Councilmember Letitia Johnson present council member Mary Waters present.

Mr.

Chair, we have quorum.

Thank you so much, Madam Clerk.

That'll move us on to the approval of the minutes.

Um from our June 3rd, 2026 meeting.

Members of the committee should have received a copy.

With that, is there a motion to approve the minutes?

Motion.

There's been a motion to approve the minutes on the June 3rd, 2026 meeting.

See no objections, the action shall be taken.

I know today and tomorrow the heat index is supposed to be over 100 degrees.

And also at the Detroit Library branches.

So if you know someone who may not have um access to shelter or uh cooling systems in their home and need a reprieve, please do share that information.

Um with that, that'll take us on to public comment.

Uh public comment.

The request for public comment will close at 119.

Um folks will have two minutes.

We'll start with folks in the room and then move to folks virtually joining us via Zoom.

If you are on Zoom, please use the raise hand feature to indicate that you are wanting to give public comment.

Uh saying that there are no folks currently in person for public comment, we'll move on virtually.

And who is our first speaker?

How many folks do we have so far?

Uh good afternoon, Mr.

Chair.

We have 10 hands raised as of now, and our first speaker is Jadante Smith.

Thank you so much, Mr.

Smith.

Good afternoon.

Um, you have two minutes.

Good afternoon.

I want to say I appreciate you, Chair, for reaching out about my issue uh with this not necessarily my issue, but it's an issue with uh our voting system and how um my sister-in-law has been canceled at the state level, but she still received an absentee ballot um application form, which doesn't make sense to me because that means that anyone in this household or anybody at the city or the county level could use this person who doesn't live in the state of Michigan who hasn't live who hasn't lived in state of Michigan for the last 20 years, who is registered to vote in the state of South Carolina and has had a driver's license there for 20 years almost my entire life.

Actually, 25 years, 25 years to be exact.

Um I think that that is fraudulent, and I think that Giannis Winfrey um and at the county level, uh Kathy Garrett are both committing fraud uh in their in their handling of our ballots and our systems.

Also, I just spent some time in district three, didn't even want to do it, but I was riding down Van Dyke and I saw uh one of those orange coned off areas of a lot.

And I feel like whenever you see one of those in C V tray, you know there's contaminated dirt.

So I it was on Elgin Street, so I'm thinking, you know, this is odd to see one of those lots right by the solar farms.

So I go down the street and I see not only uh contaminated lot hole is a hole in the ground, just like we've seen in district four, we're gonna see in district six, we're gonna see all across the city.

Uh the sidewalk was not replaced as well, and there's a giant hole in it in the ground, and there's a house that has kids a block away.

So not only do residents have to contend with this 35-year plan for um DTE to have these solar farms there, which is continuing to blight their neighborhood because these things aren't pretty, and people are going to scrap them.

They're not going to be protected.

The city of Detroit Police Department is not going to be able to protect these solar farms, especially not over people.

And then they have these contaminated dirt lots.

So in Eldrin, in between Castle and Van Dyke, there are three lots.

So one is got the dirt removed already, and so there are two other lots, and there are sure multiple other lots that have this contaminated dirt.

We need to do something about that.

Nobody should have to pay taxes to have to live around contaminated dirt and solar farms.

We didn't ask for.

Thank you, Mr.

Smith.

Um, if you can send me might not be able to get the ad the street numbers of the lots, but if you can just send me that I know you gave the boundaries, but uh known house number near it, uh that would be great.

Um, but we'll I'll check into that.

Uh next speaker.

Our next speaker is William M.

Davis.

Commissioner Davis, good afternoon.

You have two minutes.

Uh good afternoon, can have you heard.

Yes, you can.

I like to remind all City Track Retirees to listen to City Track Retirees know that next week on Thursday, there's gonna be uh acidity track retirement task force hybrid meeting.

Um in fact, two of the three city council people sitting there are on it.

And that um my city council person, uh you young man, and uh member at large, Mary Waters.

It's gonna be uh on the 18th from one to three p.m.

Coban Young Municipal Building.

Uh, it's gonna be in person and on Zoom.

And uh I encourage city retirees to come out, and I encourage people to know that we we still need help, and the city should be exploring ways that could help us, especially as you see every week.

It seems like the city is given tax abatements or you know, property tax cuts or these this I understand this uh payment in lieu of uh taxes thing, you know, like and people are steady trying to move into the city.

So why are we continuing to give so many incentives to people to do this?

You know, people want to move here, people need to move here.

We want people to move here, but I think we've given away too much, especially so much that we are not returning, you know, none of the losses to the city chart retire that we see every single month.

Those of us just paying the car back.

So I think the city should be moving to be more equable and helping the city chart retirees should be more equable and helping more of the existing businesses, more of the existing residents in our city.

Thank you.

Y'all all have a great day.

Thank you, Commissioner.

And we will definitely have a conversation on the pilot as well.

Um before we move to the next speaker, I see Mr.

Foster.

Are you wanted to give uh public comment?

If so, we'll have you at the end of the virtual, but just want to make sure we get you down.

All right, thank you.

Next speaker.

Our next speaker is Owner Papa.

Ms.

Hughes, good afternoon.

You have two minutes.

Good afternoon, and to the chair.

May I be heard?

Yes, you may.

Okay.

Yes.

Um, and where would the people in District 7 go for cooling?

We have no rec center in District 7.

So do you can you instruct those people?

And if you're talking about the the library that I used to go to when I was in elementary school, it's a very small library.

I'm not sure how many people that would hold.

Um you have on your agenda today just discussed the citywide payroll performance audit, which is Dismal, which you guys have put off since January of this year.

We have kicked it around, kicked it around, but we need to discuss it as well as the pilot program.

We need some numbers on how it is reducing the number of the blight, the blight in the city, how how it's helping that, and um how it's helping to get people in houses.

Um, you know, the Herman Kiefer, you know, that was another project.

Now we don't have a health department.

It seems like you guys just keep uh creating these little piles of excrement all over the city.

The dirty dirt is is bad enough.

The dirty air is bad enough.

You're killing people.

That's what you're doing.

And you're sitting here presiding over it.

If you think you're helping the people in the city of Detroit at large, walk around the city and see what it looks like.

You're spending millions of dollars to clean up freeways, but you won't clean up your own areas, and then you sit there on the body as a body and then blame the citizens.

Oh, we're dumping.

You know, we put cameras in like 20, 30 years ago to stop blight and dumping, and it hasn't stopped it.

What you're doing is the same things that we've always done, and they don't work.

It doesn't work when you don't ask citizens how to resolve their own issues.

No, you just created creating the issues for us.

The dirty dirt is something that this body created for the citizens in the city of Detroit and is incumbent upon you to clean it up.

Thank you, Ms.

Hughes.

So for folks in District 7 who are on the west side of uh Southfield Freeway, the closest would be Edison Library.

For the folks who are on the east side that are south of 96, um, the closer will be the Helen Moore Recreation Center.

And for the folks on the north side of District 7, you can go to Adams Bus.

So I'll be in contact with the health department if any of those places get full uh to push for another location as well as we work to get the new recreation center built.

Thank you, next speaker.

Our next speaker is Betty A.

Varner.

Miss Varner, good afternoon.

You have two minutes.

Uh good afternoon, Chair, and to all within the sound of my voice.

I'm Daddy A.

Barner, president of the Soda Else World Black Association.

Uh want to speak this afternoon about uh uh a Rise Detroit annual event that we have, which is August 1st.

The time would be from 11 to 3.

Uh I will be sending out emails or texts in regards to our event because we are seeking uh vendors, people who want to give our resources to help uh the Detroit Metro uh residents.

Uh we do have uh DMC is going to be available.

Uh Wayne County Treasurer mobile unit will be available.

We will be giving away free bikes.

We've done that for the last four years.

All you have to do is show up and sign up.

Uh we will also be offering free haircuts.

We are seeking volunteers because we like to have put up our tents, and but we need volunteers to assist us putting up the tents and breaking them down, and the setup time for that will be uh at 10 o'clock.

We uh haven't confirmed, but each year we've been blessed to have a hair braider, uh volunteer time, so that we can uh offer the free hair braiding.

So we're working on that, but we are hoping to be able to do that also.

Food will be free, there'll be a bouncy house.

We're going to have games, uh big whists, uh spades, uh dominoes, uh checkers, and other games we have purchased that's uh, you know, that's active for the children, but they're family-friendly games.

Well, the adults and children can uh have playtime together.

So please uh assist us and help us achieve our goal.

Thank you, Miss Varner.

Uh next speaker.

Our next speaker is on twice as legendary Detroiter and Black Bag.

The first is legendary Detroiter.

Mr.

Crawley, good afternoon.

You have two minutes.

Uh Ms.

McCamber.

Denzel McCambra.

Sit it next to you are two TV and public officials.

The reason why I say that is because I'm the one who did the investigation.

Ramon Jackson took it to another level.

Now, federal cases involving election fraud.

Dennis Winfrey is busted, busted, busted.

Daniel Baxter is busted, busted.

And Gina A.B.

Walker needs to come before the citizens, taxpayers' residents, as well as the city council, and explain how Mary Lane Beckman's ballot was counted in the February 27th, 2024, United States presidential election when she supposedly, supposedly, an overseas citizen voting from Germany.

Now I'm gonna switch it up.

The city is out of control.

Too many, too much violence, too many crack and heroin houses.

Selling crack and heroin 13552 is shut the F down because I said so.

You cannot sell crack and heroin next door to my mama.

Now Nini, Nini, my friend, has to and must get what she wants.

So I'm taking the gloves off.

Nobody's gonna be on touch now.

I will touch everybody.

Do whatever I got to do to get that little girl what she asked for, requested, and deserves.

And I'm gonna show y'all.

Tomorrow I'm gonna make an announcement.

And all y'all are gonna be surprised.

The Detroit tapes are coming out.

I'm gonna put them out.

Thank you, and thank you for reporting that um the house next to your mother.

Um next speaker is D Dot Mobility Access Ambassador Cunningham.

Brother Cunningham, good afternoon.

You have two minutes.

Everybody under the sound of my voice.

Can you hear me?

Yes, we can.

That number was made so you can remember it.

And uh, you can Facebook cash out by using that number.

You can put in not enemy Detroit and find my page.

Uh I just need prayer that today.

Some people are very pessimistic and they're fearful.

I usually don't have too many parents in the world.

I ain't got nothing, but I don't.

I'm having a little gathering in my apartment.

Um, just talking about issues of the community.

People say, Oh, they're gonna bust your door in, they're gonna rob you, they're gonna take everything.

And I got nothing.

So I just want to uh help the community uh and hope it's success.

Every success is a prayer success.

And the Holy Spirit brings all things to our membranes, and there is nothing left after all that we work open and closing doors that need to be closed.

And without naming names, I want to thank those that are assisting me.

Uh please pray.

I ask you.

Um every single day during the week, uh, after 6 p.m.

and on the weekends.

The people mover is free.

Is not on time.

Why are people paying?

It should be free.

Paratransit and D Dot, or I make a reduction.

We know it's $25, $5 round trip.

And smart paratransit is three dollars.

Thank you, brother Canaham, and for bringing folks together.

I think we got um it kind of broke up at some points, but I think we got the gist of it.

And uh, I know you mentioned the paratransit cost and the ability to donate at our disability task force as well.

So we will be looking into that.

Next speaker.

We have three virtual speakers left.

Our next speaker is Chanel Manis.

Good afternoon.

You have two minutes.

May I be heard?

Yes, you may.

Awesome.

My name is Chanel Manis.

I wholeheartedly support the City Club's apartment CBD project and ask that you would vote to move this project forward um with a recommendation for approval.

I grew up in Detroit.

I graduated from Castech.

I earned my law degree from Cooley Law and I'm currently pursuing an LLM in tax from Wayne State Law School.

I recently moved back home from Phoenix because I love Detroit.

I want to contribute my professional skill set to this growth.

My peers, other young professionals, and folks who have not begun our own families yet.

We're looking for affordable modern living options like those at City Club Apartment CBD.

This kind of safe, desirable affording affordable housing is one of the primary persuasive factors that will keep us home here and not in other big cities like Chicago.

We want to live, work, and play in Detroit.

So I ask that you would please approve this project so we can do exactly that.

Thank you.

Thank you so much.

Thank you for your comment and welcome back to the city.

Um next speaker.

Our next speaker is iPhone 2.

iPhone 2.

Good afternoon.

You have two minutes.

