Develop PGH Bulletins: Penguins' Development Partners Release Offer Sheet After Overtime Meeting

Pittsburgh PA

17 March, 2021

6:34 PM

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By Rich Lord, Public Source 2021-03-16 Develop PGH Bulletins updates you on the Pittsburgh region's economy, including close coverage of the Urban Redevelopment Authority, City Planning Commission and other important agencies. Please check back frequently, sign up for the Develop PGH newsletter and email [email protected] with questions, tips or story ideas. Following a lengthy community meeting Monday night, the Penguins' development team released a list of the investments they're willing to make in the Hill District, if their plan for a 26-story bank tower gets community support, wins city approval and doesn't face court challenges. Following a Monday night, the Penguins' development team released a list of the investments they're willing to make in the Hill District, if their plan for a 26-story bank tower gets community support, wins city approval and doesn't face court challenges. The Penguins-affiliated Pittsburgh Arena Real Estate Development [PAR] and its chosen developer Buccini/Pollin Group [BPG] plan to go before the City Planning Commission to seek approval to build First National Bank's new headquarters tower, plus around 3.5 acres of terraced open space. The FNB tower and the greenspace would occupy the part of the 28 acre site of the former Civic Arena that is closest to Downtown, adjacent to the Cap Park which is currently under construction. The Monday night Development Activities Meeting, conducted by the Hill Community Development Corp., was a required step before seeking City Planning Commission consideration. The Hill CDC has said that PAR hasn't done enough to satisfy pledges made in a 2014 agreement called the Community Collaboration Implementation Plan. That plan sets out seven areas of investment, ranging from cultural preservation to minority- and women-owned business enterprise [M/WBE] inclusion. At the meeting, BPG attempted to answer that concern by referring to a new 27-page term sheet that it had proffered to the Hill CDC on March 12. After the meeting, Penguins' Senior Vice President and General Counsel Kevin Acklin released the term sheet. It lists around $34 million in proposed, ongoing or completed investments in the Hill associated with the FNB tower, plus a shorter list totaling $13.5 million financed via another part of the site, on which a Live Nation concert venue is slated to be built. Here's what the term sheet promises in relation to the FNB site: Planned investments: Ongoing investments: Completed investments: The term sheet also touts a central selling point of the project: its aim to extend Wylie Avenue through the site, creating "an important visual, pedestrian, cultural and commercial connector" between the Hill and Downtown. The investments related to the concert venue site include $4.2 million for the Greater Hill Reinvestment Fund, another $2.5 million worth of greenspace, $1.6 million for a minority business incubator, $1.2 million for a medic station, $1 million for public art and $100,000 for the Ammon Recreation Center. Hill CDC leaders did not have immediate comment on the term sheet. The Penguins' development team asked for the Hill District's support for a proposed new First National Bank tower and nearby open space on the former Civic Arena site. But the plan ran into skepticism from Hill leaders and residents in a meeting ahead of a key approval vote. A team led by the Penguins-affiliated Pittsburgh Arena Real Estate Development [PAR] and their chosen developer Buccini/Pollin Group [BPG] painted a picture of shimmering glass and inviting greenspace near the Hill's border with Downtown, which they said would knit the neighborhoods back together for the good of all. "We're incredibly proud of the project itself and the impact it will have on the surrounding community and the City of Pittsburgh, and its chance to repair broken connections," said Chris Buccini, co-president of BPG. The team emphasized a design which would extend a freshly landscaped Wylie Avenue through the 28 acres once occupied by the arena, pledging to use it to transform the entire Hill. "No project in the Lower Hill will be successful unless the entire Hill is successful," said Amachie Ackah, founder of Clay Cove Capital, one of the investors in the development. "We want to engage the entire community, and with that we're only going to have a deeper and richer project." A virtual audience that approached 200 on Zoom, and likely others watching on Facebook and YouTube, pressed hard for specifics on both the process and the payoff for the community. They did not get many specifics, though some lie within a 27-page proposed term sheet the development team provided to the Hill Community Development Corporation on Friday. The proposed terms were not detailed in the meeting. Hill CDC President and CEO Marimba Milliones said Hill organizations need time to review the term sheet. "We want to see development, too, but it's got to be right," she said. "It is time for us to go to work. But if we don't have the proper accountability in place, we will think we are going to work, but we will not be going to work." Buccini and his team closed the meeting by teasing a few items from the term sheet, including $400,000 in grants for small businesses, $6 million to $7 million in investments in open