Minutes of the Meeting of the CDBG Commission
January 26, 2012
Members Present: Linda Begley-Korth, Pluma Cool, Ron Johnson, David Phillips, David Ripp, Gail Shea,
Cynda Solberg, Gus Vander Wegen, Donna Vogel
Members Absent: Brian Bigler, Richard Oberle (excused)
Staff and Others Present: Lori Bastean (staff), Leslie Hamilton (staff), Larry Klein, Rachael Kramer, Ken
Krantz, John Lehman, Barry Levinson, Matthew Levinson, Patti Levenson, Kevin Mahoney, Olivia Parry
(staff), Jan Reek, Jim Rowe, Rebecca Schettler-Peterson, Val Steel, Jenna Wuthrich (staff).
Call to Order: Chair Donna Vogel called the meeting to order at 5:30 p.m.
Discussion and Action on Minutes of 12/8/2011 Commission Meeting
A motion to approve the minutes of the December 8, 2011 Commission meeting was made by Ron Johnson,
seconded by David Phillips. Motion carried 6-0.
Announcement of Possible Closed Session pursuant to WI Statute 19.85(1)(g)
Chair Donna Vogel announced that the Commission may vote to close the session pursuant to WI Statute
19.85(1)(g)…”conferring with legal counsel for the governmental body who is rendering oral or written advice
concerning strategy to be adopted by the body with respect to litigation in which it is or is likely to become
Public Comment on Items not on Agenda
There was no public comment on items not on the agenda.
Information to be Provided to Citizens as Part of Public Hearing for Input on the Substantial
Amendment to the 2008 Action Plan Regarding CDBG-R Funds
Information and handouts regarding eligible activities, amount of funds available and amount expected to
benefit low-and-moderate income persons, and displacement plans and notices related to the CDBG-R
funds was covered by Lori Bastean.
The Substantial Amendment proposes to reallocate unused administration and mental health diversion
facility dollars to minor home repair.
Public Hearing for Citizen Input on Substantial Amendment to the 2008 Action Plan
Chair Donna Vogel opened the public hearing on the substantial amendment to the 2008 Action Plan at 5:33
p.m.. There being no persons registered to speak, the public hearing was closed at 5:34 p.m.
Discussion and Action on Substantial Amendment to the 2008 Action Plan
MOTION: A motion was made by David Phillips, seconded by Linda Begley-Korth to approve the
Substantial Amendment to the 2008 Action Plan as presented. Motion carried unanimously, 6-0.
Gus Vander Wegen and Cynda Solberg arrived at 5:34 p.m.
Gail Shea arrived at 5:35 p.m.
Request for Waiver of Homeowner Loan Subordination Requirements Disallowing Cash Out
Jenna Wuthrich presented the request by Rebecca Schettler-Peterson for a waiver of the County’s
homeowner loan subordination requirements disallowing cash out financing. The borrower is requesting the
subordination to combine the primary loan and home equity line, pay back property taxes, and consolidate
debt. Doing so will allow the borrower to afford to escrow for property taxes going forward. Ms. Schettler-
Peterson has resided in the home for 20 years and had been current on her taxes until encountering health
Ms. Schettler-Peterson and Ken Krantz representing the Bank of Deerfield registered in support and were
available for information only.
Discussion and Action on Request for Waiver of Homeowner Loan Subordination Requirements
Disallowing Cash Out Financing
In response to a question from Donna Vogel, Jenna Wuthrich indicated that this was allowable under the
CDBG/HOME programs as the County had developed the policy. Exceptions to that policy go before the
CDBG Commission for action.
MOTION: A motion was made by Ron Johnson, seconded by Linda Begley-Korth to approve the
request for waiver of the homeowner loan subordination requirements disallowing case out financing
for Rebecca Schettler-Peterson. Motion carried unanimously, 9-0.