Hello, may I be heard?

Yes, you may.

Great.

Well, my name is Shirley Winfield.

I am a Detroit retiree, born here in the city of Detroit.

Uh, raised in the city of Detroit, serve the city of Detroit for many, many years.

And and before I go any further, I do want to thank you, uh, council person and also council woman Mary Waters.

You guys have been pushing this retiree advisory task force, and we appreciate it because without you, we couldn't be heard.

And this leads into the point about this new initiative with this housing, the city club apartment CBD.

As you know, we as retirees need housing.

We need it to be affordable to us because we took cuts for many, many times, and now we're facing a big cut with our pensions.

So we want you to really move this project forward.

It's going to help us to be able to get into some places that we can afford.

That city club, apartment, CBD is on the horizon, and we just need you to support it and move it forward.

We thank you for all that you're doing for us for us senior citizens.

We couldn't do it without you guys supporting us.

So I thank you for this, and we look forward to seeing you next week at the at the meeting.

Thank you again.

Thank you, ma'am, and looking forward to seeing you at the task force meeting as well.

And thank you so much for your service to the city.

Next speaker, our last virtual speaker is Cliff Manis.

Good afternoon.

You have two minutes.

Good afternoon.

May I be heard?

Yes, you may.

Well, thank you for allowing me to speak.

I also uh listening to the comments recommend that the council move forward with the city club uh CBD initiative for seniors.

Uh a little bit about my backstory.

I am a 40-year retiree from Detroit Edison slash DTE Energy.

Uh I raised my family in the city of Detroit, a big supporter, and having worked on a number of projects in the new center downtown area.

I have seen where uh developments have come in uh from various entities and want to make sure that the number of safe and affordable housing units for uh senior citizens is increased.

Uh we've seen a lot of resurgence and wealth in the city of Detroit, and the the ordinary regular citizens of Detroit uh should be included and should have the ability to have safe and affordable housing.

That's my comment.

Thank you so much, sir.

Thank you for calling in.

And that brings us to the end of our virtual public comment, and we'll bring Mr.

Foster forward for public comment.

Um to remote.

Okay, all right.

Just wanted to make sure your mic is on.

Oh, yes, sir.

Can we restart this time, please?

Wanted to uh remind this body of his summers powers, right?

We cannot continue to do business as usual, right?

Last few years has been a lot going on.

I would ask that you guys audit the bonds.

Make sure that our bonds are appropriate, made sure that people didn't leave with city bonds here and trying to conduct business on the owner and different things.

We had to be accountable for people when they leave office right away.

Um we have to change our policies.

I heard some council members mentioned it was a little humor.

No romance, no finance with our romance, and it appears to be uh some truth to that, right?

I've watched our hood have issues the last few years.

Gentlemen get promoted with those funds after putting a new thing on the floor, and then get appointed to the Detroit Riverfront Conservancy.

So to be moving hood funds and be having all these things and then be sitting on boards downtown just doesn't make sense, right?

The city get deprived and you get promoted to do things, that don't make sense to me, right?

People have to show their work, show what it is that they've done to earn to get promoted, and then make a decision.

If you want to work for the city, work for the city.

If you want to be corporate and follow behind on people, then the people should hire you, right?

But if they ain't hire you, then I don't know what it is that you will have such an allegiance or loyalty to somebody on this tax period dollars in time.

And so that's where I'm at with it.

And when it comes down to these CBDs and things, you know, I went to purchase a condo downtown just a few months ago, right?

Everything was all good until I got to the HOAs.

$1,800 a month, right?

And so we have to do better in our management.

It's not just about endorsing things.

We have to audit folks, some as people be accountable for past things and know where we currently stand today with our finances and what we have the ability to do.

Thank you.

Thank you, Mr.

Foster.

And I'll definitely follow you up with you on a few of those items.

Thank you.

All right, that'll bring us to the end of public comment.

Um, colleagues, anything you would like to say?

We are good.

All right.

That'll take us on to unfinished business.

Uh 5.1 is a memo for uh resolution.

A member for my office request a resolution on Center Bill 559-560 on 561.

Um, this is still in limbo legislatively on the state level.

So can I get a motion to bring this back TBD?

Motion.

It's been a motion to bring back 5.1 TBD.

See no objections that action shall be taken.

That'll move us on to nine item 5.2, which is um from the office of auditor general, a citywide payroll performance audit.

Uh is there a motion to discuss?

Motion.

Motion to discuss 5.2.

Um, so if we could have uh folks from the audit generals and I believe we have folks um from the OCFO's office as well.

Thank you.

Good afternoon.

If you could just uh state your name for the record, please Kimberly Hall Wagner, uh Chief Policy and Planning Officer, Human Resources Department.

Good afternoon, Regina Greer, Chief Deputy CFO from the Office of CFO.

Thank you.

Good afternoon, Ray Roth, Director at Stout.

Good afternoon, Laura Goodspeed, Auditor General, Office of the Auditor General.

Thank you all so much.

I will I know we had a um presentation on this audit from the Auditor General's office, and um I know we have I know myself had quite a few questions that you all have uh sent back answers to, but um just wanted to make sure that we have this conversation in public and also to see um give the OCFO's office uh opportunity to share uh their views and also what steps have been taken um to solve some of the issues that were identified in the audit.

So um I'll turn over to you all to add anything that you would like to, and then we can open up for questions from members of the committee.

Thank you.

Uh through you, the chair.

The office of the CFO as well as human resources have taken the audit recommendations from the Auditor General and Stout.

Um we've taken that back, looked at it in more detail.

We've been working with the Auditor General, our payroll managers doing a deeper dive into the specific audit items um that they reviewed and their recommendations.

Some of the items we've actually been able to make some immediate changes, whether it's reporting um and system changes, some of them we're still going through, as well as um some that we are um walking stout and the AG's office through the detail, making sure that they understand um exactly what we're doing to ensure that we get agreement that those items may not necessarily uh need a change, that it's just more of an understanding.

So that process is in place uh right now.

Uh we know the city's uh payroll and uh benefits, salaries and benefits uh is over 50 percent of the city's general fund.

So we take that very seriously and they're working now with our auditor general and stout to ensure that uh employees continue to be paid timely and accurately, and we can answer any questions that you may have thank you so much.

Um for uh Madam A.

G or folks from Stout.

Do you uh anything to add there before we get into questions?

I I think we are in agreement uh with everything uh OCFO has said.

We have been working with the conversations are uh very positive, very uh productive.

Um the OCFO has been accountable and and and cordial, so everything um we would we would like uh we are open uh to receiving uh information um and we are going into those with an open mind uh as well and want to consider any information that that was not considered.

Uh I think maybe the the one thing I'll I'll add to be maybe a little bit uh constructive is you know we're the timing of it, uh you know we're appreciative that payroll has a day job and needs to to get people paid and that uh has to come first.

Uh you know, but it was two months ago uh almost now that you know we first gave our report.

Um it has been a year uh since we've we've shared our findings.

Uh we met last last week again, a very positive, very productive conversation.

There's some information that was shared that I said I would like to look at in more detail uh to make sure we're fully considering that we still have not had um and one of our findings that we shared when we were here two months ago was you know, even if all of our observations prove to be correct pay, everything is the way it should be.

There's a concern that it is taking this long to demonstrate and and document it.

Um and so I'll just reiterate the the timing of it, very considerate of the day job um and all the work that payroll does to get people paid.

Uh but I think everyone is anxious to get this resolved as soon as possible uh and end with very appreciative of the positive and um tone that the OCFO has taken and uh in our last few meetings.

Thank you.

Madam AG, anything else anything further?

Oh sorry, Madam IG, anything further.

No, uh just ditto what our partner uh Ray has just stated, and again, we are very appreciative with the OCO, OCFO being open to working with us and doing those deeper dives.

Uh, we would like to, of course, kind of speed it up a little bit, but again, we we are our appreciative and our will remain available to the OCFO as they work through the findings and recommendations.

Thank you.

Thank you.

Um, thank you all.

All right, we can get into questions and discussions.

Um, we can begin with Vice Chair Johnson if you have any questions.

Thank you, Mr.

Chair.

Um, and thank you to the OCFO's office as well as uh Stout and the Auditor General for joining us again to have this conversation.

I know we spoke uh previously about some of the uh changes that were being uh put in place.

I am interested in having a better understanding of the OCFO's office, uh, your role in overseeing or managing payroll staff that work within various departments throughout the city.

Uh through the chair, I thank you for that question.

The office of the CFO, we work with the other departments, whether it's uh 36th district, uh police, fire, um, who do have some of their own manager and staff that manage the payroll.

Um, so we work partner with them along with human resources, but they manage their time similar with DDOT as well.

Um, they are responsible for providing their time files to our payroll team and then their process for per payment.

We are in the process right now, the office of the CFO is in the process of looking at and drafting plans to see how we can more be involved with those departments so that we can have uh our own internal audit assurance that the files that are coming over are accurate as well as just timely.

Okay, thank you for that.

Um, because while we talked about making sure people get paid, I think for me is making sure that the payroll is accurate.

Um, and I think that's been some of the challenges that we've seen for a variety of reasons.

But I also think that if there is no agency that oversees all of the departments in payroll, that it becomes a bit of a challenge because it's department specific that's providing oversight and making sure that things are accurate.

Um, and I just think if there's no check and balance um within the OCFO's office or somewhere um within the hierarchy, um, things may get lost and and everybody may do things differently, um, but I think there has to be an agency that that captures or reviews everything to make sure everything is consistent across the board.

Um I know we've had some things come out within the media relative to payroll.

Um can you all talk about DPD's uh integration into AltiPro and how that may be may be able to address some of the challenges that we've had there because DPD has a significant budget that's the general fund dollars through the chair.

Uh the DPD's payroll currently for the sworn employees is all manual.

They do not use the city's time and attendance uh module where they're clocking.

So that portion is manual for the DPD sworn officers.

The DPD non-sworn, they are uh implemented and integrated into our uh time and attendance system where they are clocking and responsible for managing their punches similar to any other city employee.

We are in the process, the OCFO along with HR of submitting a contract amendment to this body for an extension and a um an improvement in our payroll software, where UKG, who's our current payroll provider, has a new module for time in attendance, which is improved that will allow us to move forward to allow for our police DPD staff to clock into ULTI.

So we're we're actually working to submit that to you in the next couple of weeks, where that amendment will come to you for that change where we will have a project plan in place to be able to improve our time in attendance along with that integrate um the telestaff, the hostage system, and as well, which is one of our primary goals to have DPD uhffers, sworn officers being able to clock, just like any other any other city employee.

Okay.

Yes.

So as I've stated, we are finalizing the draft of the third report in our payroll audit, and that is a public safety report.

It focuses squarely on DPD and DFD.

We hope to finalize that draft within the next two weeks, provide it to the OCFO for their responses and publish that.

We when we started this audit, we recognized that there were other sort of HR activities that covered specific departments, for example, DPD as well as City Council.

We chose to include the pre-payroll type activities for this body, specifically in the human resources employee services audit rather than specifically and necessarily in the payroll audit.

So we will have uh we have finished the field work for that particular audit, and so we hope to provide and address maybe some of your concerns as it respects to some of these other departments that are their payroll is not necessarily the uh under the HR citywide or the OCFO's direct involvement in our future reports.

Thank you.

Thank you.

And I I think that's where I'm trying to create some uniformity within the system.

Um because the city of Detroit has been around for a long time, and I know this is not new.

This is not a new challenge for the city.

Um so there has to be a way for us to get this figured out for a variety of reasons, right?

Um it becomes very frustrating when we don't get it figured out when we recognize the challenges that we have just as a fiscal entity and the the products and services that the city, the residents expect from us, um require from us, and and I think we require the same thing, right?

Um so I'm cautiously optimistic about the direction or or the thought or insight that we have, um, but it's kind of a tangled web, and we have to figure out how to untangle it, but I think there has to be some over site um that just kind of oversees and maybe reviews payroll for all of our departments, um and who's providing maybe some training, suggested training for individuals in various departments, um, and just making sure that we are on the same page, that we minimize the ability for folks to kind of go off script and do their own thing, right?

Because I think that's where you find the challenges.

So we're we're going to continue to delve into the report that we received, and certainly we'll have some suggestions that we offer, but would just really like to see some sense of normalcy across the board throughout the city.

Thank you.

Thank you, Russia Johnson.

Member War.

Just have a quick question.

Um how are we doing with um collecting from those that we do overpay?