space, diversion of half of new tax revenue to Hill redevelopment, and minority- and women-owned business contracts of $5 million and counting. The Penguins asked for the evening Development Activities Meeting [DAM], which is a required precursor to any effort to get City Planning Commission approval. Felicity Williams, the Hill CDC's programs and policy manager, said PAR plans to seek commission approval for their plan for FNB's proposed 26-story tower and nearby terraced open space. As the area's registered community organization, the Hill CDC was required to conduct the DAM upon PAR's request. But Milliones noted that the team's plans have been given grades of E and F in the Hill's longstanding Development Review Panel process, which scores them against their compliance with the neighborhood's master plan and a seven-year-old community benefits agreement. Buccini said that the timing is driven in part by the desire to take ownership of the land, from the current public sector owners, and start building in time for FNB to move in before its existing leases expire. Kaiya Price-Dennis, a resident participant in the meeting, called for "real dollars that will change lives, that will improve communities," demanding "a contract that can be backed in a court of law. ... Put pen to paper. Sign a contract. Put dollars behind the contract." Buccini said there's "only so much that we can do, financially, to make this work," adding that the term sheet lays all of that out. "We're ready to countersign that tonight." The Hill has been a subject of intense debate for well over half a century, and the latest chapter has gone on for seven years. In 2014, PAR, the Hill CDC, Mayor Bill Peduto and Allegheny County Executive Rich Fitzgerald signed the Community Collaboration and Implementation Plan [CCIP], detailing the process of sharing the benefits across seven categories: In May 2020, the Urban Redevelopment Authority board balked at providing initial approval for the FNB tower, citing community concerns with the pace of progress on the community benefits. The Penguins then announced that they would cease development operations. Within a week, the URA and the team reached agreement to tentatively move ahead on the bank tower. Neighborhood leaders were again upset last month when they learned of a decision by the U.S. Census Bureau to adjust census tract lines. The change includes the development site in a Hill District census tract, rather than Downtown's tract. The move allows the site to receive tax-deferred Opportunity Zone investments, but Hill CDC leaders are concerned that it could jeopardize neighborhood access to other funding. That boundary change prompted the Hill's development panel to "raise the bar" and, as a result, lower the team's grades in the DRP process from C and D to E and F. The meeting, originally set to run from 6 p.m. to 8 p.m., was ongoing at 9 p.m. A home ownership and rehab plan touted on Wednesday by Pittsburgh Mayor Bill Peduto faced tough questions from the mayor-appointed Urban Redevelopment Authority board Thursday, but cleared a first procedural hurdle. In the just-announced OwnPGH plan, Peduto's administration wants the URA to borrow $22 million, via a bond issue, and work with banks to offer competitive loans to would-be owner occupants of houses in the city. The URA would also use $4 million it already has on hand to offer second mortgages, at no interest and with deferred repayment terms, of as much as $40,000 each to the same buyers, for use in rehabilitating the houses. The program could help to put some 100 vacant houses into the hands of owner-occupants who might not otherwise be able to buy them, URA staff told the board at its monthly meeting. URA staff asked the board to allow the agency to approve the $22 million bond borrowing, in principle. That would allow the URA to go to the Pennsylvania Housing Finance Agency [PHFA], next month, to get approval to incur tax-free bond debt. The board asked questions after URA staff shared very preliminary guidelines for the eventual loans. Among the details: Board member Jodi Hirsh said that in light of those rules, she wanted to "ensure this doesn't become a tool that gentrifiers can use. … It's something I'm deeply concerned about." Board member Ed Gainey, who is also a state representative and a challenger to Peduto in the Democratic mayoral primary, said a lot of residents of struggling neighborhoods "don't see themselves invested in this program at this point in time." Gainey joined other board members in saying that the program should be structured to help address the gap in home ownership rates between Black and white Pittsburghers. Depending on the final guidelines, the program "could say ... whether we're going forward or backwards" in addressing that disparity, he said. Even Lindsay Powell, a board member who is also an assistant chief of staff to the mayor, said she has "a lot of concerns about this program." She said that many abandoned houses in the city require more than $40,000 to be made livable. "How do we bring them back to usefulness and restore them?" "I think we all recognize that this [program] is a single, this is not a home run," said Greg Flisram, the URA's executive director. The agency and city, he added, will need to "scale this up to the point where we can actually make more than just a dent in the problem." URA staff told the board that before any program rules are final and any money is borrowed, there will