ITHACA, N.Y. — A double feature this month, loyal readers. Alongside the usual and substantively light Planning and Economic Development Committee (PEDC) Wednesday night, is the Special Common Council meeting on the conference center vote and break-in access for Fifth Street off Route 13.
Special Common Council Meeting: Conference Center gets green light
So this gets a little complicated. The background story is that the conference center is part of the Vecino Group redevelopment of the Green Street Garage. After months of meetings, they’ve found a way to make the conference center feasible, and meet the city’s specifications as defined by two studies done in 2017 and 2019.
Vecino would build the project out with its own privately-raised money; it would use heat pumps, use local labor, pay living wages, meet the demands of the Green Building Code, and the Asteri portion would provide over 200 units of affordable housing. That’s all well and good. The city leases the conference center for 30 years, entering into a lease agreement with an entity to be created that would operate the conference center. The annual rent would be about $1.5 million.
To pay for the conference center’s operation, the city would establish a new hotel occupancy tax, since the hotels would be the biggest beneficiary of the conference center (studies indicate it would create 22,000 new overnight room stays countywide). Pending approval, the county would dedicate a portion of its tax to the operating costs as well, about $120,000/year to start, and expected to increase with growth of the local hotel industry to about $153,000/year.
If that’s not enough to cover operating costs and debt payments, a Primary Operating Reserve of $500,000 will be ready to cover bad tourism years or coronavirus crises and the like. They expect this will be tapped into as the conference center gets up and running; it takes time to become known to event planners and organizers, and so there will likely be an operating deficit in the first few years. Think of this as the green level of an alertness scale — the first failsafe.
In addition to the city’s funds via the hotel tax, the Downtown Ithaca Alliance would contribute $50,000 per year to a Secondary Operating Reserve for ten years (accruing $500,000), and if in the following twenty years it’s dipped into (years 11-30), the DIA will refill back to $500,000. This is like the code yellow on that alertness scale – getting a bit dicey, but it can happen in a bad year.
Furthermore, four Downtown hotels that stand to benefit the most – the Hotel Ithaca, the Hilton Garden Inn, the Marriott Downtown Ithaca and the Hilton Canopy, have agreed to pay $100,000 towards the construction costs, collectively pay $50,000 per year to sponsor the conference center for the first ten years, and create a Tertiary Operating Reserve of $100,000 to be maintained for the first ten years of conference center operation. If the conference center taps into this, it’s like a code orange on the scale, a bad sign.
In this event, the financial management board has to call in outside experts to advise on how to get the center back on track financially.
The last step, the code red emergency, last funding option before total closure, is the Final Operating Reserve of $1.25 million, paid for with hotel tax collections prior to opening in 2023. There will also be a Capital Replacement Reserve of $500,000 to renovate and replace furnishings, a rental reserve of at least two months of lease payments ($300,000) to ensure adequate cash flow for the operating entity.
Obviously, the goal is to make the conference center self-sustaining, avoid closure and to tap into as little reserve money as possible. But they need to have that financial contingency there. No one wants a financial anchor around the city’s neck – if the conference center were to close, the city is still on the hook for that 30-year lease of the space, and that would come out of the city’s General Fund to pay for its bills.
Wednesday’s vote accomplishes a few things. It commits to execute the conference center lease with Vecino, it establishes the new hotel and AirBnB tax, gives the go-ahead to create the reserve funds, and dedicates the hotel tax revenue to the conference center and its final reserve fund. The county and hoteliers also have to finalize their commitments before anything is executed.
So, with that explained, now to the actual discussion.
Nels Bohn of the Ithaca Urban Renewal Agency (in charge of executing the lease), Tom Knipe from the city’s Planning Department, and Jennifer Tavares from the Tompkins County Chamber of Commerce were there to speak on the proposed agreement. With all the focus on tourism and visitors, the coronavirus came up more than once during the debate.
“While things might seem a little uncertain right now, communities generally rebound and respond to economic changes…Remember just a few short weeks ago, we were in recovery mode. There’s no reason to think things will be any different once we get through this patch,” said Tavares.
“Businesses and shops can get through winters and school breaks, but it ends up being feast and famine. What a project like this would do, it would be fewer famines between those feasts,” said Mayor Svante Myrick.
