's for turning down a townhouse project, the city was labeled in the paper as "elitist." · Town and Country Homes was rejected because it was industrial land and the city did not want to re-guide it residential for tax implication reasons. The city was given a black eye on this issue; the city rightly argued that zoning for housing should occur at the local level. · The city wants to maintain its eligibility for funding from the Metropolitan Council and scoring for any State of Minnesota project. · The city is cognizant of its role in the region - the city has and is continuing to create a significant work force in the, region. Housing is not just a social issue but also a future economic growth and stability issue. · The city's strategic plan and recent "State of the city 1999" stated that the city "will encourage a broad range of housing options." What are the city's LCA Goals? Table 2-3 CITY INDEX BENCHMARK Affordability Ownership 37% 60-69% Rental 44% 35-37% Life-Cycle Type (non-single 19% 35-37% family detached) Owner/Renter Mix 85/15% 67-75 / 25-33% Density Single Family 1.5/acre 1.8-1.9/acre Detached Multi-family 11/acre 10-14/acre Overall Average GOAL 30% 35% 34% 1991 Comp Plan 80-90 / 20-10 1.8 9-10 3.3 RESOLUTION ELECTING TO CONTINUE PARTICIPATION IN THE LOCAL HOUSJNG INCENTIVES ACCOUNT PROGRAM UNDER THE METROPOUTAN LIVABLE COMMUNITIES ACT CALENDAR YEAR 2002 WHEREAS, ~ Ivletmpolitm't Livable C.,ow'aunides Act (Minfmso~ Stalues Sectio~ 473.25 to 473.254) estal:dtahea a IVletfT~x31itan Livable C,e~munities Fund which ia inlended to address houaing ~ other development issues lacing ~ metropolitan ama detined by Minnesota Statutes sec~on 473.'121; WHEREAS, a metropolitan area mmictp~ty is not ~ lo mce~e grants o'loar,,s under the IVletmpelitan Livable Commurities Fund ~ eli~Ue LocaJ Housing Incenlives Account Program ur, der Ihe ~ ~atue~ section 473.254; a~l 15 ol each year; a~l WHEREAS, tot calendar year 20~1, & ~ ama munlcipellty that pa~:ipated in the Local Houaing Incentive Account Program dud~ ~ calefxJar year 2000, can continue to participate under ~ ~atue~ am:~ion 473.264 it: (&) Ihe rmaicipaity elects to pal'dcipate in the Local Houaing Incentives NOW, THEREFORE, B~ IT RESOLVED ,~at the C~ty ol Ctw~hasaen hereby elects to padicipate in Ihe ~ ~ I~ P~ ~r How were the goals set? · Building trends · Vacant land · Demographic data · Market Forces Historical Building Permit by Type / / o · , - , ................ Ye~ ~ SINLESSLY ~ DUPLEX Residential Building Permits Issued Single Town Tot~ Year Family Du~ox Houses Apa~rnents Dwelling 1980 41 18 40 99 1981 22 2 24 1982 19 2 21 1983 6O 8 36 104 1984 108 34 24 166 1985 189 38 20 18 265 1986 246 8 8 262 1987 289 2 32 323 1988 352 26 34 412 1989 307 14 62 383 1990 197 197 1991 191 191 1992 228 228 1993 251 16 267 1994 269 110 379 1995 216 197 65 478 1996 170 37 207 1997 177 97 274 1998 263 162 425 1999 187 88 277 2000 124 34 162 320 2001 85 44 100 229 2002 54 246 300 How are the goals enforced? · Every year the city is required to submit a report to the Metropolitan Council on the progress made toward the goals including local fiscal commitment. · The city is given an ALHOA amount (Affordable Life- cycle Housing Opportunities Amount). · The ALHOA formula uses current market value, the Consumer Price Index and the city's tax rate. If there is no growth in the total excess from 1995, then there is no opportunity to increase the ALHOA amount. · In 2002, the city had an ALOHA amount of $38,269 opportunity to provide for affordable housing. The city contributed $81,849. What has the city done to meet the goals? There are two ways to achieve the goals market forces · Zoning changes are not required for all projects. Each development has different needs. · Where there is no city financial assistance the only tool the city has is the zoning ordinance and the ability to provide changes in it to make a project happen. Assisted · Financial Assistance from other sources other than the developer · City EDA Tax Increment Financing - Housing District · Carver County HRA · Community Development