Request by Project Home for an Addendum to the 2011 HOME Contract in Order to Provide
Homeowner Rehabilitation Outside the Village of Blue Mounds
Jenna Wuthrich presented a request by Project Home to be able to use 2011 HOME funds for housing
rehabilitation on a County-wide basis. She covered information in a memorandum regarding the marketing
efforts that were conducted in order to identify enough qualified homeowners in the Village of Blue Mounds
in order to complete their contract. This included distributing flyers, holding a community meeting, posting
information at the Southwest Dane Senior Outreach Center, sending packets of information to the local
Building Inspectors, providing information packets to the Board of Trustees, and sending applications with
cover letters to 17 homeowners.
Jan Reek, Director of Programs, for Project Home noted that the review was a fair assessment. They are
not anticipating any problems in getting applicants for the remaining funds. Applicants may come from any
of the participating jurisdictions of the Dane County Urban County Consortium.
Discussion and Action on Request by Project Home to Addendum the 2011 HOME Contract
MOTION: A motion was made by Linda Begley-Korth, seconded by Ron Johnson to approve the
request by Project Home to addend their 2011 HOME contract in order to provide homeowner
rehabilitation outside the Village of Blue Mounds. Motion carried unanimously, 9-0.
Request for Adjustment to Loan Deferral for Cambridge Stoneware
Jim Rowe, Owner of Cambridge Stoneware, provided background on the current situation. He mentioned
that in planning for this year, he looked at how the level of payments had changed and what he would be
able to afford. He related that he had found a potential tenant, who was just approved for a business loan,
for the unused half of the building. Cambridge State Bank has approved a three year lease with the new
Jim Rowe noted that his sales reflect the seasonal nature of his business. December is the top sales month
of the year and in January we do 10% of what we do in December. He is looking at how to increase sales
during January – June. He went on and described a project with NW Masonry & Stone to make large
architectural tile blocks for the restoration of the Cudahy Towers in Milwaukee.
Jim Rowe stated that his request to the CDBG Commission is to:
• Make interest only payments January – July, 2012
• Pay principle and interest August 2012 – August 31, 2014
• Reduce the interest rate to 4.25%
• Continue with the existing 10 year loan term
The key to me is to be able to fulfill the promises we make in this meeting.
Olivia Parry provided a historical overview of the loan and prior actions by the CDBG Commission. The loan
balance is $89,642.44. The building that was owned by Jim Rowe and leased to the business is in
foreclosure with a Sheriff’s sale expected in March. The general thinking is that the building will not sell. If
that is the case, the Bank of Cambridge will enter into a month-to-month lease with the business. The kiln is
custom made for the building.
In response to a question from David Phillips, Jim Rowe indicated that he did not have a written contract
with NW Masonry & Stone adding that he just has been working with them since December and it was very
early in their relationship. However, he added that there is business out there. David Phillips then
confirmed with Jim Rowe that there was no guarantee that he would get the work to which Jim Rowe added
that he only had a verbal agreement with NW Masonry & Stone.
David Phillips also questioned the lease with the Cam-Rock Café. Jim Rowe explained that he had drawn
up the three year lease with the Café which the Bank of Cambridge had agreed to honor. With the building
in foreclosure, the Café will make payments to the bank. In response to a question from Pluma Cool
regarding the pending Sheriff’s sale, Jim Rowe said that the overwhelming thought is that the Bank does not
expect anyone to bite.
There was additional discussion regarding the kiln. As the kiln is built for the building, Pluma Cool pointed
out that if could be an issue if the building were sold. Jim Rowe said it would be somewhat problematic to
move the kiln requiring it to be taken out in pieces. He stated that he could sell the kiln today for $10,000
but has it for sale at an asking price of $90,000. David Phillips noted that selling the kiln would negate the
business to which Jim Rowe acknowledged he would prefer to keep the kiln. Ron Johnson pointed out that
the kiln was the County’s security on the loan to which Jim Rowe related that upon the sale of the kiln, he
would come traipsing over with payment.
Discussion and Action on Request for Adjustment to Loan Deferral by Cambridge Stoneware
Linda Begley-Korth raised the possibility of postponing discussion until March after more details are known.
Donna Vogel confirmed with Jim Rowe that no date had been set for the Sheriff’s sale. In response to a
question from Donna Vogel about whether the 2008 and 2009 property taxes had been paid, Jim Rowe
indicated he did not know. Donna Vogel added that if taxes are outstanding for a third year, then the County
may take ownership of the building.