Uh through the chair.

The payroll team does have a process uh in place where if there is an overpayment to an employee where that employee and their supervisor is informed, the depending on their con if they're in a union contract, there's specific requirements as to the length of time and the amount of payments that can be taken or deducted from the employee.

So that process is in place with a formal notification to the employee.

Okay, so but but they're generally pretty easy to collect once well.

I guess you can just take it out the next time if they don't, right?

Correct.

So it it's it's an easy process to collect, but we do it want to ensure that the employee is fully aware of what occurred exactly and what happened.

And it easy, is it easy for you to kind of catch it, you know, identify it when it happens?

Is that easy too?

Um I guess I wouldn't use the word easy, but but once it's identified, right?

Uh depending on what the issue is, um, the it it is for us to we have a process in place where we can, as long as the employee is still employed, uh, an easy process to be able to add that deduction.

Is there a system that you can use that can help you flag such a thing?

Is it I'm just curious.

Uh a system uh through the chair, a system to flag an error.

I'm sorry.

That that type of error it and and through the chair, I believe it really does depend on what the error is, right?

So if an employee um has time in the system and they may have been overpaid for something, once we are able to catch it, because the employee may catch it, the payroll team has a checklist of items that they go through before and after payroll where they compare previous payrolls to this payroll for employees to see that if you made $500 this week, you can't all of a sudden be making $2,000, right?

Where we're able to see those before payroll runs and and also additional checks after.

Oh so that's happening on a regular basis in terms of how you do the comparisons.

Okay.

All right, well, that's good to know.

Thank you.

Thank you, Mr.

Chairman.

Thank you, Member Ward.

If I may also add to that, uh, through the chair.

Um so I I agree the payroll team does a lot of checks and balances, uh, and those were some of the things that we observed uh through through our process of of watching those.

The the report that I offered to you, we did a lot of analytical procedures, uh, thinking of it as a risk assessment.

If there were overpayments to be made, how would those be accomplished?

And so either hours are overstated uh or rates are overstated, and those were the basis for some of our analyses and some of the recommendations that we offered to offer more vigilance uh how if there is overpayments, how how they could be identified.

Just one other, Ms.

Chairman.

Um, what about when it comes to tracking vendors?

Um do we have a system in place that's that's operational?

Um are you are you satisfied with that system?

Uh through the chair for the vendors, that is through the accounts payable system.

You don't have to do that at all.

I mean, it's just you're strictly payroll, nothing else.

So what the everything we've been speaking uh to have been strictly payroll.

However, um I am I am also responsible for the accounts payable team, okay, which is a different system.

Yeah.

The accounts payable invoices, the I would say the majority of the city invoices are required to be paid through a purchase order.

Yeah.

And there is what we call a three-way match for payments to be made where it has to be a purchase order, the invoice uh has to be valid, as well as the department approval confirming that that receipt of the goods or services have been performed.

So is it a pretty good system?

So it it in my opinion, it is a good pretty good system because that validation has to be there for the majority of the invoices.

Now there are some invoices uh just for clarity, whether it's utility payments, um check requests for um maybe food services, um, small dollar amounts that's under the procurement threshold.

Um there could potentially be training sessions and things where those would be non-purchase order payments uh that are under the procurement threshold.

Those types of items go through, but again, there's still a series of checks and balances, whether it's it starts with the department submitting the request, has to go through the Office of Departmental Financial Services, ODFS, who vets the invoice uh confirming the approval from the department before it gets submitted to accounts payable, who also does a uh a detailed review.

All right.

Let me let me just stay on vendor for a second here, because you know, oftentimes, and I know uh my colleagues have probably right into this, vendors talking about how they don't get paid timely, and they say it's so difficult for them to even do business with the city because it takes them so long to get paid.

And and when you have vendors who are smaller and and just can't afford to wait that long, uh what should we do?

How can we improve that?

The accounts payable process can be and should be very smooth for vendors because as long as the vendor receives a purchase order up front before the work is started, and there is a valid purchase order, they can submit their invoice, and the department should be able to once they submit when the goods or services are received or performed, the department submits that approval and it goes through to ODFS again for uh processing that receipt, and then the vendor can be paid according to the terms.

There are times uh depending on what the good or service is where it does take the department maybe a little longer to kind of vet it for specific if there's a lot of detail that has to go through.

The OCFO, we do work with the department.

Uh ODFS receives uh and gets daily reports of our invoices that may what we call on hold that we're working with the department, letting them know that there's a vendor waiting to be paid, and we track that uh and report on it monthly to our CFO Tanya Stademeyer uh so that she's very clear that it keeps us honest um to ensure that we're actually working to get our vendors paid.

Uh in addition, we are working with our ERP team to improve and have an internal uh into our UK uh MRP system into Oracle where we can have the vendors submit their invoices timely directly in Oracle and have the department visibility up front because there are times if a department if a vendor submits something to the department, we have no visibility.

So what we're working on now is to put that visibility directly into Oracle, our ERP system, so that we can report and now see exactly how long a department may have had the invoice waiting.

So that's in process as well.

We're hoping to have that done uh by the end of the year.

Do you find that a number of vendors just need technical assistance in terms of getting things submitted timely and properly?

Is that an issue?

Yes, there are times where vendors do have that that challenge.

Uh we work directly with OCP uh who has specific people assigned to contact vendors, and we often refer vendors directly there, not just to the video websites where they can actually contact someone directly in OCP uh through Sandra Stahl or Tony Lemmett, um, and we work directly with them and the vendor, we watch and monitor my team to ensure that hey, I assigned a vendor to this person follow-up to make sure that the vendor actually got what they needed.

Are they are they submitting through the new system now?

Um because I know Oracle are we facing out Oracle?

No.

Or is it gonna be both of them?

No, it's it's currently Oracle and will stay Oracle until their contract.

But but what's the name of the other system again?

Oh, the payroll system is UKG.

No, no, for the vendors.

There's another one.

I don't know another system.

Do you know I cannot think of the name of that system, but but but when when people um become registered, they register in another system now as well.

Oh, the supplier portal.

Oh, I'm sorry, I know what you're referring to.

Yes.

Um, I can't think of the name of it.

Yes, I know what you're referring.

My apologies, I know what you're referring to.

Through the chair, but but ultimately the goal is Oracle is the system of record.

Yes, and that is where the invoices have to live.

Okay.

Uh, through the chair to member waters, I think you were referring to bid sink.

Uh that was the previous portal, but now I'm talking about there's a new that there's a new system when vendors have to register.

Um maybe somebody is listening.

Ms.

Mr.

Corley, do you know what the system is called?

Do you miss the chair?

Mr.

Coral.

Mr.

Chairs, I think it is the um is the portal.

The supplier portal.

The supply portal in Oracle.

That no, that's not the but okay.

Maybe maybe you know, I'm I'm gonna text direct uh Shaw and ask her because I I can't think of the name of it.

You can't I'm yeah, I'm gonna tell you why it's so critical because recently they they they put a bid out and um the people did not receive it because they had not they were only registered in Oracle, but they had had not registered in the new system, so they they did not receive uh uh the invite to bid on a on a uh on a service.

Through the chair, I believe that would be bid sync, but um I may be mistaken.

Member Johnson says no, she knows it's not that way, she can't think of and and and through the chair, we can follow up with the office of uh contracting procurement and provide a response back for what that is.

Yeah, I I just wanted to make sure that all of the the our our vendors who who submit um application to bid on certain services and whatever that they are uh that the both systems are working for them and um and I just can't think of the name of it.

So all right then.

Well, this it's all good.

I find out before you finish, Mr.

Chairman.

Thank you.

Thank you, Member Waters.

Uh so just a few questions from uh myself.

Uh on the for the as you mentioned, um deputy CFO, um the movement of DPD.

I know you said there's a um contract amendment coming.

It does is there any issue with the uh DPD uh labor contract with doing it or anything that needs to change with that to get them on to that system?

Uh as of right now, to my understanding, there is nothing in our current bargaining unit contract that precludes the city from uh requiring the DPD sworn officers to clock.

We have had Tanya Steidemyer CFO has had conversations with the chief, and um so he he is aware of it um and had no issues um as to to my understanding so that that communication is ongoing.

We're working to establish a DPD project team, so all of that uh is in process.

Oh thank you.

Member Wards, yes, it is bonfire.

It is bonfire.

So that is the new vendor portal for the office of contract and procurement.

Thank you.

So that is where they're putting their bids.

Thank you.

Um and also I know in um some of the information you got all to us.

I know one thing for folks, and I think this is important, especially for uh the public to be listening to is that um the committee will get quarterly updates on the implementation of the um recommendations and um I know we talked I know there was questions about time and know there's a lot of internal things between um the OCFO's office, uh HR and the Auditor General and folks at Scout.

Is the idea is the thought that all of this will be uh implemented by the end of the year?

Is that what we're thinking?

Uh to the chair, um our goal is to have everything implemented before the end of the year.

There may be some items as we're going through our um bargaining unit agreements would need to be tweaked or MOUs put in place, but uh without that exception, uh everything else our our goal is to have it done before the end of the year.

And yes, agreed uh quarterly reporting back to this body uh done.

Thank you.

Um that is the that's uh my questions were covered uh throughout.

Uh any additional for my colleagues.

Any uh additional comments from uh folks joining us.

Oh, yes, sorry about that.

Mr.

Corley, anything from you?

All right, thank you.

Uh Madam Edgey.

Just through the chair to this honorable committee.

I want to thank you for being diligent and following up on our recommendations that says to us that you find them value at, and that's what we strive to do.

Thank you.

Absolutely, and I I appreciate that.

I I want to thank you all.

Um, as we think about the audits and and such, I think it is useful, of course, in ensuring that we find any um things that need to change and and make sure that we are doing as best as we can as public servants and as uh folks that have to handle our tax dollars and folks that we've been to trust uh uh to handle that.

So I do want to thank you all and also for working diligent to um address the issues and also come together to address this because at the end of the day we just want everything to be as um to work as best as they can.

So I thank you all, and we'll definitely have further conversations.

So thank you.

Thank you for joining us.

Thank you.

With that, is there a motion to receive and file 5.2?

Motion.2.

Seeing no objections, that action shall be taken.

Thank you.

Okay.

Moving further along in the agenda.

5.3.

Is a memo from Member Benson's office relative to data center tax revenue impact analysis.

Is there a motion to discuss?

It's been a motion to discuss and just defer to LPD on this one.

Thank you, Mr.

Chair.

Please bring this back in three weeks.

We appreciate it.

All right.

Is there a motion to bring back 5.3 in three weeks?

Motion.

It's been a motion to bring back 5.3 in three weeks.

Seeing no objections, that action shall be taken.

Um we will take up 5.4.

This is from Vice Chair Johnson's office.

A memo relative to request for information regarding how public safety fees are calculated for large events.

We have received these answers.

See no objections that action shall be taken.

Um for 5.5 and 5.6.

These are memos regarding the media services budget from myself and member Miller.

These have been received.

Is there a motion to receive and file 5.5 and 5.6 motion?

It's been a motion to receive and file 5.5 and 5.6.

Seeing no objections, that action shall be taken.

And moving to 5.7.

This is a memo from Member Santiago Romero's office relative to the building of free fair pilot.

This has been received.

Is there a motion to receive and file 5.7?

There's been a motion to receive and file 5.7.

Seeing no objections, that action shall be taken.

This will take us on to 5.8.

This is a um status of housing from the housing revitalization department, a city club apartment CBD, uh located at 505 1501 Washington Boulevard payment in lieu of taxes.

Discussion.

On if you could just state your name for the record.

Good afternoon, Rebecca Labove, Housing and Revitalization Department.

Thank you.

I just have one thing because I it did come up on public comment.

Um, but I if you can just give a just a quick overview, and I know you probably have uh discussed it before, and I see more folks join if they want to introduce themselves for record as well.

But just the how this does impact would you all see the impact of city funds and and the tax base and such with this uh project.

And for the folks who are joining on screen, if you can just intro yourself for the record as well, Matt Walters, Walters Group.

Uh Jordan Sasson and SQL Companies, Liz Rogers, legal counsel for the developer, Tas Tinius and Hollister.

Jake Ostring, plant man real point here on behalf of the developer.

Um and and to the chair, I will um provide a preliminary response on your first question.

Although um I would note we may have colleagues from the DEGC who would also be well positioned to speak to this, and I'm not sure if uh David Howell is available to be promoted.

But um, within the Ms.

