TO: Urban Renewal Agency Board
THROUGH: Steve Powers, Executive Director
FROM: Kristin Retherford, Urban Development Director
SUBJECT:
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Riverfront-Downtown Urban Renewal Grant Program.
Ward(s): 1
Board Member(s): Kaser
Neighborhood(s): CANDO
Result Area(s): Strong and Diverse Economy
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ISSUE:
Shall the Agency Board approve Capital Improvement Program exceptions for maximum grant amount and eligibility restrictions to allow a grant to the Union Gospel Mission to construct a Men’s Mission facility?
RECOMMENDATION:
recommendation
Approve Capital Improvement Grant Program exceptions for maximum grant amount and eligibility restrictions to allow a grant to the Union Gospel Mission to construct a Men’s Mission facility.
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SUMMARY:
Agency Board action to approve exceptions to the maximum grant and eligibility restrictions relating to non-profit eligibility will allow the Union Gospel to leverage Agency funds to secure financial resources to construct the Men’s Mission Facility.
FACTS AND FINDINGS:
The Riverfront-Downtown Urban Renewal Plan, Section 1105, Core Area Redevelopment, identifies grants as an eligible project for funding.
The Salem Strategic Plan approved by Council on January 4, 2018, established several Council goals including accessible health and social services for Salem residents. The Union Gospel’s new Men’s Mission Facility, will include supporting services to help meet the needs of the most vulnerable residents of Salem.
The Union Gospel Mission project meets the Capital Improvement Grant Program Exception Criteria for projects requesting more than the $300,000 maximum grant allowed within the program guidelines.
BACKGROUND:
Union Gospel Mission has been serving the homeless population with its shelter, meals, and service programs for over 65 years. The Men’s Mission Facility will be located at 745 Commercial St. NE and will include the following elements to support the needs of the homeless community in Salem.
• 78-beds for men in various stages of recovery
• 24-hour/7 Days a week, unisex bathroom facilities available to the public
• 40 bike racks
• Indoor and Outdoor storage
• Two separate landscaped public courtyard spaces, protected from public view and highway noise.
• Public showers
• Public laundry facilities for men and women
• Commercial style kitchen to allow members of the public and groups to cook and serve meals
In 2014, the Agency Board approved the Capital Improvement Grant Program which requires grant recipients be for-profit entities. Union Gospel Mission is a non-profit entity that would require an exception to the for-profit requirement in order to receive grant funds.
Union Gospel Mission has submitted a letter dated April 22, 2019, (Attachment 1) requesting a grant in the amount of $749,000. On May 8, 2017, the Agency Board approved “Exception Criteria” (Attachment 2) to determine eligibility for grant requests greater than $300,000.
The following is the application of Capital Improvement Grant Program Exception Criteria to the Union Gospel Mission Project:
Mandatory Requirements
1) Project must meet a minimum of two Capital Improvement Grant Program Objectives
UGM satisfies this requirement through the following two Capital Improvement Grant Program Objectives:
• New Construction
• Alley Improvements
2) 4:1 Leverage of Private/Public Funds
UGM satisfies the 4:1 Leverage of Private/Public Funds based on the following analysis:
Estimated Total Project Costs: $12.71 million+
City Funding Request: $749,000
Leverage: $15.95:1
3) Project must meet one of the following “Other” criteria
UGM satisfies the “Other” criteria of:
• Affordable housing
UGM has funding commitments from lenders, investors, grants, pledges, and estimated sale proceeds of $1.575 million from the sale of their existing facility that total more than $10 million, with a strategy to bridge any funding gaps from their lender and investor partners. Construction is anticipated to start in 2020.
All grants are conditioned upon confirmation of financial feasibility, final construction costs, a qualified contractor, and meeting all of the City of Salem’s building requirements.
Sheri Wahrgren
Downtown Revitalization Manager
Attachments:
1. Union Gospel Mission Letter
2. Grant Program Exception Criteria