Block Grant · Minnesota Housing Finance Agency · Section 8 Assistance Program · Metropolitan Council HRA · Habitat for Humanity What have we done to meet the Goals? · Market rate (there is no assistance from the city) · Mission Hills · Autumn Ridge · Oak Pond/Oak Hills · Prairie Townhomes · Walnut Grove · Lake Susan Townhomes · Lake Susan Apartments · Assisted (there has been financial assistance from the city) · Centennial Hills · North Bay · Presbyterian Homes Tie of the LCA to the Comprehensive Plan · The Metropolitan Land Planning Act requires all communities to include a housing element in their comprehensive plans and establishes the Council's responsibility for reviewing the housing element of the plan. Elements of the Housing Plan must include: · Affordable housing · Mix of housing types · Development/redevelopment densities mix use · Employment housing linkages · Concentration of lower-cost and/or substandard housing · Comparison with other communities · Relations to regional plans and policies · Housing policies on residential land use control, local housing implementation activism and maintenance · The plan must include "official controls and land use planning to promote the availability of land for development of Iow and moderate income housing (Minn. Stat. Sec.473.859, Subs. 2) · Lifecycle Housing Implementation Program/Action Plan · Housing program · Local controls · Local fiscal devices that can be used to assist or facilitate Chanhassen Affordable Housing Goals under the LCA (Nov 2002) Owner Occupied New Construction Project Year Units Mission Hills 1995 200 North Bay 1995 35 Autumn Ridge 1996 112 Walnut Grove 1997 128 Arboretum 2001-2003 227 Village Powers Ridge 2003 under 82 Condo construction Total 784 Rental New Construction Project Year Units Centennial Hills 1996 65/39 Lake Susan 2000 162 Apartments Powers Ridge 2001 262* Apartment 100 built 2002 Presbyterian 2003 161/33 Homes under constuction Total 650/72 * total proposed Affordable City financial assistance to date has been on three projects - two rental and one owner occupied. Centennial Hills · All units subsidized at approximately $1,500 (no property taxes) · Subsidy approximately $61,199 per uni0. This subsidy is based on tax forgiveness. This project pays $28,000 a year in taxes versus a market rate project would pay approximately $130,000. ((Example $130,000-$28,000=-$102,000/65 units= 1,569 tax per unit * 39 affordable units = $61,199.00)) · Approximately $300,000 is being held in escrow should the project short fall occur (30 years) · Land Acquisition $100,000 North Bay $700,000 (not including interest) subsidy of 35 units through the HRA for the creation of a housing district · 18 units will be for first time homebuyers ($95,000) · 17 units will be affordable by the LeA standards (under $120,000) · Subsidy approximately $20,000 per unit Presbyterian Homes 33 affordable through TIF $1,060,000 over 8 years 2006-2008. First 6 years they get 90% of increment and last 2 years they get 50% of increment. 10 Chanhassen Affordable Housing Goals Progress under the Livable Communities Act (Nov. 2003) Goals Long term Results Percent of Goals To-Date Long-Term 1995-2010 Goals Owner - Occupied New Construction Rental New Construction Or Acquisition Affordable Total 1,562 units 784 units 50% 650 total units 202 units 72 affordable 36% units 1,764 units What the LCA doesn't do · Require a minimum lot size · Mandate zoning [] Determine housing type or mix of a project · Override market forces such as establishing a for sale unit at a certain price 11 Implications of requiring all Medium and High Density to have 30% affordable · This would result is an overall ownership affordability of 18 percent city wide for all housing types. This means a total of 2,485 units or 1,315 less than the city current goal. · Since the original goals were established the city has re-guided the Eckankar property for a loss of 40 acres of multifamily and may possibly lose the Gorra site to a golf course. · The comprehensive plan state that we encourage density at the higher end. In