Labov, one second before you move forward.

We have another colleague that's joined.

If you want to come forward, thank you.

Good afternoon.

If you had just introduced yourself for the record, Michelle overholder Zimmerman and HRD.

You'll have to um sorry about that.

Michelle overholds your Zimmerman HRD.

Thank you.

Uh Ms.

LeBeau, you may proceed.

Thank you.

Thank you.

To the chair.

We worked with the DEGC since this item was last before this committee for discussion to conduct a cost benefit analysis that showed a pretty significant net benefit to the city based on looking at you know the potential revenue losses, but in addition, the um benefit to the city through um, you know, additional income tax and tax base.

We worked with the DEGC since this item was last before this committee for discussion to conduct a cost benefit analysis that showed a pretty significant net benefit to the city based on looking at you know the potential revenue losses, but in addition, the um benefit to the city through um you know additional income tax and tax base um and you know generally I think I also want to state that we as the housing and revitalization department see enormous benefit to stabilizing and um you know preventing a a foreclosure and displacement event at an occupied building a large occupied building um in the heart of downtown and so that's really the primary benefit um that that we see that I just want to make sure to state clearly thank you um anything to uh from folks all right um member waters and then we'll go to Mr.

Corley Waters Oh okay all right so there's just one main thing this has been troubling me and that is setting precedents do you we see similar situations coming um down the pipeline for other developers they say hey we did it for this group we need the help too and the list goes on and on how do we prevent that that's what that's what I need to know because we're talking about fiscal responsibility here and we know we can not afford to do it for everybody so so what are we gonna do um how are we going to handle that when another developer comes before us is going to happen I'm sure of it and has anyone already approached you that's already in the pipeline here through the chair to council member waters um when city council passed the pilot ordinance update in late 2024 um that was a unanimous approval to allow for some projects that offer deeper affordability to move through an administrative approval process but it also allowed for this expansion of the pilot to support workforce units that are affordable to um that 80 to 120 percent of AMI range and the ordinance considered that these projects would be brought in front of council so that each one would be considered but it was certainly the intent of um of the administration and also the state when they enabled this update to municipal ordinances that we would be able to support more of these units.

The the reality in the market is that those units also need tax relief um and we also knew that many of them that had previous uh traditional tax abatements like NEZs or the PA 210s would be reaching the end of those abatements which we sometimes call the abatement cliff um and would not be able to operate if they were uncapped um if they were sold and were faced with an enormous tax increase that those rents still can't support and so this this ordinance and and what is before this committee here related to this project um is very much aligned with the design of the ordinance and the intent which is for us to be able to um preserve in this case and in some cases create units that are affordable for that income range um and to support these projects that may be coming off of previous uh tax abatements we do have uh six other projects that are in the pipeline that we are evaluating through our underwriting for the workforce pilot um they are not uh in the same kind of financial situation as this project so I don't think you can say that you know they're gonna replicate the same fact patterns but like this deal they are um serving to preserve the affordability and um we would be working with them to keep residents in place and restrict those units for the term of the pilot and so we do anticipate there will be a future pipeline but um we see that pipeline right now along with this project very much aligned with the intent of this ordinance to create and preserve workforce housing well you know I was one of the sponsors of the of the ordinance co-sponsor so I know what you're talking about so um what about that place down on Lafayette is it also is it in the pipeline too you don't know what I'm talking about um through the chair are you referring to this the city club apartments Lafayette no no project on uh East Lafayette is right across um kind of kiddie corner to Lafayette Towers perhaps if you if you look at it right at Lafayette and um say Orleans those uh new buildings they relatively new anyway for sure I mean have they approached you because that's my understanding that they're having some extreme difficulty so I I'm just curious to know right now if that is if they are one of the ones that are in the in the pipeline through the chair Rebecca I can handle that thank you through the chair we do not have any applications for pilot that meet that description whether you're talking about the workforce pilot or more broadly the the fast track oh okay all right I well I was just curious and so well we shall see we shall see um

Um the chair Rebecca, I can handle that.

Thank you.

Through the chair, we do not have any applications per pilot that meet that description, whether you're talking about the workforce pilot or more broadly the the fast track.

Oh, okay.

All right.

Uh well, I was just curious, and so well.

We shall see.

We shall see um how this turns out uh for us, Mr.

Chairman.

I don't have any other questions.

That was just I was just concerned about you know us trying to help so many others in the fact that whether or not we could afford to do so.

So thank you.

Thank you.

Thank you, Member Wards.

Mr.

Crawley.

Thank you, Mr.

Chair.

So um regarding Council Member Waters' concern, you know, in our report, and in fact, our report on the cost of benefit analysis is 996.6.

And so, you know, we understand that there's definitely a demand for workforce type uh units, you know, uh income uh has increased in Detroit in some industries.

Um we know there's a lot of economic development going on in this city, you know, um Henry Ford Hospital and others, and so there's definitely a need, you know, for workforce units.

In fact, there's a there's a there's a uh short shortage of units uh available right now in the city of Detroit.

And so this is a great um example where you we're taking uh an existing building and it's in fairly good shape, but it needs to be um refocused, you know, for workforce type um units.

And so we do recommend in our report in line item 6.6 that for the um projects that's in the pipeline, the six projects that's in the pipeline for the pilots, that they also uh provide the DGC in particular provide a cost benefit analysis.

That gives council a greater assurance that there's a net benefit, you know, for the city of Detroit.

And this project here is about a 4.5 million dollar um benefit, net benefits city of Detroit over the 15-year period pilot.

Um the net present value is three million.

So that's that's pretty that's pretty good.

Um so we also suggest that for future projects that the developer provides, you know, what is the rate of return and what is the debt service coverage, you know, with and without the abatement.

Because for this one, um there's a positive rate of return.

It's about three percent, four percent rate of return on this project.

Without it, it's a negative uh return.

And so that would be unacceptable, you know, to the developer.

And then when you're looking at debt service coverage, you're looking at you know, what's the ability of the um project's income um uh operating income to cover debt service because you know there's gonna be a loan associated with this type of project.

And for this one, the debt service coverage with the abatement, the party of abatement is uh 1.2 coverage, which means that the project will have some cushion to not only make payments on the debt service, um, principal and interest payments on the any loans outstanding on the project, but have you know additional money uh uh for other operating expenses without the abatement, um they'll just be barely meeting their debt service coverage, and and that's not a good thing as well.

But um we we concur with the memo that um the housing revitalization department put out on the cost of benefit analysis.

Um we looked at the uh assumptions that were used to estimate you know the revenue the income tax revenue.

Um let's keep in mind that there's right now 12 existing uh maintenance people on this project.

If this project moves forward, it could be additional 28 new jobs, you know, uh created from this project.

So that's a good thing.

Um and I really like the developers um heroes, it's called uh it's called the Heroes, uh yeah, housing for Heroes Plan.

And hopefully other developers can replicate that as well because this developer is making a concerted effort, including the city of Detroit to work with employers, city Detroit employers and other employers to reach out to individuals that are making you know workforce type um income and that need affordable units.

Because right now, um there's there's a there's a lot of projects that are under 80 percent AMI, and they're highly subsidized through the federal government or through MISHDA.

But for this type of project, you don't get that large subsidy from other agencies like the federal government or MISTA.

So the developer needs this abatement to again provide units for this workforce type um worker.

And so that's basically in a nutshell what we're saying in our report on um line 906.6, we do recommend that council you know um look at favorably supporting this project, and we're hoping that for the future projects, and that's in the pipeline that other developers will provide the same level of details.

You know, you all ask some wonderful questions, you know, council members on this project.

We have some additional questions, they responded to all those questions.

Um so we would like the same type of detail provided city council for future projects that's in the pipeline to give council a greater you know uh comfort level to support an abatement for these type of projects.

So we we we appreciate um um you know council considering this project.

There's there's a need.

And and because if if the project were to go into foreclosure, you know, as you know, the developer is purchasing the project or the building at a receivership.

If it were to go into foreclosure, it can have a uh a very negative effect on property values um in in the in the area, you know, in the city of Detroit.

So we don't want you know, I suggest we don't want that to happen, you know, as well.

So thank you for the for the comments, opportunity to give comments.

Well, uh through you, Mr.

Chairman.

Thank you, Mr.

Crowley, member order.

I just want to thank Mr.

Courley for breaking it down uh so well uh because we have members of the community who are listening who are very concerned as well.

So certainly appreciate uh the fact that you took the time to break it down.

Uh and when you use the word workforce, of course I'm always concerned about that.

I've been talking about that since I arrived on city council.

And uh, and I know I've heard Mr.

Chairman here talk about we're using uh union employees um to work on these various projects.

And so um I don't know if they said that or not yet, Mr.

Chairman, but um I'm assuming that they are.

I'm sure you ask them if they're not.

So thank you so much.

Thank you.

Thank you, Member Waters.

Um, and thank you, Mr.

Corley.

I do two questions for me.

Um I do always ask that question about the labor that would be used on any type of um upgrades or construction or such um for the developer team.

Are do you all plan to use union labor?

Uh to the chair, the uh properties currently managed today uh by uh a third-party manager, Village Green.

Um the properties uh is uh substantially complete.

There's real no uh no work that's contemplated to happen at the property uh uh you know at this time.

Uh and so uh you know, the all the staffing is done through the uh third party management.

We do not operate the management on our own.

Um and I believe that uh I I do not uh know exactly what the hiring practices are per se for village green, but I do believe that they operate in uh kind of a merit way and and do bid out the work uh to uh various uh all their work to to different um union and non-union uh companies.

But but moving forward, if there are any, you know, over the years, if there are uh construction projects that take place, uh union contractors will be prioritized.

Okay, thank you.

Um and member Waters, you brought up as we talk about the term of workforce housing.

I know it's come up as a question.

Um, just for HRD or whoever wants to take it.

When we say workforce housing, if you can just explain to folks who may be listening, what do we mean by that?

Sure, to the chair.

Workforce housing in um the way that we use it uh in the context of this program is not talking about people who are in particular industries, but more so people who are in a particular income range.

And so um right now that ranges from um a little under $60,000 a year to under $90,000 a year for a single person household and uh for a uh two or two-person household, $67,000 per year up to about 100,000 per year.

So typically it's called workforce housing because within that salary range are a lot of those folks that we typically anticipate or associate with workforce, meaning you know, police, firefighters, teachers, um, paramedics, folks who are really working um to serve Detroiters and who need affordable housing, but they may make more in in these cases than can be supported by our traditional subsidized affordable housing.

So they're just over the income where they could access the low-income housing tax credit units, but they uh don't make enough to you know be able to afford um the highest market rate units, and so this is what the program is intended to support to make the rents affordable for people in those income ranges.

Thank you for that.

And you know, I think when we think about when we talk about affordable housing, I think it's needs to be affordable for many folks, and especially in that price range or that uh salary range, because if you're thinking about housing where it's supposed to be around 30% of your income, um that is still uh without if we think about this is just talking about just the gross pay, um, that is still around 1,500, right?

For the the lower and probably lower once you take out taxes.

So that is definitely a need as we think about affordable housing across the city.

Uh any other questions from folks?

Vice Chair Johnson.

Thank you, Mr.

Chair.

Um, thank you all for the responses to the questions and for the numerous conversations I've had with several of you.

Um I do have a couple of questions for the developer in particular.

Um first I actually want to just make a comment and a request to HRD as well as the DEGC when I look at this project, not looking at what's in front of us today, but thinking about the developer who actually built the pri the property and what things that we might be able to do differently to avoid prevent us from being in the situation that we're in.

I know there are some unique things that probably took place with this particular development project and the developer, but I am asking that the DEGC and HRD ask some very specific questions for developers that are in front of us who have development projects already online in the city of Detroit.

If we can understand their occupancy rate um before supporting a new development project, that would be extremely helpful.

Um if you all can understand and delve deeply into whether or not any current development projects they have online are um still profitable for them, that would be good information to know.

What I don't want to have happen is um we see opportunities, and I'm not sure if folks looked and said, oh, the city of Detroit is doing great um, particularly downtown, you know, people have a greater interest in downtown, and so we're going to develop, develop, develop because there's an anticipation that folks are moving to downtown while we know there's a shortage of units um that are being requested.

Where are people going?

I I think we need to do some data searching.

We need to have a better understanding of where people are going, where they're interested in going, um, who is actually moving into the city while we have jobs that are coming online, and we have a desire for them to live in the city.

Are they actually looking and interested in living in the city?

Is that downtown living?