be a multi-month process and further board votes. Only after multiple board approvals would the agency borrow the money, possibly this summer. The board voted unanimously to give its initial approval to the concept, allowing the URA to seek PHFA's approval to incur debt. Thirty lots in Garfield that are now either vacant or include abandoned houses will eventually become the sites of 25 new rental homes – and may eventually be owner-occupied – under a plan approved by the Urban Redevelopment Authority board. The board voted to approve a $1.25 million loan from the Housing Opportunity Fund Rental Gap Program to a development team made up of the Bloomfield Garfield Corporation [BGC] and Gatesburg Road Development. That loan becomes part of a $9.4 million package – mostly low-income housing tax credits – that will cover purchase of the publicly owned properties and construction. Garfield is "being buffeted by market-rate activity that obviously we cannot control," said Rick Swartz, the BGC's executive director. The new homes will help to retain a mix of incomes and a balance of rental and home ownership in the community, he said, as well as "recycling a lot of city-owned property." To be eligible, would-be renters must have incomes well below area median incomes, and roughly half of the units will be reserved for households that are otherwise homeless or have special needs. When the new houses turn 16 years old, the tenants will have the opportunity to buy them at affordable prices, he added. They will not be obligated to buy. The houses could be completed by late next year. Tenants and landlords in Allegheny County who are waiting to apply for government help with rent payments can start submitting applications Monday, officials said in an interview with PublicSource and WESA. The nearly $80 million program promises to be more streamlined than last year's rent relief effort, according to Erin Dalton, director of the county's Department of Human Services. "We're staffed up to run the program from the beginning knowing this is a very large program," she said. Applications will be taken, starting at 8 a.m. Monday, via this web page. The county has, until now, used that page to collect contact information from people interested in the program, and around 3,000 have signed up for notifications. Unlike last year's rent relief bid, there is no limit on the monthly aid, which can cover rent and utility bills that are overdue and coming due. There is a monthly cap of 12 months of aid, but that can be extended in some cases to 15 months. Payments will generally go to landlords and utilities, but if those entities are not cooperative then payments can go directly to tenants. Tenants can self-certify that their circumstances have been worsened by COVID-19, and won't have to provide the kind of documentation required last year. The application process should be easier this time, with the creation of a web interface that allows tenants to create accounts to which they can return in order to submit more documentation, if that's needed, according to county officials. County officials were unable to provide a firm deadline for receipt of applications, saying that was subject to legislation still moving in Washington, D.C. They also declined to estimate the time it will take to start issuing payments, noting that could be affected by the volume of applications. Last year the county attempted to run its own rent relief program alongside of one run by the state. While the state set a per-tenant maximum of $750 a month in relief, the county doubled that to $1,500, and added as much as $200 in utility aid. The county and contractor ACTION-Housing tried to direct applications to one program or the other according to need. By early November, though, the county had accepted less than 11% of its applications, PublicSource and WESA discovered while reporting their joint series, Tenant Cities. The county eventually stopped trying to route tenants through the state program, relying solely on the county's federal aid allocation. By January, with the application process closed, the county had granted $14.7 million to 3,623 households. That reflected 48% of the 7,572 applicants. People who received rent relief last time, or were denied it, can try for aid this time, too, but must reapply. This time around the federal government is allocating nearly $850 million to Pennsylvania. Of that, $27 million of that is slated for Allegheny County, $8.9 million to the City of Pittsburgh, and the state is contributing another $43 million from its allocation to the county. The county and city decided to pool their resources into a single program. While the federal government, Allegheny County Court of Common Pleas, and City of Pittsburgh government have curbed evictions during the pandemic, some landlords continue to file such cases against tenants. PublicSource and WESA today reported on The Alden South Hills apartment complex, at which the landlord filed 37 eviction cases in January and February. Dalton says the county has liaisons with the district judges who hear eviction cases, and is distributing information about the rent relief program in coordination with those offices. The county is also funding seven drop-in centers at which people can get help applying for rent relief, and has created an online tool kit that organizations can use to get the word out about the program. Pittsburgh Mayor Bill Peduto announced a $22 million plan to fund home