Councilor Cynthia Brock (D-1st Ward) expressed strong reservations, citing uneasiness about the financial obligation should the worst-case scenario play out, which she suggested might happen with the rapidly escalating COVID-19 pandemic. Her argument was that even if visitors do eventually come back, the operating reserve may not be large enough when the conference center opens. “I am dubious that in these next two years, that we will have the reserves we need to rely on to cushion the operations.”
Her ward colleague, councilor George McGonigal (D-1st), was more receptive, but had reservations of his own. “It does seem to me that a conference center would be a great benefit to the downtown hotels, so I don’t understand why the hotels are only committing to a 10-year agreement when there’s a 30-year lease, given that some of the unexpected expenses might be at the tail end of that lease.”
“Ten years is to allow the project to achieve stabilization, which is expected to happen in year five, “ Tavares replied. “Should there be something substantially problematic, all the parties would need to come together and evaluate what changes are necessary to move forward and be successful. Making a commitment for a ten-year period of time is actually a pretty long commitment (for a business).”
Councilor Donna Fleming (D-3rd Ward) expressed frustration that the tax would be dedicated to the conference center when it could be useful for other projects. Councilor Seph Murtagh (D-2nd Ward) spoke about the need for affordable rental space for community organizations. Councilor Graham Kerslick (D-4th) shared his displeasure that people traveling to Ithaca to attend conferences may come via plane or car, and work against the goals of the Green New Deal.
“I think it’s fair to say there is some trepidation tonight, no one wants to put the city on the hook for a boondoggle. I think this is a well-thought-out proposal, if this works out I think it will be a benefit for the community. But is there still an opportunity for the council to weigh in on this further?” Asked Murtagh.
It will formally come back for local law adoption, “but a whole lot of commitments will be made by then”, replied city attorney Ari Levine. In other words, no, this was pretty much the last real chance to weigh in.
It was starting to look like a vote would fail. With councilor Rob Gearhart (D-3rd Ward) absent, a 5-4 vote in favor would actually fail, since they need six yes votes. Fleming and Brock were clearly not fans, Kerslick had expressed discontent and could go either way, and McGonigal had effectively become a swing vote.
McGonigal used this to his advantage. He asked for the hotels to commit $150,000 in their reserve and maintain it for 20 years. Tavares responded that $150,000 may be possible, but twenty years would likely not.
“I’m walking across a frozen pond and I don’t know how thick the ice is. If Tom and Nels think it’s better to stay at ten years and $150,000, I’ll move to ten years. But if the DIA is willing to do 30 years, I don’t see why the hotels aren’t willing to do the same thing.” With assurances from Tom Knipe, McGonigal withdrew his 20-year request, but the agreement was amended 9-0 to have the hotels commit an extra $50,000 to the reserve. With this change, the Common Council voted on the lease execution agreement. It passed on a 7-2 vote, with Fleming and Brock opposed.
Council advocates for opening up Fifth Street
For the record, “break-in access” is a Department of Transportation (DOT) term for accessing a state highway. One connection is already planned as part of the Carpenter Park redevelopment as a three-way intersection, and potentially a four-way intersection if the existing north end of Fifth Street is opened up. The way it works is that Common Council votes to submit a request to the NYS DOT. City planners and engineers have been meeting with DOT to go over the possibility and acceptable mitigation for traffic impacts and the like – no one wants to put something forward without DOT being likely to agree to it. It’s a lengthy approval process via the regional office in Syracuse and state headquarters in Albany, and the break-in access needs to demonstrate community benefits (through Carpenter Park’s build-out, in this case).
Per discussions, residents have been strongly opposed to opening the existing part of Fifth Street to Route 13, enjoying the peace and quiet of what’s currently a defacto cul-de-sac. City staff speaking on behalf of the agenda item, planner Lisa Nicholas and transportation engineer Tim Logue, noted that the city was asking the project team for Carpenter Park to remove the tear-drop shaped rotary due to potential backups and risks.
There was discussion about NYSEG’s role, and perhaps opening Fifth Street to bikers and pedestrians but not cars. Councilor Brock advocated for the four-way intersection, though with reservations with respect to traffic delays. Councilor Fleming said she was okay with four-way because engineer Logue preferred it, and because of better connectivity. The final designs will be back before the full council in May to create the formal request. In the meantime, councilors Laura Lewis (D-5th Ward) and Murtagh plan to reach out to the community and neighborhood group Northside United to discuss the Fifth Street proposal.