Is that apartment living?

Is that single-family housing?

Or condo, you know, like we I think we need greater data to understand what it is that we're doing, the direction that we're going, and then I think it helps us to make decisions on development projects that come before the city.

So I've requested that we've talked about that.

Um, I think that is very important.

Um I also want to make sure that as a city that city council has an understanding of the types of housing that are being developed as a whole.

City council sees a percentage of development that happens in the city.

We don't see the Detroit Housing Commission work that they're doing.

Um we may not see lower AMI units that are coming online, and so if we're only seeing 60 to 80 percent AMI or 80 to 120% AMI, we have no real sense of what's being developed throughout the city.

If HRD can provide that, it would be extremely helpful.

I know when we originally were evaluating the pilot ordinance, I believe there were there are limitations on the AM the number of units that are developed at any particular level of AMI.

Can someone share that?

Through the chair, um, you're referring, I think, to what we know as the CAP.

So the CAP restricts the number of units that HRD can administratively approve in a given year without additional authorization from the administration.

And the CAP applies to uh fast track housing projects.

It does not include government-aided housing projects, which were traditionally part of the pilot.

It also does not include new construction.

Uh we are currently proposing some changes to our administrative rules, which would not alter the number of units subject to the CAP, but which would exclude projects like this which need council approval.

So in that case, the CAP would only refer to actions HRD is taking without council action.

Um and last year we met the CAP at the end of the year, and this year we're on track to meet and exceed it earlier in the year.

And um I was gonna say one thing, just to be clear, it refers to approvals, which is distinct from the pilot going into effect.

So many of those that were approved last year didn't take effect this year, but some did.

Okay.

Um so that's really good information for us to have.

What has been approved administratively, how many units um at what level of AMI?

Um, I think that helps us to understand again where we are from a housing perspective.

Um, and I have been asking for us to look at data to determine what it is, what type of housing, what um AMF AMI level of housing um we actually need in the city to help us make decisions on what's coming before us.

If we need 30 to 60 percent AMI housing, what are we doing to develop that to support that?

What tools incentives are we using to help encourage that as well?

So I think if if you all can provide some some data to us, that would be extremely helpful.

To the developer, the developer, Mr.

Sassoon.

Um, you indicated um the management company that's currently managing the project.

Are you looking to identify a different management company moving forward?

Uh, through the chair, uh no, the the management company that is in place today, Village Green, um, was uh put in place in uh uh by the receiver uh and uh we would uh we intend and and very much intend to keep them in place.

They've done a great job stabilizing the property um and uh building good resident rapport and and uh improving um uh the kind of state of affairs on the ground.

And so uh we are uh working with them uh obviously during this contract period uh with the receiver uh managing kind of through the contract the um uh the property and understanding what's going on there to ensure a successful transition into this new program uh hopefully with your support.

Uh and so we have every intention to keep them in place.

Mr.

Sassoon, are you aware of a relationship between the management company and the developer of the property?

The uh the original developer of the property.

Yes.

Um I am not aware of a relationship between uh them.

There is uh there is a lot of history with the original developer.

Um I am not uh the most uh in the know about the the history per se, but just to be clear, it is uh our understanding that uh while the developer used to have um a role with the management company that um that that there was a formal split uh many yeah many many many years ago.

of a relationship between uh them there is uh there is a lot of history with the original developer um i i am not uh the most uh in the know about the the history per se but just to be clear it is uh our understanding that uh while the developer used to have um a role with the management company that um that that there was a formal split uh many yeah many many many years ago the company the management company is completely third party has nothing to do with the developer to our understanding and the developer's own management company which was called city club management um was removed from the property and replaced with this third party company and so um uh it is uh uh our uh firm understanding that there is no relationship whatsoever and if there is a relationship obviously we would never keep them involved but that is um uh we are uh in strong belief and opinion that that is uh that there is no uh relationship there whatsoever okay I'm going to look a little further into that because the information I received was uh different um but you also indicated that it is the equity um holder that identify the development company so would you be in a position if you were moving forward would you be in a position to um change the management company yes but just to be um the uh through the chair the answer to that is yes um uh all of the capital sources are fully aligned including us on ensuring that uh any prior relationship uh it does not continue uh going forward uh I will add a little bit more color um so it's helpful as you do um some additional research on your end um to my knowledge um decades ago the development the developer go by a name uh of a village green that business uh was spun out and sold um to a third party and the developer rebranded under a name called city club apartments that is why all of the properties that they develop and also the management company is called city club so you have City Club CBD you have City Club Lafayette you have the other city club one and adjacent to this one on along Washington in Cincinnati there's a city club in Minneapolis is a city club they developed around the Midwest generally speaking under that name and that flag and and self-managed their own properties under City Club management and did not hire Village Green.

Village Green was as I said again was sold off it is owned um to our understanding by a third party today that is completely unrelated and has been for many years.

We are happy to provide some additional information and get that through um the through the manager to ensure that what I'm communicating what has been communicated to us is is accurate uh but you have our word that we intend uh to operate the property with no connection to the past okay all right thank you thank you Mr Thank you Vice Johnson um I would also uh I want to go back to what Mr.

Corey mentioned and what they outlined in their analysis um and this is for HRD uh are we are we good on the request for um both the cost benefit analysis and also the debt service coverage and return uh rate of return for the upcoming uh for any further pilot that comes before city council are is that are you all able to provide that as we consider those chair yes we can um make that request working with the EGC I just want to be clear that it was their their team that provided that analysis and our team that did the initial underwriting um but we're happy to share the reports of you know from our underwriting which would include the debt coverage and um make that request to DEGC and I'm confident that they will work with us on it.

Okay thank you thank you for that and we can definitely be sure to make sure that it gets the DEGC as well.

And then I also want to mention um hearing that uh the going back to the question on union labor understanding that there is a management company that may have a mix of union on union I think overall as you all um if this is to go through and you all come into uh this property I know you talked about the residence rating and having a good experience I also just want to make sure that this management company is paying wages that um are in line and that our uh living wages because I also have the view that especially if this is workforce housing that the folks who work at a um property that's workforce housing should also make enough to live there um and we see that there's often with union uh wages as well so I just want to lift that up um but also I think this is the overall question and I can it's kind of come up a little bit but um this is for HRD um between the Leland the City Club the six upcoming workforce pilots um has the administration and you kind of maybe touched on this before but has the administration been began evaluating what has led us to here how and how we fix it moving forward so we don't continue to have a burnoff of abatements that then necessitates more abatements.

Um between the Leland, the City Club, the six upcoming workforce pilots.

Um has the administration and you kind of maybe touched on this before, but has the administration been began evaluating what has led us to here how and how we fix it moving forward so we don't continue to have a burnoff of abatements that then necessitates more abatements.

Um and I actually knowing that Detroit has the highest property tax rates in the state and and costs have gone up between tariffs, unnecessary wars and inflation.

But is the is that part just uh aspect is that we just need to bring property taxes down, um, or what is that analysis?

How's the analysis started?

To the chair, um, I I won't speak for the whole administration, but I certainly think our property tax environment is um you know it creates the need for these incentives, and so if that does not change, we will continue to be you know working on these incentives to ensure that we can develop and preserve affordable housing.

Every type of program that we use, whether it's you know, full subsidy or uh vouchers or low income housing tax credits, always comes with some expiration period.

And since 2018, HRD has established a team specifically working on preservation.

So we look at projects that have been restricted as affordable that have an expiration date approaching, and we work proactively with the developers and with our partners at HUD and NISHTA to try to get in front of that.

Um and we've been very successful.

Um to date, we've preserved over 12,000 affordable units that were in that position.

And so these tax abatement projects are you know, they're a bit different from the um deeply affordable units that that we typically work on, but it's really the same the same idea is that there was a program put in place, it provided some affordability, um, and we want to work on strategies to extend it.

And so the pilot, because it is renewable, uh, certainly buys us more time, but you know, we'll we'll always get to a point where the restrictions expire, and you know, we we want to ensure that we have the right kind of tools and incentives to bring the developers and the owners to the table to extend that affordability, and that's something that um is really important to our department and that we've done really successfully.

Um, and we're happy to have partners um like Mr.

Sassoon who is here who are willing to do that and are committed to the affordability long term.

Uh sometimes it's easier than others.

Um, but you know, we we do anticipate there'll be more projects that are just reaching the end of their abatements.

Um that you know were underwritten under very different economic circumstances that will need these pilots, and that's why we have that tool now uh to serve those projects.

I will note that um I'm aware that DEGC has made you know some changes to their underrating to sort of try to account for and um prevent as as drastic of an abatement cliff uh going forward, but we do still use those tools.

Um they're important for um making developments happen that are bringing value to the neighborhoods, and you know, I will just say that we're really committed to monitoring those closely throughout their compliance period and and the life of the affordability and ensuring that um we're working as proactively as possible on strategies at the back end um so that we can extend the affordability and and keep their properties in good shape.

To the chair, may I add to that?

Um I do believe that while all of the other cost environments that you alluded to are factors that essentially it is the high millage rate that is going to create the continuous demand for this, particularly at any transaction where the taxes would uncap.

As we see every year, great headlines about equity rising and assessments increasing.

Um and there's been a lot of focus on that accuracy of assessment, but as values do rise, the high millage rate just becomes that much more impactful, and we will continue to have this opt-in environment where you have to get hope for individual low-income homeowners and pilots and abatements and things like that for the um especially properties that are high valued in downtown and such areas just to make any transaction feasible.

And so I do believe that that is an underlying cause here.

Thank you.

Thank you both for that.

And I say this time and time again at this committee, especially for residents that are listening in.

Um if you have some time this afternoon, uh please do call your state rep and state center and let them know that we need to the tools that we can we need tools to be able to bring down property taxes here in Detroit and find revenue from other places.

Um and this is the election year as well, so um doesn't need a conversation.

All right, um justin wanted to add that.

Vice Chair Johnson.

Thank you, Mr.

Chair.

Just one brief uh question, and I may have missed this uh when you all started.

I believe previously there was a discussion or commitment to ensure that any residents that are currently residing in the property would not get displaced.

Um I am seeing a um higher rent in the workforce housing um for the studio units.

Um I know that there are also some maybe lower uh priced units that are tied to the NEZ, I believe.

Um so can you just confirm that no one who currently lives there will be displaced despite um the allowance for a higher rent through the chair?

I let the developer uh add to my comments, but I'd like to speak to the contents of the tenant retention plan for this property.

So, regardless of the specific restriction that will be in place for a given unit, if a tenant is a low-income legacy tenant, that would be someone whose household income is 80% AMI or less, they are not really subject to the restrictions imposed by Mr.

Mishta.

They are subject to further restrictions based on their income and or current rent because construction is complete in this property.

The developer has committed to increasing rent by no more than three percent annually through the duration of the tenancy.

The tenant retention plan also has a right to remain component, and so even if you have low-income legacy residents that are in a unit that is now restricted at 120% AMI, they will never reach that ceiling, they will be um only increased relative to what their current rent is.

The other thing I'll add is that there may be a scenario where a current resident ultimately is displaced if they were having an income in excess of 120% AMI, and if there were no available market rate units, we did bake in some time for income qualification to allow for the high volume of legacy residents to income qualify, but at the point of income qualification under the state law, they can't remain in a restricted unit without being out of compliance, so that could occur eventually through the chair.

The only thing I will ultimately add to that, um there is 83 low-income legacy qualifying residents.

Um, and that's residents that are either occupying an 80% AMI unit currently or have an income below 80% AMI, and to Michelle's point, they will have rent limits for the perpetuity of the abatement.

Um, in addition, the the uh dynamic that Michelle mentioned on non-income qualifying residents, meaning uh residents that have uh incomes in excess of 120 percent AMI.

Um, that is the the purpose behind the continued inclusion of an NEZ component in the property so we can have some market rate units that as we restructure this asset.

Um, you know, we are able to retain those residents.

Thank you.

And I believe the three percent is baked into the pilot ordinance, right?

Correct.

Okay.

Um, so let me just make sure I'm getting what I need.

Um speaking specifically about the lower income um residents that are there today.

Can you all confirm or deny?

Can you confirm that these residents will not be displaced as a result of the pilot going into effect?

Yes, and that would be for the term the length of the pilot, which is currently 15 years, correct, and any renewal periods thereafter.

Got it.

All right, thank you.

Thank you, Mr.

Chair.

Thank you, Vice Chair Johnson.

Any further questions, Chairman?