the past the city has not denied projects that have come under the density. The city also not mandated the price of a dwelling unit with the exception of North Bay. Each developer has different expectations. Because development occurs over time this issue is very sensitive to market dynamics. · Might force a specific type of product to achieve density. CITYOF CHAN SEN 7700 Market Boulevard PO Box 147 Chanhassen, MN 55317 Administration Phone: 952.227.1100 Fax: 952.227.1110 Building Inspections Phone: 952.227.1180 Fax: 952.227.1190 Engineering Phone: 952.227.1160 Fax: 952.227.1170 Finance Phone: 952.227.1140 Fax: 952.227.1110 Park & Recreation Phone: 952.227.1120 Fax: 952.227.1110 Recreation Center 2310 Coulter Boulevard Phone: 952.227.1400 Fax: 952.227.1404 Planning & Natural Resources Phone: 952.227.1130 Fax: 952.227.1110 Public Works 1591 Park Road Phone: 952.227.1300 Fax: 952.227.1310 Senior Center Phone: 952.227.1125 Fax: 952.227.1110 Web Site www. ci.chanhassen.mn.us MEMORANDUM TO: Todd Gerhardt, City Manager FROM: Kate Aanenson, Community Development Director DATE: March 7, 2002 SUBJ: Strategic Plan - Housing BACKGROUND The third goal identified in the city's Strategic Plan is the following: III. Housing -the goal is to increase the supply of affordable housing a. Serve as the convener of the private and non-profit sectors to develop housing strategies that are multi-sector i. A possible tactic is to convene as Housing Summit with very broad participation by the sectors. ii. Attempt to develop a clear identification of the roles various organizations will play in working on this issue b. Explore some of the more recently adopted tax credits and other financial support programs that could support the development of affordable housing. PURPOSE Staff is proposing that a Housing Summit be directed to achieve community support, council direction and develop strategies for housing diversity. The following is an outline of how the summit would be conducted. Staff is looking for input from the council on this proposal. HOUSING SUMMIT WHAT - A Housing Summit. A group of opinion leaders in the community to help develop housing diversity strategies. At least two to three meetings will be necessary. A facilitator will direct the discussion. Staff has someone in mind from the U of M Extension Service (Nancy Lenhardt). WHY - The opinion leaders reflect a cross section of the community; public and private. They will continue the work started with the housing forums. Background of housing data and polices will be provided. With the direction of the facilitator, strategies will be developed. The City of Chanhassen * A growing community with clean lakes, quality schools, a charming downtown, thriving businesses, winding trails, and beautiful parks. A great place to live, work, and play. Todd Gerhardt, City Manager March 7, 2002 Page 2 WHO- A representative(s) from the following sectors Developers Banks Churches Service Organizations Local Employers (Pillsbury, Rosemont, etc.) School District Carver County WHEN - May 2002, a series (2 -3 weeks in a row) of either morning or evening meetings WHERE - City Recreation Center or City Hall g:~lan~ka~housing~summit.cc.doc HOUSING SUMMIT City of Chanhassen May 23, 2002 Common Themes To have life style housing available to live, work and play. What do you want your community to be? If you want/provide housing within the community so it can be a place to live, work and play. · A viable community where all people are invested. · Philosophy on-going and updating. · Definition Education/constant to new people moving in Engaging larger community- faith/business/government/education/in housing planning implementation. · Affirmation · Policies/zoning new · Long-term planning to make the best use of the land Group 1 Re-evaluate the current land use and zoning. - rezone to medium and high density Review park dedication in cash fees versus land taking - evaluate need in every neighborhood - work with the park commission - meet neighborhood life style needs Property tax - concern with increase for seniors Fewer