MOTION: A motion was made by Linda Begley-Korth, seconded by Cynda Solberg to defer action
on Cambridge Stoneware until the April 26, 2012 CDBG Commission meeting. Donna Vogel made
an amendment acceptable to each of the makers that this is with the recognition that the borrower
will continue to make interest only payments. Motion carried unanimously, 9-0.
Report on Progress in Meeting Conditions of Loan Deferral and Request for Extension of Loan
Deferral Term by the National Mustard Museum
Kevin Mahoney, Middleton Chamber of Commerce was registered to speak in support of the National
Mustard Museum request but had to leave prior to this agenda item.
John Lehman, Finance Director/Assistant City Administrator for the City of Middleton spoke in support of the
National Mustard Museum relating that it is a key piece of downtown Middleton. The City of Middleton is
doing a buy-down of the property housing the Museum paying $1.4 million to the building owner HP
Holdings. This reduces the space cost for the Museum. There is a $37,000 request before the CDA for
assistance with paying off a bank loan for the business. A local accountant has been retained to assess the
financial condition of the Mustard Museum prior to action being taken on this request. In addition, the City of
Middleton is having discussions about constructing a parking ramp downtown.
Matthew Levinson, son of the Curator, noted that he was a little biased in his support of the Mustard
Museum, but that he would try to make his comments as objective as possible. He related that not many
kids can say their parents own a Mustard Museum. At first his friends would make fun of the idea until they
visited the Museum and saw how cool it was. One of the things he has noticed is that due to the interactions
with his father at the Museum, visitors either leave laughing or with a smile on their face. The Mustard
Museum is something that brings that little bit of enjoyment in this economy. He added, “I believe in my
Val Steel, Director of Tourism for the Middleton Tourism Commission came to tell the Commission that
Middleton is on board with the Mustard Museum. Previously, Middleton had no draw, rather it had plenty of
hotel rooms and visitors would head into Madison or the Wisconsin Dells to spend their dollars. We want to
keep the visitors here, turn them upside down, and help them empty their pockets. When the opportunity
came to bring the Mustard Museum to Middleton, it gave us the opportunity to be more than just an
overnight place to stay. The Tourism Commission uses the Mustard Museum as a vehicle to attract motor
coach tours and conferences. Without them, we would need to reinvent ourselves again. Val Steel added
that the Tourism Commission supports the Mustard Museum through advertising and marketing.
In response to a question from Ron Johnson regarding the measurable impact of the Mustard Museum on
the Middleton economy, Val Steel commented that the circumstances that have brought them here today are
the same facing the rest of the businesses. However, she added that bus tours have increased 50%.
In response to a question from David Phillips regarding the purpose and terms of the CDA loan, John
Lehman explained that the loan originated from Amcore Bank which was taken over by Harris Bank and
then sold to Bayview Bank for servicing with refinancing over a five year term being requested from the
CDA. The discussion with the CDA started last Tuesday so information on the terms is not available yet.
The financial package provided to the City of Middleton for review by the Mustard Museum was such that
the bottom line could not be easily determined.
Gus Vander Wegen inquired as to which CIP plan that the parking ramp was in. John Lehman replies that
TID #3 sunsets in 2020 with the last expenditures to be in 2015. In the discussion about drawing the funds,
the ramp proposal came forward. The City is putting out an RFP right now. The Mustard Museum has
35,000 visitors coming through annually.
Two additional persons were registered in support of the Mustard Museum: Rachael Kramer and Patti
Barry Levenson, Curator of the National Mustard Museum reviewed a handout on the good news (in store
sales in December up 34% with internet sales up 7%, 501(c )3 designation for the nonprofit museum has
been received, catalog costs down $17,000, $8,000 in donations from visitors); the challenging news
(building is in receivership, recession continues, no other tenants in building, high debt costs, and not having
hired the required number of employees); and initiatives facing the National Mustard Museum.
Barry Levenson iterated his request before the CDBG Commission for a one year deferral of the principle
and interest on the County loan until January, 2013. He related that this is not a good solution, but it the
only solution. The 501(c )3 will take time to get rolling. He added, “We at the Mustard Museum have a
saying – better late than ketchup.”