Uh I I don't have a question, but I certainly appreciate the question that um Madam Vice Chair Johnson did ask about pushing others out.

And um so I I don't want to be at a meeting, a community meeting, and have someone tell me I've been pushed out because I'm gonna be calling you for sure.

Okay, thank you.

I appreciate that question, Member Johnson.

Yeah, I'll echo that.

Thank you.

Thank you, Member Wars.

Thank you, Vice Chair Johnson.

Is there a motion on 5.8 motion to send line item 5.8 to formal with a recommendation to approve?

There's been a motion to send 5.8 to formal with a recommendation to approve.

Any objections?

Seeing none, that action shall be taken.

Thank you all so much for joining us.

Thank you for having us.

Thank you.

Thank you.

All right.

Thank you.

Thank you.

All right.

Have a great afternoon.

That'll take us on to new business.

Take us on to do business.

If we could actually take up 6.1 through 6.3 together.

This is from the Office of Contract and Procurement.

6.1 is a resolution authorizing contract number 600 7.66.

Uh 100% city funding to provide MRO and safety items for the city of Detroit.

Contractor is Granger located on Lafayette in Detroit.

A contract total amount of 6,750,000.

And this is citywide.

This is citywide contract.

For 6.2, this is contract number 6007 665.

This is 100% city funding to provide MRO and safety supplies for the city of Detroit contractor is MSC Industrial Supply located in Lavonia.

This is for five years.

Contract total amount is 6 million.

This is another citywide contract.

And 6.3 is contract number 6007 664.

100% funding to provide MRO and safety items for the city of Detroit.

Contractor is Fastenal Company located in Frazier.

Total amount is 2 million.

Again, a citywide contract.

Is there a motion to discuss 6.1 through 6.3?

Motion.

Who do we have on for this?

All right, if we can promote Arnita Clark, please.

Good afternoon.

All right.

So I see that we have one Detroit-based company.

If you can go through the type of material materials just for the public to know what type of materials are covered here and the outreach made to suppliers, especially Detroit-based.

Through the chair.

Yes, ma'am, no worries.

If you can go over what type of materials are involved in this uh contract, uh in these contracts, and also the outreach to vendors with the request for bid, especially Detroit-based companies.

Okay, great.

So the type of materials is um primarily materials.

Um such as your hardware things that the city of Detroit various departments would need to um keep their structure going, such as um screws, um metals, metal items such as screws, um your tools, um types, fasteners, anything that you could possibly get, like you can purchase from Home Depot, those are the MRO maintenance repair operational items that is covered with these contracts.

Um, do you need more detail regarding the types or is that sufficient for you?

That's sufficient.

Thank you.

Okay.

In terms of the outreach, I know um it's my understanding that this was um socialized.

Um, and also that um this was sent out to multiple vendors in UNA requesting um requesting their participation for the bids.

And for a couple of we did receive multiple responses for um one of one we received several responses, another one we received five, and the other three.

And this was provided to vendors who may have had a Detroit address as well as it's a it was open to the public as well.

So it was not restricted to only Detroit companies, but um a communication went out to um for all suppliers to participate in this item.

And it's my understanding there was also um a um there was question and answers that people who was interested would be able to supply their questions um regarding the solicitation.

Okay, thank you.

Um member waters.

Thank you.

Um they uh supplying the same type of supplies.

Each each the three companies are they supplying primarily the same thing?

Primarily, however, there are some differences.

Granger is um the materials and safety, MRO, in addition to firehouse furnishing.

That is something that Granger has on their contract or that they're able to provide that the other two were not able to provide.

MSC, they're also providing materials, the MRO as well as the safety supplies, as well as FASNO.

However, FastNow only has um they don't have a large assortment in their inventory like FAS like um MSC and Granger.

So that's why um FastNote contract value is lower because they do not have the inventory that the other two has, and Granger has the most because they're also providing um items for firehouse furnishings.

Oh, so if Granger has the most, why didn't Grage Granger um get the uh contract as opposed to uh MSC?

Why didn't you just get the entire thing and avoid MSC altogether?

Through the chair, we just um also contracting procurement one to make sure that we had enough coverage because currently we do have three MRO contracts, and we wanted to make sure that we still have the same coverage to support the departments.

So that's why you see multiple awards, because the current MRO contracts, we there are multiple awards as well, and we wanted to continue with that um with that um protocol.

So do I hear you say that Granger just did not have the capacity to fulfill all of these supplies?

Is that is that what you're saying?

No, I didn't say no, to the chair, no.

Um we wanted to so when the MRO contracts come through or um orders come through, a lot of times that what the departments are able to do with multiple awards as they're doing currently, is they're able to shop through the punch out system to determine it's like for a particular item which vendor has the most, which vendor has the best price, as well as the delivery turnaround time.

So we give them the option to look at each one of those contracts and make a selection based on the price and based on their lead time or their delivery time.

Okay, so price based on the particular supply that's in the yes, ma'am.

All right, it's a bit complicated, but I'm just saying, as I I mean, I just wonder why Granger couldn't do the whole thing, but you you kind of explained it, you know, I suppose.

Um, because you know, we we want to push as more as many um uh Detroit contractors as we can um to participate in the in this process because it doesn't it doesn't help necessarily help our economy if all the contracts are going elsewhere so um and we certainly hope that you will keep that in mind uh for the future.

I want to see a shift in things that we're doing a lot more uh business with folks that are right here in this city.

I'd like to see that shift.

Okay, through the chair.

Also, um MS vendors have indicated that they're willing to hire Detroiters and um MSC, they do have a agreement with a Detroit-based company, uh ACE Restoration to help them in their efforts to do for this contract, they would be acting like a salesperson.

So MSC has collaborated with a Detroit um certified company to assist them with this contract in terms of um the sales part portion of it.

Yeah, uh let me just say that you know a lot of those vendors say that, but when it's when it's all said and done, we still have a number of Detroiters that are without jobs.

They can't seem to get the jobs.

They say that, but it never happens, and so that is my frustration.

Uh when these vendors didn't just tell us what they what uh they believe you want to hear, then they turn around and say, Oh, well, you ask them a little bit later.

Well, we couldn't find any Detroiters that were qualified, not even anybody, I guess that they could train.

I I just don't know.

I'm I'm just kind of tired of hearing uh that same old story, and and I believe that we've got to do something different.

Understood through the chair, understood.

Thank you, Mr.

Chairman.

Thank you, Member Waters Vice Chair Johnson.

Thank you, Mr.

Chair.

Um, and thank you, Member Waters, for the line of questioning.

Um, I do want to share that District 4 is hosting a job fair on June 27th, and we will reach out to you to share that information with these vendors so they can join us, and they would be able to hire Detroit residents at that event.

Now I will say that the last couple of job fairs we've had, we've had residents come from the entire city of Detroit to the job fair, not just District 4.

Um, I was actually quite surprised by that, but we'll make sure we get that information to you.

My question to you is um does the city have a contract with these three vendors currently or the widgets and things that they make through the chair.

There's a current contract with Granger, and there's a current contract with MSc.

The contract that's before your honorable body today is for uh news for the new contracts for new contracts.

These will be aspiring shortly, so these will be for the new contracts.

Yes, and currently there's a contract with Granger and MSc.

Okay, so the city does not currently have a contract with Fastanel.

That is correct.

Okay.

Um I wonder if you might be able to share with us, and I don't anticipate you'll be able to do this now.

Um, but if you can share with us what percentage of the current contracts, I guess each entity has received.

So what percentage of business are we doing with Granger as opposed to MSC?

I'm not sure if there are any other contracts that we have with any other entity that provides these items, but if you can share that, it would it would really be good to know.

Through the chair, we will work on that and uh send it to your honorable body.

Thank you.

And do you think you would be able to get it to us by Tuesday?

We should be able to.

I would do my best to get that information to you as soon as possible.

Okay, thank you.

Um, do you know?

I'm not sure if you all have priced out the different supplies that the city might purchase from any of these entities.

Would you know if there is a cost difference by supply type?

Through the chair, um, we had a when we did the analysis, the initial analysis, we had some samples, sample items that um each vendor provided a quote for if they had in their inventory, so we should be able to give you a sample set with the prices for those three individual companies.

Is that what you're asking for?

Yes.

So we will work on that as well.

Okay, thank you.

Um, and I know Granger is a sizable company, so I'm wondering if there have been instances in the past when a department was seeking supplies and they were not able to provide them.

You may not know that.

That is correct.

Um, but I would see what information we can provide to you to this honorable body.

Okay, thank you.

Thank you, Mr.

Chair.

Thank you.

Excuse me, through the chair.

I just want to repeat to make sure I have all the questions that you're looking for.

Um, one, you want the percentage of the current businesses that's doing work, and then the sample of the prices, um, the price difference for some sample items in any instances where uh where Granger was not able to provide the inventory?

Yes.

Or the request.

Okay.

Yes, that would be great because I am wondering why um we need the other two, only because I know the size of Granger.

Okay, thank you.

You're welcome.

Thank you, Mr.

Chair.

Thank you, Vice Chair Johnson member waters.

All right, so uh could you talk about the historical spending that supports the uh contract amounts?

So if our past spending was lower, what cost increases or usage for crack forecasts justify um raising the contracts?

Um the cur.

Oh was she trying to say my apologies?

I interrupted you.

Oh no, no, you were about to respond.

Yes, but um, but I did it in um before you finish your question, before you finish your thought.

Oh, okay.

Well, I I have another question.

So you want to respond to that one, or just you want them both at the same time.

Well, let me respond to this one.

So there was an analysis done, and um currently the spend for we see for a year was about approximately a million dollars.

So that that's why the contracts you see for six, because it's for a five-year period, and within that amount, there's a contingency baked in case of um to make sure we have coverage, but remember these are as needed, so that doesn't mean just because the contract is for six million dollars, we have to see what actually spends six million.

Yeah, I would imagine maybe tariffs have something to do with the increase as well.

Um yes, ma'am.

Yeah, there were several uh vendors that were disqualified.

Um would you mind just citing some of the reasons they were disqualified?

Yes, some of them were not able to provide the um the inventory that we requested with the bid.

There were the ones that were disqualified were disqualified for those reasons.

The three who were who moved forward were able to provide the majority of the items um that we asked in terms of the master list as well as the alternate list.

So could you all consider um, especially if they're here in the city, um helping them to get to capacity in the future, you know, maybe you can do something on a smaller scale with them so that they can build up or something like that.

I don't know.

Um we've just got to do something a little bit different.

So if if you guys could think about doing something like that uh to help more of our vendors here in the city to reach, you know, to get to a capacity so that they can they can certainly win some of these bids.

I will refer this to our senior management OCP.

Your concerns.

All right.

Well, thank you.

No, she knows I've said it before, so tell her I said it again.

Okay, thank you.

Thank you, Mr.

Waters.

Uh I I have a question.

Um Ms.

Clark, is what is how quickly are um is the administration needing approval on these contracts.

Well, the contracts.

Well, I wanted we want to make OCP wants to make sure that all your questions are answered.

We do have some time.

Um, you know, we could we want to make sure that we answer any concerns that your this honorable body has.

I appreciate that.

I because uh an additional question I uh have to add to your list is that um seeing that uh Granger and M MSC, especially MSC, um have contracts with the city already.

Um and I know you mentioned that they made a commitment to hire Detroiters, but I would hope that they had made that commitment before and that they had increased the number of Detroiters that they have hired.

And and the same I mean if you could provide that for all three that would be great.

And I'm I'm wondering I I will I ask about the time because I actually like if there is if that is the will of my colleagues to actually bring these back um in a week I would because I want to be transparent I'm not inclined at the current moment to support 6.2 or 6.3 um because I we have had this conversation in in this committee and other committees I understand when contracts come down and um the specialized services and there may be a vendor supplier that that's only the one in state um and and I'm not negating the importance of these materials but they they seem to be as member waters um indicated that there might be ways that we could have broken this up to get more Detroit based vendors and and I'm just concerned about that because these are quite sizable contracts so I just want to make sure we have all that we're looking at all the the information as much information as possible there so instead of moving these out um I would like if that is the will of my colleagues if there is a motion to bring uh these items back in one week motion there's been a motion to bring back six point one through six point three in one week is there are there any objections seeing none I actually shall be taken appreciate you Ms.