land use restrictions Engage key local businesses in affordable housing issues Local official housing (champions) and support of government - Work with community leaders and business organizations - Inform and educate Citizens/public of vision Staff Council Group 2 Group 3 Affirm support - constituent a dialogue - contributions Educate Define life styles affordable Define Chanhassen's needs - who and price tellers college graduates pastors age groups one size does not fit all Define options / product Means to affordable - recognize that $'s are needed Dollar sources - Faith-community - Government - Private Other - Density/zoning - Fees/but for/zero loss big help to builder Streets - Allow for narrower Retention - How long to we need it? - Which parts- continue surveying - How do we keep it? Rental/long term assistance For sale/land trust, corporate inc., 2nd mortgage Property tax Ensure a range of housing types, ages, price ranges throughout the community - Take the focus off of only new construction as only affordable - Support first time owners in existing/older stock Partner to provide classes to build renovation skills - (Hardware stores, Community Ed, etc.) City has an on-going educational process on housing - Community conversations What makes our community whole? Who needs to live here? - List of resources, options for seniors to stay in homes (e.g. reverse mortgage), option for first time buyers - What can community agencies, businesses, individuals contribute? Habitat Banks Christmas in May - Is HRA the vehicle? Shift to active outreach/education City policies, practices, schedules, facilitate, ability of developers to produce affordable housing. Also, think housing in price range to allow lateral move within community (single family - townhome) Explore/identify/implement methods to hold housing stock (by city and business) and keep affordable for the next owner. Promote long-term planning to repurpose buildings no longer needed as schools and businesses. Locate schools in residential areas and build with the flexibility to convert. g:\planXka~housing\goals BUILDING PERMIT DATA 2003 7/30/2003 N~ Permits B~os. Uj3j~ yaluation!Pe~mits ~ ~ Valmtbn p~s B~. ~ ~al~tbn P~s ~ ~ Val~tbn ~ B~. ~ Val~tbn Pe~s ~ ~ Val~tbn Pe~s ~ ~ Val~t~n S~n 1 R~e~l ~ SF D~ACHED 101 7 7 7 ~,~,~ ~ 6 6 6 ~,~,~ 1 1 1 ~,~ . 3 3 3 $1,~,~: 4 4 4 $1,310,~ 3 3 3 $1,~9,~ 24 24 24$ 9,7~,~ SF A~ACHED 1~ 4 1 4 ~,~ = 8 3 8 ~7,~ 3 I 3 ~79,~ ~ 5 2 5 $709,~ 8 4 8 $1,~,~ 28 11 28$ 3,~,~ 2-FAMILY 103 : 0 0 0$ 0 0 05 ~ F~ILY 104 ' 5 OR ~RE F~ILY 105 ~o I 8 ~2,~ ~' 1 I 8 ~2,~ I 1 8 ~2,~ 1 I 8 ~2,~ I 1 8 ~52,~ I I 8 ~2.~ 6 6 ~ $ 3,312,~ S~total 109 ,~ 9 19 ~,~3,~ 15 10 ~ ~,573,~ 5 3 12 $1,~1,~ ~ 9 6 16 ~,2~,~. 13 9 ~ ~,~,~ 4 4 11 $1,561,~ 58 41 1~ $ 16,415.~ S~bn 2 R~NaI. ~n 0 0 0 $ HOTEL~OTELS 213 0 0 0 $ OTHER 214 S~total ~ ~ ~ ~ ~ ~ 0 0 0 $ S~n 3 No~al Am~m~ 318 Ch~ 319 Pa~i~ Se~e ~at~R~ ~aFl~l ~3 ~~mf~m ~4 P~I~ Wo~ ~5 1 1 $14,~ ~ls ~6 ~o~ ~7 I I ~12,~ ~ ~8 , 1 1 ~,~ ~ ot~ t~n b~ ~9 2 $1,~ 1 S~total 3 I - $15,~ I 1 - ~12,~ ' 2 1 - ~,~ S~n 4 ~1 ~7 2 2 ~1,~ I 1 ~,~ ~otal ~ ~ - ~19,~ ~ ~ - ~31,~ S~bn 5 Detrain SF A~a~ ~ 2 2 2 $17,~ 2 Fam~ ~6 ~ fami~ ~7 5 or ~re famiN~8 ~ ~9 2 2 1 S~total 2 2 2 $17,~ 2 2 1 TOT~ ~ ~ 21 ~,7~,~ ~ 57 ~ ~,016,~ 49 ~ 12 ~,~,1~ = ~ 73 18 ~,~,~ ~ ~ 21 ~,251,~ 74 ~ 11 ~,537,1~:4~ 3761~ $ 26,4~,7~ Av~ Val~t~ Av~ : Va~t~n ~n 1 ~1 SF D~ACHED ~11 ,~7 ~9,~ ~,~ ~.~7 ~7,~ ~,~ $ ~,~.67 SF A~ACHED ~,~ $1~,875 ~,~ $141,~ $127,~ ~DIV~I $ 119.~.~ 2-FAMILY ~DIV~! ~t ~IV~! ~1 ~t ~IV~! ~DIV~I ~ F~ILY ~DIV~! ~IV~I . ~1 ~1 ~IV~I ~lV~l ~DIV~I 5 OR ~RE F~ILY ~,~ ~,~ ~ ~,~ ~'~ ~'~ ~'~ $ ~'~'~ A~ ~,1~ ~7,~ $110,917 ~141,~ $1~,1~ $141,~9 $ 0 0 05 0 0 05 0 0 0 $ 0 0 0 $ 0 0 05 0 0 05 0 0 0 $ 1 I 0 $ 14~000 0 0 05 - 1 1 0 $ 712,000 2 2 $33,500 ~ 3 3 $1,500 2 2 $1,000 8 8 0 $ 131.000 7 $18000; 8 $37,000 8 $39,000 26 0 0 $ 95,500 9 2 - $51,500 11 3 - $38,500 10 2 - $40,000 36 10 0 $ 952,500 35 35 $587,600 55 55 $735,150 66 66 $720,100 52 52 $650,100285 285 0 $ 4,222,750 5 5 $.502,000, 8 8 $3,3,34,000 7 7 $511,D00 6 6 $264,00029 29 0 $ 4,831,500 2 2 $38,000; 2 2 $22,000 4 4 