SMNC“I’m proud to be a part of the organization,” says Ellis. “I keep learning new things and I hope to eventually buy my own home with the help of SMNC.” While all four

SMNCSYRACUSE MODEL NEIGHBORHOOD CORPORATION

ANNUAL REPORT 2012

Quality Housing That People Can Afford

I am pleased to announce that Syracuse Model Neighborhood Corporation has had a very successful year providing quality housing that people can afford. But

don’t just take my word for it – ask NeighborWorks America, the nation’s preeminent leader in affordable housing and community development!

This year SMNC participated in a comprehensive review by the Organizational Assessment Division of NeighborWorks America. Every facet of SMNC’s operation and management was reviewed and phrases like “significantly improved,” “excelled,” and “exceeded” were used to describe us.

I have always known that we have an outstanding staff who go the extra mile every day for our tenants and our neighborhood. It is always nice when that is recognized by someone else, especially a nationally known and respected

organization like NeighborWorks America.

We have also been able to finish much of the work that began last year thanks to several sources of grant revenue. The work that has been done will reduce energy costs for our tenants, make their homes more comfort-able, improve our curb appeal, add value to our portfolio, and continue SMNC’s longstanding tradition of being a good neighbor and steward of the environment.

In addition, SMNC is positioning itself for the future by conducting a comprehensive capital needs assessment of each of our 230+ units and establishing a fund to support the findings of that assessment.

Our Executive Director, Tom Francis and the dedicated staff of SMNC are really the ones who have made this all happen and truly deserve our thanks. They work tirelessly to transform our portfolio of houses and apartments into comfortable, safe, quality places that our tenants and their families can be proud to call home. While they can never be adequately compensated for their dedication to SMNC and our tenants, on behalf of the board of directors, I would like to say a very heartfelt, “thank you.”

MESSAGE FROM THE CHAIRPERSON

Jim Gaffey

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ON THE COvER

Meet the Dorseys! The Dorsey Family have beenproud residents in an SMNCproperty for three and a half years.

“Our family really enjoys living in an SMNC home. We enjoy our neighbors and believe that this is a great place to raise a family.”

Chairperson, James Gaffey

SYRACUSE MODEL NEIGHBORHOOD CORPORATION

2012 Board of DirectorsChairperson, Jim Gaffey, Syracuse Code Enforcementvice Chairperson, Kitty Rice, Neighborhood Resident Treasurer, Jack Salisbury, CPA, DiMarco, Abiusi & PascarellaSecretary, Cleo Brown, Neighborhood Resident Nancy McCoy, Neighborhood Resident Steven Coker, SUNY Upstate Medical CenterJocelyn Bowen, Neighborhood Resident D. Michelle Golembieski, JP Morgan Chase BankLuke Dougherty, City Hall Ethel Edwards, Neighborhood Resident Kelly Gaggin, Director of Marketing, United WayKesselly Karmara, Neighborhood Resident Diane Turner, Neighborhood Resident Kathleen Joy, AttorneyWalter Eiland, Neighborhood Resident Deputy Chief David Barrette, Police Dept.David Michel, Circle RdCarolyn Evans-Dean, Neighborhood Resident Joel Grant, Neighborhood Resident Eleanor Gerald, Neighborhood Resident Stephen Markley, Key Bank

StaffTom Francis, Executive DirectorDorothy Adams, Property ManagerL. Pierre, Maintenance & Construction CoordinatorTracy Gossiaux, Finance DirectorRosemary Oleson, Assistant Property ManagerNancy Williams, Administrative AssistantDavid Bass, Maintenance ForemanShamara Rufus, Finance Assistant Billy Rice, Lead Maintenance PersonRuel vassell, CarpenterEustacius Donai, CarpenterLouis Osbourne, MaintenanceWilliam Carter, MaintenanceCassandra Harris, MaintenanceMarcus Forbes, Maintenance

Apartment Building Superintendents:Robert Sauve, 107 E. Kennedy StWilliam Carter, 118 W. Castle StAnthony Bowman, 124 W. Castle StWinston Stewart, 451-57 Midland Ave

From the left: Dorothy Adams, Nancy Williams, Shamara Rufus, Ruel vassell, Louis Osbourne, Tracy Gossiaux, L. Pierre, Rosemary Oleson, Marcus Forbes, Eustacius Donai. In front is Dave BassMissing from the picture is Tom Francis, Cassandra Harris, Will Carter and Billy Rice

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RENTAL PROGRAM

The Property Manager, Dorothy Adams and her assistant, Rosemary Oleson, work with a tenant to alleviate an issue.