Clark I know we had a lot of questions for you um but I thank you for walking us through all of it thank you thank you have a great afternoon you too all right that will take us on from the uh to six point four from the chief financial officer in the office of budget uh 6.4 is a resolution authorizing American Rescue Plan Act Fiscal Recovery Funds budget transfer um is there a motion to discuss motion it's been a motion to discuss six point four mr washerton I believe we have miss Daniels deputy cfold and director Johnson through the chair yes that is correct I believe they're being promoted now thank you and through the chair Terry is under the name Daniels TE Thank you.

Good afternoon Mr.

Chair um Donnie Johnson Deputy uh chief financial officer and budget director good afternoon Mr.

Chair Terry Daniels Deputy CFO Office of Development and Grants good afternoon to you both anyone else okay uh Mr.

Chair I can't hear you oh sorry about that just said good afternoon and just checking to see if there's anyone else joining you all I think we're good to proceed.

I don't believe so okay all right um if you all before you get to any questions if you all can just uh describe the budget transfers that are being requested here so what you have before you is a request to uh transfer ARPA funding into um uh new appropriate well existing appropriations um in our last discussion about ARPA we we told this honorable body that we would be bringing um reassigned funds back to you to decide how the funds would be reprogrammed so we have been able to identify uh 3.7 million dollars in uh reassigned funds at this point um and 2.7 of that uh will go to council uh we're recommending to go to council which comes out to about 300 000 per council member um for you to decide um how that will be reprogrammed into existing ARPA projects okay thank you um anything else there are we good uh any questions begin with vice chair johnson uh thank you mr chair just want to clarify the total amount did you say 3.7 or 2.7 uh through the chair there's 3.7 that we've been able to identify we are recommending that one million goes to Wayne Metro for Detroit housing services and 2.7 million uh be used to uh be reprogrammed

Are we good?

Uh any questions begin with Vice Chair Johnson.

Uh thank you, Mr.

Chair.

I just want to clarify the total amount.

Did you say 3.7 or 2.7?

Uh through the chair, there's 3.7 that we've been able to identify.

We are recommending that 1 million goes to Wayne Metro for Detroit Housing Services and 2.7 million uh be used to uh be reprogrammed by each council member.

Okay, thank you.

I missed the one million.

And that's that's just a suggestion, right?

It is a recommendation.

It's a recommendation.

Okay, thank you.

Thank you, Mr.

Chair.

Thank you.

Member Waters, any questions?

No.

All right.

I do have a few.

Um, and this may be for LPD, but uh if this were to go through what the 2.7 or whatever amount for city council, uh, what is that process of allocation from there?

Mr.

Chair, so um council members would need to uh come together and decide how you want to allocate the 2.7 million.

Uh as Ms.

Daniels indicated, if you divide that by nine, you so you get an even amount of 300,000 per council person.

Um last year, council uh received about 9.5 million, and it was divided by nine, so it's about a million dollars, you know, um to each councilperson, and um the office of development and uh and and um and grants, Ms.

Daniels and her team provided city council those projects that could absorb the additional allocations.

And so for in this case, um in the in the memo to city council for recommending the 2.7, there's about six or seven projects that they're suggesting that the uh allocation of 300,000 if you want to do it that way, could go to.

In fact, that's on page two of the council letter.

Um and so council will need to come together and decide how you want to do it.

And um Ms.

Daniels is indicating that they would like council to come up with your plan, you know, you know, as soon as possible, because we're running out of time to spend these opera dollars by December 31st.

So maybe Mr.

Chair, you could reach out to um President Tate and get his take on it and see if he wants to um maybe at formal on Tuesday, you know, have a dis discussion with you all about this, or maybe he can work with your c you know with the colleagues and come up with a way of how you want to divide the 2.7 million dollars.

But administration is just asking that you do it as soon as possible.

Absolutely.

All right, thank you, Mr.

Corley.

And another question, this may be for Vice Chair Johnson, um, or not to put you on spot, but as we're thinking about the recommended recommended amounts, um, knowing that budget amendments have to come from the administration once they come what is the process like if there was think about the recommended amounts, is it up to us to say this is the amount or at the table we change it?

Is that in this committee or where does that take place?

Yeah, Mr.

Chair, so um uh yeah, it it would it would take the council members to kind of come together and decide how you want to divide the 2.7 million dollars.

You might sorry, Ms.

Croy.

Don't mean to interrupt you.

I mean um saying that this is 3.7 total, 3.7 million total.

So one bucket is for Wayne Metro, yeah, one is for the city council appropriation.

Is that do is there flexibility there, or do we have to take those numbers uh with the recommendation well for the one million, um you know, you pretty you probably want to highly consider their recommendation, you know.

Uh Wayne Metro and maybe want to hear from Ms.

Daniels.

Um this is for the Detroit Housing Services Project, and so you might want to hear from her as to why it's important to you know allocate another million dollars to them.

Um but for the 2.7, yeah, that's that would be an internal process.

If if council approves this resolution on Tuesday, the 2.7 million will go into an appropriation in non-departmental, and it'd be like a placeholder, and they would be waiting for council's uh decide decision how you want to divide up to 2.7.

And so that would that would require another a separate resolution.

And last year, LPD uh prepared the resolution on behalf of city council as you decided to divide the nine million last year.

So we could do the same thing, you know.

Once you figure out how you want to allocate the 2.7 million, we could provide the resolution.

We could share it with Ms.

Daniels and Mr.

Johnson, make sure you know everything looks fine, and then um go from there.

Thank you.

Uh Ms.

Daniels, if you could just go into the um the need for the one million for Wayne Metro.

Thank you, Mr.

Chair.

Uh so Wayne Metro operates the Detroit Housing Services on behalf of the city.

Um that program is slated to end in uh September 30th of this year, and they are in need of um additional funding um to continue the call center um and to assist in additional um direct services.

Thank you.

And and they would be able to spend that one million by the end of the year, or was that September 30?

Absolutely.

Okay.

All right.

Any further questions?

Vice Chair Johnson.

Thank you, Mr.

Chair.

I know um yesterday, yes, on Tuesday, we allocated some funds to Wayne Metro.

I'm not I'm trying to see if my team can share with me what the specific um dollars were for.

Um, not sure if you all know what they may have been for, but it was roughly I believe six million dollars.

Uh through the chair, uh that may have been the it wasn't ARPA funding.

I know that it was an ARPA funding.

Um I can't recall what that project exactly what that project was the chair, Mr.

Washta.

Yes, um, we've also been joined by Chelsea Nevliet that she can be promoted as well.

Okay.

Um, good afternoon to this honorable body.

Chelsea Demblett, interim director for human homeless and family services department.

Um, I was able um to hear council member Johnson's question through the chair.

The funds that were allocated to Wayne Metro on Tuesday at formal session was for tenant-based rental assistance.

So that's specifically for residents that are residing in emergency shelter um that need rental assistance payments to help with outflow and to access permanent housing.

Um, so the funds that um director Daniels was referencing for Detroit housing services as more prevention, so upstream.

So responding to residents that are facing displacement um and to stabilize households where the the funds from Tuesday are to serve residents that are in emergency shelter um to assist with outflow to permanent housing.

I'm sorry, Ms.

Neblet, and you indicated that the one million dollars is being used for that, or that the there was a contract um that where we increased funds for the hotline yesterday through the chair, um to council member Johnson.

So the funds from Tuesday were the are the tenant-based rental assistance funds.

So that is specifically to make rental assistance payments for residents that are enrolled in emergency shelter.

Um the one million dollars that Director Daniels referenced is for the Detroit Housing Resource Um, both the helpline and direct service dollars uh for residents that are facing housing displacement and housing insecurity to prevent homelessness and shelter enrollment.

Okay, thank you for that.

There was also a contract yesterday to increase funds to include is what it says, right to council in CAM hotline and exercise one year renewal.

I do understand that it's city funding, it's not ARPA, but it was 1,375,757.

Can you connect the one million dollars to this contract that was just approved yesterday?

Are they the same services?

Through the chair to council member Johnson, thank you for the question.

So the amendment related to the ancillary services for the helpline for right to counsel, that is specific to residents that are facing eviction to be able to provide legal advice and connection to right to counsel um prior to uh a tenant being in court as well as CAM only.

Um so uh the CAM access line for residents that are experiencing unsheltered homelessness that need to access emergency shelter.

So we have emergency shelter side resources for emergency shelter, and then we have the upstream prevention.

It's kind of how I I look at it.

Okay, thank you.

And I wonder do you all know if any funding has been provided to Wayne Metro for the Detroit Housing Services portion of the work they do?

Uh through the chair to member Johnson, yes.

So um we would we would be doing a contract amendment um for the the current ARPA contract um that includes funding for the direct service portion.

So when residents call the Detroit Housing Resource Help line, um they may be you know in active eviction proceedings, maybe they experience unfortunately a building fire, um, there's code conditions, and we provide relocation and wraparound services.

So this is a continuation of the contract that we've had um to provide residents um those direct service payments.

And so that would include right um first month rent and security deposit, diversion payments, um, and those type of services to help stabilize households and residents um so emergency shelter is not needed.

Okay, and are you able to share what how much um was provided to Wayne Metro for Detroit Housing Services and how much funding they have available within that within the current contract?

Um through the chair to member Johnson, I can absolutely follow up with those specific numbers.

Thank you.

Thank you, Mr.

Chair.

Thank you.

Any further, Mr.

Kohler, you have you have any other questions or any questions?

So no other questions, Mr.

Chair.

Just again, just to you know, reiterate uh my suggestion that you probably want to reach out to President Tate.

Uh so maybe on by Tuesday, council as a whole can have a discussion in terms of how you want to divide up the 2.7 million, and once you come to an agreement with that, we in the LPD will prepare you know the resolution to do that and um and help you with that process.

But again, that the administration is just asking that you try to council that you know try to do it as soon as possible.

So then make sure make the money is spent um before December 31st or by December 31st.

All right, thank you.

All right, is there a motion on 6.4?

Uh oh yeah discussion, Johnson.

Thank you, Mr.

Chair.

Um, so just for clarification, if we were to move this to formal, is this already assuming that the one million is going to be agreed upon to provide two-way metro?

I believe that's the way I'm reading the reso that's attached.

I just want to be sure because I I wouldn't necessarily want to move it like this without the full body weighing in on whether or not their support for the one million dollars to go to uh Wayne Metro.

I suppose we could always amend it.

Oh no, we can't amend it.

We would need a new resolution.

All right, Mr.

Chair, how'd you like to move forward?

Oh, you bring up a good point, Vice Chair.

Mr.

Chair, Mr.

Core.

If I can add one little tid tid as well.

So if council were to approve this resolution, uh Ms.

Daniels is indicating that the Wayne Metro contract would come to the planning and economic development committee.

So I don't know how soon it will come if council approves this on Tuesday, but I'm assuming it would come fairly soon.

Um is that the case, um Ms.

Daniels?

Uh through the chair, that is the case.

Uh, if this resolution is approved, then that uh Wayne Metro contract amendment amendment would um was soon following thank you.

Discussion?

Vice Chair.

Thank you.

Um does that mean it's on PED's agenda for tomorrow or after this resolution is approved.

Uh for the chair, uh that contract would not go to um the committee until the funds are approved to increase it.

Okay, thank you.

Thank you.

Uh I'm I guess I'm yeah, I'm still uh still stuck on the way metro piece and also the need Mr.

Chair, Vice Chair Johnson.

Um with timing being of the essence, I think you might be able to move it out.

Um perhaps without recommendation and just move it to formal for Tuesday.

Um ask colleagues between now and Tuesday how they'd like to proceed, and if it's different from what's currently before us, then we can would we have to we'd have to vote it down, or if the administration would be willing to amend it based upon the desire of the body, then they could amend the the resolution and provide an updated resolution.

Thank you, Vice Chair.

And just so um, so that process for on this resolution, we would not be able to amend the uh a mouse from the table, right?

It would have to be the administration.

Is it for LPD?

That's Mr.

Sheen.

Yes, that's correct.

Okay.

Okay.

Well, I'm fine with that process.

And uh if we need to get back, we bring it back.

But okay, is there a motion on 6.4 to send to formal with no recommendation?

Motion.

There's been a motion to send 6.4 to formal with no recommendation.

Are there any objections?

All right, seeing none actually shall be taken, and I will reach out to colleagues to see.

Thank you.

Thank you all.

Thank you.

All right, moving along.

This will bring us to 6.5 from the office of city clerk and city planning commission.