0 $ 60,000 42 42 - $1,127,600 ;~ 63 63 - $4,0~9,150 73 73 - $1,331,100 ~ 60 60 - ~36,100:318 318 0 $ 9,114,250 i 2 2 2 1 I 1 5 5 5 $ 17,000 0 0 0 $ i o 0 o$ ~: 0 0 05 , 3 2 I $ 1 ' $0~ 3 2 2 $0 1 1 1 $0 $0 8 7 6 $ 17,000 How The Trust for Public Land Operates 1. What is The Trust for Public Land? The Trust for Public Land (TPL) is a national non-profit land conservation organization founded in 1972 to protect land for the public's use and enjoyment. TPL has safeguarded more than half a million acres of historic, natural and Scenic lands throughout the country. Not a membership organization, TPL works with private landowners, citizen groups and public agencies at all levels of government to solve problems associated with complex conser- vation real estate transactions. TPL can act quickly to buy land to protect it until public funds are available. These lands are eventually purchased from TPL by public agen- cies that can provide permanent stewardship. In addition to technical assistance, TPL offers training to citizens, nonprofits and government agencies on ways to protect land. Summary of TPL's work since 1972 578,005 acres protected 164 new land trusts started Assistance to over 300 land trusts Savings to agencies since 1972 * Agencies and nonprofits: $124.8 million All federal agencies: $17.8 million Savings since 1986 * All federal agencies: $4.1 million Bureau of Land Management: $82,000 National Park Service: $1.73 million U.S. Fish & Wildlife Service: $678,000 * Represent~-h-h~aJes fair market value. 2. How does TPL work with the government to protect land? TPL is an independent private organization---not a government contractor. TPL is a partner with government in realizing its goals of acquiring land for conservation and public use. TPL acts at the invitation of a landowner or government agency to help bring conservation lands into public owner- ship. TPL takes on the most difficult projects that government agencies might not be able to accom- plish on their own. TPL often can take risks that government agencies cannot. TPL has no guarantee that government agencies will be able to subsequently acquire the resource lands in which TPL invests time, energy, capital and operating funds. There is no charge to public agencies for TPL's services. 3. What percentage of TPL's Income comes from land transactions? Sixty percent of TPL's operating income comes from contributions from land owners involved in our open space transactions. Willing sellers of land having significant scenic, recreation, historic or wilderness value often choose to sell their land to TPL at a price below market value, thereby making a charitable donation of land value to TPL. Landowners recognize that bargain sales to TPL are voluntary. _ TPL retains the landowner's gift of land value to pay for costs of the acquisitions, to buy impor- tant conservation lands, and to help others save land; Donations of land value, which may gener- ate a tax deduction for the landowner, may provide support not just for the transaction at hand, but for the full range of TPL's public benefit activities. -, Land owner donations to TPL do not affect the fair market value of the land, which is what the government is required to offer for the land it buys. When TPL sells the land, the sale price is based on the land's appraised fair market value, as determined by the acquiring government agency. 4. Why would a landowner sell land to TPL at a discount Instead of working directly with the government agency? The large majority of landowners do sell directly to government agencies and there is no need for assistance by groups like TPL. TPL focuses on those land opportunitieS that public agencies cannot promptly act upon. When priority lands come up for sale, public agencies often do not have the. funding in place to purchase them. Landowners may be unwilling or unable to wait out the process, and the opportunity to protect public resources can be lost. As an independent public-interest organization working in the marketplace, TPL can provide timely commitments to landowners in order to keep their lands off the private market until acquisition by a permanent steward, such as a county park district or a federal or sffite agency, is poSSible. 