Olivia Parry provided a historical overview of the loan and prior actions by the CDBG Commission. No
payments were made February – July, 2011 and interest only payments have been made since August,
2011. July 28, 2011 the CDBG Commission decreased the interest rate to 4.25% and extended the loan
terms to 10 years. The outstanding loan balance is $178,073.29. 2.77 new jobs have been created out of
10 required in the contract. Leslie Hamilton pointed out that there is a discrepancy in the jobs required to be
created in the Loan Agreement with one paragraph requiring 8 FTE jobs and another requiring 10. She also
pointed out that the Commission had taken action in 2011 on the ED-RLF loans to reduce the number of
jobs required from 1 FTE per $20,000 invested to 1 FTE per $35,000 invested. These discrepancies can,
and should be, resolved.
In response to a question from Cynda Solberg about whether another year would be added to the loan,
Olivia Parry noted that interest would continue to accrue and that the monthly payments in January 2013
would go to $2,614.63 at an interest rate of 4.5%.
Cynda Solberg observed that this would be quite a jump in payments. She inquired from Barry Levenson if
this means he would be back before the CDBG Commission. Barry Levenson replied that he thought they
had turned a corner. We are seeing double the number of web site hits. Kurt Brown, travel writer, wrote a
good piece and we have been getting some good press.
David Phillips had a series of inquires regarding the financial statements provided by the Mustard Museum.
David Phillips commented that the museum and store financial statements appear to be intermingled, to
which Barry Levenson commented that these should be separate. The MOM stands for mail order manager
sales which are done over the Internet or done via mail order when a customer submits a paper order form.
The $31,000 in rental income received is paid from the Museum to the store as 37% of the space is the
Museum. Regarding the accrued guaranteed payments, Barry Levenson explained as it was expected by
the other owners of the Museum that I would take a salary; if the money is not there, I won’t take it but it
appears on the balance sheet.
David Phillips inquired as to the progress from the July 28, 2011 meeting when Barry Levenson presented
the plan for Marketing the Mustard Museum Into Financial Stability. Corporate sales of $75,000 were
expected. Barry Levenson explained that they only sold 250 cases rather than the 800-900 expected.
There were some other corporate sales. He added we need to do more, that’s our networking to
David Phillips observed that the loan to Barry Levenson’s mother had been paid off. Barry Levenson
replied, yes, she is going to be 90. He added longevity is on my side. I’ll be around for a long, long time.
Discussion and Action on Progress in Meeting Conditions of Loan Deferral and Request for
Extension of Loan Deferral Term for the National Mustard Museum
MOTION: A motion was made by David Ripp, seconded by Gus Vander Wegen to approve the
request by the National Mustard Museum to defer the payments of principle and interest for one
year until January 2013, then resume payments of principle and interest at the rate of 4.5% and to
extend the loan terms to 10 years. A friendly amendment was made by Donna Vogel, acceptable to
the makers, that the business is to provide jobs creation documentation in a format acceptable to
staff. Motion carried unanimously, 9-0.
Ron Johnson mentioned that a major concern is the jobs creation requirement. Donna Vogel added that the
jobs were to have been created within 18 months of the loan; these funds originated from the Department of
Commerce. Ron Johnson noted that the CDA may want to take over the loan since they don’t have the jobs
Donna Vogel observed that the County’s loan was under collateralized.
The CDBG Commission took a five (5) minute break.
Report on Establishing a RLF/CRLF Loan Application Review Subcommittee of the CDBG
Donna Vogel commented on the workgroup that is developing an RFP for underwriting services. The Office
of Jobs & Prosperity will get underway in April. The County Executive is getting ready to appoint persons to
fill the two current vacancies on the CDBG Commission and looking to the former RLF Committee for those
who may want to serve. The expertise of those persons go hand-in-glove with the additional expertise
optimally desired in a Loan Application Review Subcommittee.
Discussion and Action on Establishing a RLF/CRLF Loan Application Review Subcommittee of the
There was discussion as to the optimal number of persons on the loan application review subcommittee with
concern expressed that if the number was five, that two persons would result in a negative quorum.