This is uh neighborhood enterprise zone certificate applications for the construction of seven new single family houses at 157 and 1583 Belvedere and one five five one five one five, one five one six, one five two two, one seven four eight and one eight zero three Holcomb Avenue in the East Village Amended Neighborhood Enterprise Zone Area.

Is there a motion to discuss motion?

It's been a motion to discuss.

Mr.

Gulach, good afternoon.

Good afternoon, Mr.

Chair Chris Gulach, LPD staff.

We're joined by the developer and the rep, Mr.

Matt Temkin and Elizabeth Mastering.

Good afternoon.

If you can introduce yourself for the record.

Sure, I'm Matt Temkin.

I'm uh developer of the homes.

And I'm Elizabeth Mastering, I'm with SME, and I am the consultant to the developer.

All right.

Uh floor is yours, Mr.

Dulot.

Thank you, Mr.

Chair.

Uh staff has a brief uh PowerPoint overview.

Uh staff also submitted a short memo and a uh resolution for your consideration.

This is a NEZ certificate review for seven new houses on Holcomb and Belvedere streets in in the East Village NEC.

There you go.

This shows a map of the location.

It's just east of Indian Village, north of between Kirchhoff and Jefferson.

Zooming in closer here's Holcombe Street.

You can see there are there are houses on the street, but a lot of vacant land as well.

And on Belvedere Street as well.

Uh the developer has been working to acquire vacant parcels over the past several years to build new infill single family housing.

This is in the East Village NAZ, which is shown on the map as a turquoise uh box.

Over 100 acres was established by City Council in 2005.

Petitioner is an LLC, but it's really the developer's Great Water Homes, which I believe the council members are familiar with.

Um the petitioner indicates similar to this previous request for this area.

There's four potential house designs for buyers to choose from.

And the house the range the houses range from a thousand square feet to 18 1,850 square feet.

And buyers can pick up two to four bedrooms, one or two stories.

The cost to build is 275,000 to 425,000.

The estimated sale prices between 550 and 650,000.

Chris, really quickly, that's that's wrong.

Estimated sales price is 350 to 550.

Oh, sale price?

Yep.

Okay, sorry.

I'm correcting.

Yep.

Thank you.

And moving on.

Regarding parking, uh the petitioner um indicates they have detached garages which are accessed off the rear alley.

Um I believe if a if a buyer wants to save money, they can decline the uh the new garage, of course.

Regarding an accessibility developer will customize the 88 access um if requested by the buyer.

And so staff has concluded this isn't an NEZ zone.

Uh they did apply for the certificates back in February.

And the NEZ Act requires you apply for the certificates before the building department building permit is issued and they've met that requirement.

These are some images from the group's website.

Uh that you can see some of the different options folks can choose.

They've already constructed several units.

Um other options as well.

That concludes my over in conclusion, uh, staff is recommending approval of the NEZ request.

Thank you, Mr.

Chair.

Thank you.

Um Mr.

Tempkin, uh, Miss Massarin, anything uh uh come see them.

Uh whenever you want.

We're happy to show them off.

And then um we're also working on a project that I think you guys will like.

If we can get the extra four and a half feet of width, we're trying to figure out if we can build one of these homes that would be beautiful uh and actually sell it for 250.

If we could do that, you get somebody's mortgage under 1500 a month.

You're talking about giving somebody ownership for the price of a rental, uh, which would be pretty amazing.

Um you can buy an old home for that amount of money, but you can't buy a new home.

And there's a big difference between those two things as far as like the cost experience for the buyer goes.

So anyway, sorry, I encourage anybody to come see them, whatever.

And uh we're working on a prototype of the uh the smaller house as well.

Thank you.

Okay.

Any questions from uh committee uh member waters?

So good afternoon.

Um you mentioned that the ADA access would um be uh provided if uh if it's requested by the buyer.

Uh would those be additional costs to the buyer?

Um it's a good question.

I mean, I think our goal would have it not be.

I'm sorry if I missed a formal way to respond to say that, but I I would say that no, our our goal would not have it to be not an extra cost.

I don't exactly know with respect to like porches and concrete are unfortunately expensive.

The inside of the house for the Alden actually is already set up for it.

But our goal would be not cost more.

That would be the goal, but not for sure.

I get it.

I don't know because we haven't uh honestly we haven't like figured out the price of it because we haven't actually been confronted with it yet.

Yeah.

Um I'm I'm happy to try to figure it out in anticipation.

Yeah, that would be nice.

And you know, whether or not the so that the buyer will know up front just in case um they need that.

Um are there any limits on upgrades or customizations to ensure sale prices um don't um too far exceed the 500 the state at 550k?

Uh the 550k is if you actually pick legitimately everything.

Like that's if you do solid oak floors, wood burning fireplace, garage.

So uh no, I don't have a limit on it.

I mean, I I think truthfully the margin that we're making on the smaller home is actually not like a sustainable thing.

By selling the bigger ones, you actually kind of subsidize the smaller ones.

Um like we couldn't do a full development of just the smaller ones, we don't think, uh, or we know we couldn't, like you just you actually can't make the numbers work, but it's odd because the bigger house is actually it's a better deal for the buyer in terms of per square foot price, and then it's also works better for uh the contractor us.

So what we're doing is we're basically using the bigger houses to enable us to also build the smaller houses, which enables people on the lower end of the cost spectrum to be able to get into ownership.

Um I know that you've done quite a few homes, you know, in in the area on the east side.

So um I'm certain we appreciate that because that neighborhood, that community certainly could use exactly that.

And and I've seen some of them.

Um what about um people who have say um HUD?

Are they are they able to use um any HUD resources to to purchase a home?

Okay.

It's a good question.

I I don't actually know.

I mean, we can't do them for rentals.

Uh because you actually you can't get the tax abatement in the context of a rental.

And so I mean the HUD stuff that we have encountered anyhow is uh you know, for rental assistance.

Well, okay, and I think we should we should find out uh, you know, all these horrible announcements coming down from HUD.

It um maybe they want people to go into homeownership.

I just don't know what's I think they do.

I think you're right.

I think the regional administrator came out because he wanted to see the houses.

He came in from Wisconsin, and then the guy that's local here, Jeff Hickox came out to see him too.

They said that there's some announcements coming out in June about it, but honestly, that seems so much to me, like that they definitely want people to get into ownership because they were super excited about it about what we were doing.

So, yeah, if there's something to do, I pushed uh the local guy, Jeff, and then also I I invited the regional administrator to come to the housing conference that we're doing on June 25.

You know, happy to talk about that stuff there.

I mean, if there are ways to get more people into ownership, I mean, you've got my commitment that we will make do whatever we can to help make that happen.

We're currently offering existing residents in our properties, rental properties 10,000 uh if they end up wanting to buy a house from us.

Um so we're doing whatever we can to create a path to ownership for people for sure.

Okay then.

Thank you.

Thank you, Mr.

Chairman.

Thank you, member Waters for sure, Johnson.

Thank you, Mr.

Chair, and good afternoon.

Um so the I guess HUD through the Detroit Housing Commission does allow for a Section 8 voucher to be used towards a mortgage.

Um there's some additional questions that the Detroit Housing Commission really need to answer to evaluate.

Um because this would be wonderful, especially if um or when you're able to get the um the purchase price or sale price at that 250,000 mark.

I certainly think that would be extremely beneficial for um some families that do have vouchers for them to be able to utilize it towards a mortgage and help them to become homeowners.

So I think that would be a great topic of conversation at your conference.

Um I also just wanted to ask you do you have any ranch style houses within your designs?

We do.

Yeah, the the small one, the two-bedroom, two bath, or you can get it as a two-bedroom, one bath as well.

And so that's like perfect for seniors and everything.

Um and by the way, on the 250,000 dollar house, like assuming things go right in the next couple weeks here, we're trying to get started on building a prototype.

Our goal is to have it be ready by Christmas.

And then my goal is to just get everybody into that house.

And if we all think it's cool, bring HUD in, you bring section, you know, whatever it is, you bring all it in, and we try to figure out all right, what do we do?

How do we get this thing built so you can put people into ownership exactly the way that you're saying?

So I just want to let you know that we're building the prototype, assuming things go well in the next few weeks here with acquiring the parcel, because unfortunately we had to get a much bigger parcel of land to build a smaller house on because of the current zoning rules.

But um anyway.

Got it.

Got it.

And and I believe that ordinance amendment is coming to us.

I don't know that it's coming to us uh in time for your your prototype.

Um but it is.

It won't for that, but yeah, we got we couldn't wait.

We wanted to get it done this year.

It's like it's so important to get the prototype done so people can see it.

Awesome.

Well, it's on its way.

Uh sweet.

Thank you.

The the other thing I I just wanted to ask maybe Mr.

Gulag or to either one of you.

Um, so Greatwater homes had a request for an NEZ that came to us maybe a few weeks ago.

Is there any reason why these parcels didn't come at the same time?

They're they're all in the same NEZ district, I believe.

Yeah, through the chair we receive the the developer has to submit the applications to the clerk's office and then they forward them to the assessors and then they refer them to our office for review.

And we just been getting them incrementally, you know, maybe five, four to seven at a time.

But I'll I'll defer to Mr.

Temkin if he knows about uh how he has to spread them out if he has to spread them out.

No, I mean on our from our perspective, it's better to batch them, I think.

I I don't think we gain anything by uh by spreading them.

As far as I know, I mean I don't know.

We are our goal is to simplify the process, not complicated, that's for sure.

And through the chair, if I can add, I assume they just they submit them as they're ready, but we we can circle back to Mr.

Temkin, you know, to figure out how many are coming in the future and then how to streamline, but yeah, I I just assume the developers submitted them as they were uh as they assemble the land and are ready to move forward, but we can talk to them.

Okay, that'd be great.

All right, thank you.

Thank you, Mr.

Chair.

Thank you, Vice Chair Johnson.

I'm just looking over notes here just before I um Mr.

Tempkins.

I know we had this conversation before.

I'm just trying to find my notes, but on the on the workforce that is involved in building these homes and also a placement.

Can you just walk us through how that looks in terms of uh Detroiters and also um if it is union labor?

Uh yeah, I mean I'm I'm having to be an open book about that.

I don't actually know tons about like the workforce.

I would say getting the contractors to get started doing this was tricky initially.

Um just because it you know when we started doing it, it was like a the thing that really didn't exist.

It's gotten easier as we've gone along here.

Um I would bet some portion of the the workforce is you know, people who are living in Detroit.

I don't know it for a fact.

We're not really like big enough where we're kind of throwing our weight around with respect to the contractors.

We're still trying to get people who want to do the work.

Um, because there's still there's theft and uh different insurance requirements, the building requirements are trickier and everything else.

So um as far as union goes, I think it's generally non-union, though.

I honestly I don't know.

Uh um I want to say I mean I've talked to a local representative from the IBEW, he knows what we're doing, likes what we're doing.

That's the electrical workers.

So we don't have an aversion to using union labor.

We certainly don't have an aversion to using people who are living in the city of Detroit.

Truthfully, so far we've been finding the contractors where we can find them, and um, you know, just trying to get this thing going.

All right.

Um what we'll do appreciate the um transparency.

I don't know if we were able if we got you the invite to the uh skill trace task force last time, but we'll follow up to make sure we get you to the info at the next meeting.

Um because please do that'd be great.

Yeah, I mean if if if there are jobs that we can provide to people, I mean it was interesting.

I was I've been on, you know, as you were talking to the pilot on the other things and everything else.

And I will say that like I know on the multi-family side of things, it's like all of our leasing agents, most of our maintenance people, other people like live in our properties and everything.

So we're definitely our goal, you know, our goal is for the people who are working on the homes or living in the building, working on the buildings to be able to like kind of eat what they cook, you know.

Absolutely.

Okay, thank you.

Um, no further questions for me.

Any is there a motion on 6.5?

There's been a motion to approve and sent to formal 6.5.

Any objections?

Seeing none that action shall be taken.

Thank you all for joining us.

Thanks so much.

Thank you.

All right, that'll move us on to 6.6.

Um, this is uh report relative to the review of the cost benefit analysis associated with the proposed city club apartment CBD standard workforce housing project payment in lieu of taxes.

I know we did go over this uh a little bit during that discussion about defer to you, member Johnson on motion here.

Motion to receive and file.

There's been a motion to receive and file 6.6.

Any objections?

Seeing none, that action shall be taken.

All right.

Is there a motion to suspend member reports?

Motion to suspend member reports, seeing no objections.

The action shall be taken.

See no further business before this committee.

Is there a motion to adjourn?

Motion.

Thank you all.