5. Why do government agencies work with TPL? As a private organization, TPL can render timely services which may not be available to government agencies, such'as: · Arranging financial details, such as estate planning; · Timing to meet landowners' needs; · Confidentiality in negotiations; · Interim financing for land protection; · Assembling multiple private parcels; · Optioning properties to take them off the market; · Dividing and spinning off lands that are surplus to agency requirements; · Arranging multiple party land exchanges. SOURCES OF FUNDS 60.0~ CONTRIBUTIONS OF LAND VALUE 22.8% OTHER CONTRIBUTIONS AND GRANTS 7.8% INTEREST INCOME 9.4% OTHER INCOME FISCAL YEAR ENDED 3/31/91 TOTAL: $23,516 USES OF FUNDS PROGRAM SERVICES 84.6% MANAGEMENT & SUPPORT I 1.8% DEVELOPMENT 2.9% INVESTMENT LAND ACTIVITIES 0.7% . FISCAL YEAR ENDED 3/31/91 TOTAL: $23,203 6. How does the government agency determine how much to pay for the land? Government agencies must by law~ offer fair market value to all landowners from whom they purchase property. (The agencies have statutory duty to offer every.landowner -- whether it be a speculator or nonprofit -- the land's appraised fair market value.) The fair market value is deter- mined by appraisals that are approved by the staff at the acquiring agency. TPL does not have its own appraisal staff. Appraisals are prepared by approved professional appraisers according to federal guidelines. The fair market value is determined by an independent appraisal subject to agency approval process. Government agencies pay no more than fair market value for the land they purchase from TPL. There are cases where government agencies paid less than fair market Value when acquiring land from TPL. In several instances, TPL has donated land, services and funding to an agency to make an acquisition possible. 1 The Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970. Sec. 301 (42USC SEC 4651). Who Pays the Cost of Saving. Land? Pre-project planning and negotiations Option payments Legal work . Appraisals Interest on funds to hold land .Surveys On-site environmental assessments Title work Environmental analysis Special reports Cultural resource surveys Mineral surveys Economic studies Toxics reports TPL =Public Agency X X X X Costs sometimes shared X X X X X X Costs sometimes shared X X X X X 7. Who determines which properties should be protected for the public? The public, through its representatives, decides what conservation properties are priorities for acquisition. TPL works with, not for public agencies. TPL meets regularly with government agencies, legislative committees concerned with the protection 'of resource lands, and citizen groups to dis- cuss their land acquisition priorities where TPL may be of service. As a private nonprofit organization, TPL can only buy land from willing sellers. Once TPL has secured a parcel of land, the appropriate federal, state or local agency, often with legislative direc- tion from elected officials and input from citizens, determines whether it wishes to take advantage of the conservation opportunity TPL has afforded. In the case of federal land management agencies, most land acquisition funding comes from the Land and Water Conservation Fund, which is derived primarily from federal offshore oil lease revenues. Each year, Congress gives these agencies direction on the resource lands in which to invest a portion of these funds. 