PEDC: South Cayuga Street Bridge to Get Makeover
Now, on to the meeting you came here to read about.
First up, the South Cayuga Street Bridge over Six Mile Creek, presented by city engineer Addisu Gebre. The city has three options to weigh for rehabilitation of the 53-year-old bridge. The original plan was to reduce the 13-foot wide traffic lanes to 10 feet wide, and widen the sidewalks from 5 feet to 8 feet, but NYS DOT rejected it for posing a risk to bicyclists. So now we have new options.
Option 1 is to rebuild pretty much as-is, rebuilding the bridge’s superstructure and widening the sidewalks five inches (to 5’5″) to comply with state regulations and keeping the 13′ traffic lanes. This would have a 35-40 year life, given that some of the existing structure would be retained. The cost would be $2.07 million, mostly federal dollars with the city paying $434,000.
Option 2 is a bridge rehabilitation with a new deck, widening the substructure to accommodate a wider bridge with two 8′ wide sidewalks. This would also have a 35-40 year life, since some structural components would be retained. It gives the city the wide sidewalks it wants, and could start construction this year. The cost would be $2.564 million, with the city’s tab being $794,000 (the federal portion is fixed, with some other minor funding also available).
Option 3 is a full bridge replacement. New bridge, new deck, new 8′ sidewalks, and being all-new, it’d have a 75-year lifespan. Cost: $3.84 million total, $2.046 million to the city. The Department of Public Works prefers this option, but it would also take the longest time to get built because it’s a totally new bridge.
The PEDC saw things to like with both options 2 and 3. Councilor Steve Smith (D-4th Ward) advocated for Option 2. “The dollars per year just seem to make sense,” Smith said.
Fleming agreed. “For a third as much money, you get half the life-span.”
The PEDC wasn’t comfortable deciding between Options 2 and 3 and unanimously decided to send them both to the full Common Council next month to make a decision.
Council weighs short-term rental (AirBnB) regulation
Up for non-voting discussion at the meeting was a topic that has seen increasingly debate in the past couple of years – short-term home rentals, like AirBnBs. The purpose of tonight’s discussion wasn’t to get in the technical details so much as to develop a sense of direction, since Council didn’t feel comfortable moving Accessory Dwelling Unit (ADU) legislation without also having short-term rental legislation moving through in tandem.
Deputy planning director Tom Knipe explained that they could do more research and commit to do a “community conversation” (an open house/meeting) to discuss what Ithacans are comfortable with in terms of what people should be allowed to do and what tools for enforcement they should have in their repertoire. Knipe noted that the county’s enforcement is more focused on making sure the room tax is collected, so rules on things like the number of allowed rental nights would likely be a part of city enforcement.
The general sentiment from PEDC was that some degree of short-term rentals should be allowed but be closely regulated, “limited legal right” as councilor Fleming put it. Fleming added she wants the financial incentive for owners to be with leasing long-term rentals for residents rather than short-term spaces. Councilor Brock stated she was open to short-term rentals, but had concerns about saturation and wanted limits on the number of short-term rentals allowed.
“A lot of people do this, there’s been a tradition of it in places like the (Southside) Flats. I want to preserve that while cutting down on the abuses,” said Committee Chair Murtagh.
“If it’s owner-occupied, then the rules should be pretty lax. But if it’s not owner-occupied, there should be a significant limit on the number of days you can do it,” added councilor Smith.
The real difference between councilors came down whether renters could host short-term rentals. Generally, those in more renter-heavy neighborhoods were in favor, those from more owner-occupied neighborhoods were not. But as long as long-term renters aren’t being pushed out for short-term visitors, it was something the PEDC was willing to allow.
“I’m wary of us not being able to do something concrete on short-term rentals, but I am comfortable that we have a plan moving forward. I’m glad we have this plan for community input and enforcement guidelines,” said councilor Lewis.
On a final note, the PEDC briefly looked at allowing backyard chickens at the Nate’s Floral Estates mobile home park (all the homes are on one tax parcel, so the law treats the property as one house), but the legislation was postponed after concerns were raised about the soils on site. The southern part of the park used to be the county dump, and by order of the Department of Health, residents have to use raised plant beds to grow plants for food. The concern was that the chickens and eggs would be consumed and pass on the soil contents to their consumers.