ownership and home rehab programs via the Urban Redevelopment Authority [URA]. In a press release following a press conference, Peduto's administration described the plan, called OwnPGH, to offer would-be owner occupants of homes loans at "competitive interest rates." If the URA's board approves the plan, potentially at its meeting tomorrow, that agency will borrow $22 million that it can then use to issue loans. It would pay off the debt using borrower repayments. The URA would also lend as much as $4 million of the money as second mortgages with deferred repayment terms to borrowers who want to rehabilitate homes. Individual borrowers would be eligible for as much as $40,000, or 20% of the property purchase price, whichever is less. "Cumulatively these efforts of OwnPGH will not only get vacant homes and lots back onto tax rolls, but improve neighborhood quality of life and help Pittsburghers accomplish the dream of home ownership," Peduto said in the press release. The administration also announced attempts to revive the moribund Pittsburgh Land Bank, charged with putting abandoned, publicly owned properties into private hands. Diamonte Walker, deputy director of the URA, will also become the land bank's executive director. Greg Miller, now a senior urban designer for the New York City Department of City Planning, will become its manager. Chatham University's 10-year expansion plan cleared the City Planning Commission, but with conditions spurred by neighbors worried about traffic, parking and transparency. Chatham's proposed new institutional master plan calls for the addition, over a decade, of around 240 new dorm beds, plus classrooms, labs and athletic facilities meant to accommodate 10% growth in the Squirrel Hill North campus – but just 11 more parking spaces. That's in synch with the city's drive toward less parking and more cycling, walking and transit. But neighbors are worried that students will end up parking on adjacent streets. "We are already having difficulty parking in front of our own houses," said Deborah Zuroski, one of eight residents of Murray Hill Avenue who testified at the commission's hearing. "We will be walking a block and a half with our groceries." Vanessa Spiro, also of Murray Hill, called her street "a beautiful, historic, meandering road" that risks "being turned into an off-ramp for the school." Chatham owns three houses and several vacant lots on Murray Hill, and two of the five entrances to the campus come off of the short avenue between Fifth Avenue and Wilkins Avenue. Residents complained that they had not gotten a meeting about the plan with Chatham officials until the night before the planning commission hearing. Chatham's development team answered that there had been public meetings before the Squirrel Hill Urban Coalition and the Shadyside Action Coalition. Urged by residents to delay their vote, commission Chair Christine Mondor said there was "a lot to like in this plan," and instead led the panel to approve it – with conditions. The commission stipulated that the university must meet with Murray Hill residents and discuss traffic patterns, the futures of the Chatham-owned houses on the street and the creation or maintenance of buffers between the campus and its neighbors. With that condition, and the unanimous approval of the commission, Chatham's plan goes to Pittsburgh City Council for final consideration. A pilot inclusionary zoning program has spurred the development of 40 affordable homes in Lawrenceville, according to Pittsburgh's Department of City Planning, which is asking the City Planning Commission to consider making the program permanent. Inclusionary zoning is a set of rules that compel developers to make some new apartments or for-sale homes affordable, if they want to price the rest at market rates. In 2019, the city required that developers who want to build 20 or more houses or apartments in fast-growing Lawrenceville ensure that 10% of them are affordable to households with modest incomes. Originally an 18-month program, inclusionary zoning was extended in January through July 25. If the commission and Pittsburgh City Council both vote to make it permanent, the city can also later consider extending the practice to other neighborhoods, said City Planner Christopher Corbett. The commission expects to hold an April 6 public hearing, and then vote on whether to make the Lawrenceville program permanent. Commissioner Sabina Deitrick said she'd like some more data before voting. "How many units did we think were going to happen during this phase?" she asked planning department staff, during the commission's biweekly meeting. She also asked to know, "what's in the pipeline." If the commission approves, council could follow with a vote in May or June. The City Planning Commission voted to approve a 42-unit apartment building that would welcome residents displaced from the demolished Penn Plaza apartments. The building will front on 121 North Beatty Street, now the site of a parking lot. Two weeks earlier, the commission had heard TREK Development and its architects describe the proposed four-story building in a briefing. John Ginocchi, vice president of TREK, reiterated that the project will "give a preference to former Penn Plaza residents" as tenants, and that low-income housing tax credits on which it relies will compel long-term affordability. No opposition emerged at this phase, the public hearing and vote. Pittsburgh City Council unanimously