8. How does TPL spend the Income it earns through land conservation transactions? In 1991,85% of TPL's land-saving revenues went directly to our land saving work, and to an extensive educational program that teaches others how to protect public land. TPL helps communities start land trusts, which are citizen based nonprofit organizations that save land on a local or regional level. TPL has started 164 land trusts and worked with over 300 others in the past 20 years. Less than 15% of TPL's revenues have gone for administration and fundraising. TPL is rated as having one of the most efficient fundraising programs. The Chronicle on Philanthropy recently rated TPL among the leanest, most efficient fundraising organizations of 20 national conservation organizations stud[ed. The October, 1991 issue of Forbes magazine rated TPL a 96% on its Fundraising Efficiency Index. Forbes also gave TPL a 84°/° on its Program Commitment Index. This number shows that TPL is committing 84% of its revenues to its land protection program. 9. TPL is a nonprofit organization, but isn't the organization realizing a profit from land sales? Just Compensation No. TPL is a nonprofit organization with tax exempt status under state and federal law. The organization cannot make a profit. Profit is when income is more than expenses and is shared with Board of Directors, executives or shareholders. Nonprofits are forbidden by law from distrib- uting their income in such a way. TPL's staff is paid a salary. No commissions or bonuses are paid to anyone on TPL's staff. TPL's Board of Directors are unpaid volunteers. TPL has no shareholders or associated for-profit entities. TPL derives support from land sales and from philanthropic individuals, corporations and foundations.' Sixty percent of TPL's operating income comes primarily from its land sales to govern- ment. That income represents the landowner's gift of land value, which is used by TPL to protect more land and to fund programs that do not generate funds. The Trust for Public land conveys land to public agencies at a price determined by the agencies to be the land's fair market value. The Fifth Amendment to the U.S. Constitution provides that "private property (shall not) be taken for public use, without just compensation." The constitutionally- mandated notion of just compensation is reflected in The Uniform Relocation Assis- tance and Real Property Acquisition Policies Act, enacted by Congress in 1970: "Before the initiation of negotiations for real property, the head of the Federal agency concerned shall establish an amount which he believes to be just compensation therefor and shall make a pr~ifip-t~ffer to-~cquire the property for the full amount so established. In no event shall such amount be less than the agency's approved appraisal of the fair market value of the property." 10. Does TPL make money on each of its projects? No. Donations to TPL of land value from landowners don't always cover the costs of the trans~ action. For example, in 1982, demolition was scheduled for the Atlanta neighborhood where the Reverend Martin Luther King grew up. There was no adequate public or private funding to save this historic area. Nevertheless, TPL moved to protect the site, which is now a national park. In 1992, TPL successfully mounted a private fundraising campaign to make possible the pro- tection of the Marin Islands in San Francisco Bay by the U.S. Fish and Wildlife Service. The land- owner made a generous donation of land value to TPL, but it didn't cover all that was required to make the transaction work. TPL has a long-standing commitment to programs that secure neighborhood parks and commu- nity gardens in urban areas mthese programs depend on funds generated from other sources. TPL also provides free or Iow-cost technical assistance and training to nonprofit and citizens' groups trying to conserve land. 11. How long does it take TPL to close a project? The closing is only the tip of the iceberg of the work required to save land. TPL transactions are complex and typically require several years of TPL involvement and hundreds of hours of staff time. There are expenses and risks associated with transactions including legal costs, option pay- ments, appraisals, interest, surveys, and environmental assessments. Many TPL transactions are multi-phased projects or part of ongoing conservation programs to protect entire resource areas that are carried out over several years. The Trust for Public Land, 116 New Montgomeq~, fourth floor, San Francisco, Callifornia, 94105 Phone (415) 495-4014, Fax (415) 495-4103