There was discussion on whether a County Board Supervisor was needed on the subcommittee and
whether a third County Board Supervisor could be appointed to the CDBG Commission.
MOTION: A motion was made by Ron Johnson, seconded by Linda Begley-Korth to establish a
Loan Application Review Subcommittee of the CDBG Commission with a membership of 7. Motion
carried unanimously, 9-0.
Report on Anticipated 2012 Funding and Impact on Allocations for 2012 Activities
A spreadsheet comparing the CDBG Commission funding recommendations to the latest budget numbers
was reviewed by Lori Bastean.
Discussion and Action on Anticipated 2012 Funding and Impact on Allocations for 2012 Activities
MOTION: A motion was made by David Phillips, seconded by Linda Begley-Korth to approve the
2012 allocations as presented. Motion carried unanimously, 9-0.
Report on Meeting Sites, Program Activities, and Expenditures
A sheet on the meeting sites for 2012 was distributed.
Lori Bastean highlighted some of the program activities noting that the Loan Agreement for McKee Park
Apartments is being reviewed by HUD to determine if Independent Living may participate. Construction is
underway on the Middleton Heritage project. The contract with the Alexander Company for the Pheasant
Ridge Apartments is with the Alexander Company.
Pending changes to the HOME rules were briefly mentioned. Jenna Wuthrich commented that one of the
major changes would be that if within 6 months of completion of a newly constructed home, it were not sold
to an eligible low-and-moderate income homebuyer, it would need to be rented to an eligible tenant. This
has a major impact on Operation Fresh Start.
January 24, 2012 Jenna Wuthrich and Lori Bastean met with a representative from Milwaukee County
CDBG to review our allocation process and offer technical assistance. This was requested by the
Milwaukee HUD Field Office presumably as we are considered to be doing a good job. This is a significant
change from where we were four years ago.
Discussion and Action to be Taken Regarding Evidence of Default of the Terms Specified in the Loan
Agreement by Depot Hill
MOTION: A motion was made by Ron Johnson, seconded by Linda Begley-Korth at 7:40 p.m. to
close the session pursuant to WI Statute 19.85(1)(g)…”conferring with legal counsel for the
governmental body who is rendering oral or written advice concerning strategy to be adopted by the
body with respect to litigation in which it is or is likely to become involved.” The roll call vote: Cynda
Solberg – yes; Pluma Cool – yes; David Phillips – yes; Gus Vander Wegen – yes; Ron Johnson –
yes; Linda Begley-Korth – yes; David Ripp – yes; Gail Shea – no; Donna Vogel – yes.
MOTION: A motion was made by David Phillips, seconded by Ron Johnson at 8:03 p.m. to return to
open session. The roll call vote: Cynda Solberg – yes; Pluma Cool – yes; David Phillips – yes; Gus
Vander Wegen – yes; Ron Johnson – yes; Linda Begley-Korth – yes; David Ripp – yes; Gail Shea –
yes; Donna Vogel – yes.
Gail Shea commented that she wanted to follow-up on the idea of recertifying the financial information at the
time a business requests a modification of loan terms. Donna Vogel noted that we may want to charge a fee
for underwriting costs associated with a request for loan deferral.
David Phillips suggested trying to get Jason Felland to sign the promissory note. David Ripp noted that we
are relying on his goodwill to get the money. Will it scare him? I’m not sure that it gains anything. It’s not
going to help us. He has no collateral.
MOTION: A motion was made by Cynda Solberg, seconded by Gus Vander Wegen to accept the
offer of the Borrower to reduce the interest rate from 8.5% to 5% and to resume payments as of
February 15, 2012 with the current loan term. Motion carried unanimously, 9-0.
Adjournment: It was moved by Gus Vander Wegen, seconded by Linda Begley-Korth to adjourn to the
February 23, 2012 Commission meeting or at the call of the Chair. Motion carried unanimously, 9-0 at 8:15
Recorded by Lori Bastean
Note: These minutes are the notes of the recorder and are subject to change at a subsequent meeting of the Commission.
/cdbg commission – minutes of 1.26.2012.doc