approved legislation that would largely bar the filing by landlords of eviction cases against city residents during the pandemic emergency, despite concerns on the part of some officials that the legislation may be difficult to enforce. Councilwoman Deb Gross, who has been spearheading the bid for a citywide eviction moratorium, amended her own bill, requiring that landlords seek a waiver from the Commission on Human Relations before filing to oust a tenant. The commission could then grant the landlord permission to file for eviction if a tenant was a threat to themselves, or others, or was engaging in criminal activity. "We should not be putting those tenants and those landlords into that process" of eviction hearings, blemished credit and possible ejection from housing, Gross said. Landlords who filed to evict city tenants without going through the process could face a $10,000 fine. For more than two hours, council heard public comment on the eviction legislation and debated the amendment. Of the 16 members of the public to comment, 15 called for a strong ban on evictions. The other public speaker, representing the Pennsylvania Apartment Association, said the legislation could make it too hard for landlords to evict tenants who could harm others. Councilman Rev. Ricky Burgess asked council to delay consideration by one day, to consider another amendment proposed by Mayor Bill Peduto's administration. "We're in that political season," Burgess said. "But I'm always very fearful of giving false hope" by passing "legislation that we can't enforce" and as a result giving "these very needy people no help." Burgess abstained from a vote on the amendment, but joined the other council members in voting for the amended bill. It now goes to Peduto, who can sign or veto it. Landlords filed 312 new eviction cases in Allegheny County in February, slightly down (in a shorter month) from the 366 filings in January. The case filings continue amid a federal curb on evictions which expires at the end of March, new, temporary Allegheny County Court of Common Pleas rules for handling such matters and a likely imminent Pittsburgh City Council vote on more stringent rules that would restrict city landlords. Council action would not affect evictions in the suburbs. Data collected by Carnegie Mellon University's CREATE Lab indicates that since the pandemic, more than two-thirds of the evictions filed in Allegheny County have involved defendants that live outside of the city's boundaries. PublicSource and WESA today published the second installment of their series Tenant Cities, which explores the region's changing rental housing market in the COVID-19 era. A Pittsburgh Land Bank which has done little, since its creation in 2014, to put publicly owned properties into private hands would get new powers under legislation being introduced in Harrisburg, Mayor Bill Peduto's administration announced. State Sen. Wayne Fontana, D-Brookline, wants to allow the land bank to buy properties at sheriff's sale just by paying the outstanding claims and liens, even if another entity bids higher, according to a press release. Philadelphia's land bank has similar powers, according to the release. That could be an alternative to taking properties through the Treasurer's Sale process, which Fontana described in the release as "a selective, long, and faulty process." That process is subject to state laws and local procedures that result in years-long waits for people seeking to buy city-owned property. The Pittsburgh Land Bank was meant to streamline such transfers. "Since its creation, the land bank has been having difficulty clearing titles on properties and has only been able to fully acquire few properties," the Peduto administration confirmed in its release. The mayor added that Fontana's legislation "is what we need to finally turn it into the powerful, blight-fighting tool we expect it to be." Fontana indicated in a memo announcing the impending introduction of his legislation that 30,000 parcels in the city are vacant or distressed, costing the city $4.8 million in tax revenue. News from the City Planning Commission, Urban Redevelopment Authority, Housing Authority of the City of Pittsburgh and more Crossing a line? A boundary change adds to tension between the Penguins and a key Hill District group Affordable for-sale housing at the front door of the mayoral election Tenant Cities: Rent relief didn't get to those who needed it. Will Pennsylvania get it right the second time? Tenant Cities: Going it alone in Allegheny County 21, 20, 19 … As Pittsburgh counts down to a new year amid the COVID-19 economy, 2020's development questions await 2021's answers. 'A big elephant in the room.' A McKeesport mother's months-long battle to save her house has her home for the holidays, with a deadline looming. House hunters: How an anti-blight law has become a tool for ambitious landlords in Allegheny County All on board? Powerful Pittsburgh-area panels are more diverse, but progress is uneven January development coverage Rich Lord is PublicSource's economic development reporter. He can be reached at [email protected] or on Twitter @richelord. Develop PGH has been made possible with funding from The Heinz Endowments. This article was produced by PublicSource.org, a nonprofit news organization serving the Pittsburgh region. PublicSource tells stories for a better Pittsburgh. Sign up for their free email newsletters at publicsource.org/newsletters.