Rental Program - Our tenants are like family

SMNC owns and manages 101 rental properties. The majority (85) of the properties of are one- and two-

family houses and the remainder are apartment buildings. This represents a total of 233 units of housing in the City of Syracuse. Although a few properties are located on the City’s Northside, the bulk of our portfolio is on the South-side and Westside.

Property Manager, Dorothy Adams and her assistant Rosemary Oleson, spend a great deal of time helping our tenants solve problems. They listen to the tenants and make every effort to come up with a solution that benefits both the tenant and the organization. An example of the way we go above and beyond for our tenants: A family got behind in rent because the wife lost her job, did not report this to Section 8 or DSS. We took the tenant to court and won the eviction. After court, the tenant came in and told us her problem. Rosemary immediately got on the phone with her contacts at the Department Of Social Services. Dorothy also called her contact at Section 8. Between the both of them working on the behalf of the family, the prob-lem was resolved with Section 8 paying all of the owed rent which was in the amount of $1,200.00. Rosemary and Dorothy have formed an excellent working relationship with many different agencies (Catholic Charities, DSS, Section 8, other landlords, etc.) that they are able to help many of our tenants. They do this because they care.

Whether a tenant is having trouble paying their rent on time, experiencing problems with Section 8 or the Department of Social Services, Dorothy and Rosemary will arrange payment plans and offer counseling and advice on how to untangle bureaucratic obstacles and cut through the red tape. Their excellent working relationships with many different agencies enables them to go above and beyond for our tenants. They do this because they care.

In short, we try to treat our tenants like family. This is a good thing for our tenants but it also benefits SMNC. Because of our willingness to work with our tenants, we are able to collect 95% of the rent billed and have many tenants that have been with us for a long time. Our longest tenant has been with us for 35 years and an average tenant calls us home for a little over 5 years.

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Single family rental at 1431 S. Salina St.

Two family rental at 410-12 Cortland Ave.

Single family rental at 1615 S. Salina St.

BRIGHTON HOME CORP.

The Brighton Home Corp. Crew

The employees of Brighton Home Corp. (BHC) are much more than construction workers – they are advocates for, and believers in,

the neighborhood. Devon Watson, Ellis Barner, Bruce Gayle and DelroyYoung had different paths that led them to their jobs with BHC but what they have in common is initiative and the desire to work and better themselves and those around them.

Coming from Jamaica, Devon had a background in carpentry and masonry so when he saw SMNC’s Construction Coordinator, Pierre working on one of the SMNC homes he asked for a job. After speaking with Devon about his experience, Pierre offered him a job. Ellis found BHC when he was at a crossroads. He had made a choice to improve his situation, recently completed a carpentry class and was looking for an opportunity to put his new skills to work. Ellis met Pierre and was given the hand up that he needed. This is a common thread for all the men; each of them inquired about work and were given a chance.

In meeting these gentlemen it is obvious that they are not only grateful for their jobs, but they genuinely love what they do. “I’m proud to be a part of the organization,” says Ellis. “I keep learning new things and I hope to eventually buy my own home with the help of SMNC.” While all four men live in the neighborhood, Bruce lives in a house owned by SMNC. Upon moving into the rear apartment, Bruce’s first job with BHC was to repair and renovate the front apartment that had been damaged by fire.

For the staff of BHC it is about more than the job; it is apparent that strengthening the neighborhood is at the top of their minds and they have witnessed the SMNC mission in action. Bruce and Delroy agree that the improvements in the neighbor-hood have brought people together to work to improve their properties and take care of community spaces. “It’s great to see how our work has helped inspire residents to do things like repaint their homes and build gardens. It’s making a differ-ence, we are making a difference,” says Devon.

Brighton Home Corp. crew working on a house

BHC Board of Directors

Stephen Markley, Chairman of the BoardNancy McCoy, President

Matthew McArdle, DirectorDavid Michel, DirectorGary Thurston, Director

Tracy Whittenburg, DirectorSteven Coker, Director

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Brighton Home Corp Workers :Ellis Barner, Delroy Young, Devon Watson and Bruce Gayle

MAIN STREET PROJECT & MAINTENENCE UPDATE

South Salina Street Main Street Project

The South Salina Street Main Street Project started in 2009 with a $500,000 grant for the New York State Housing and Community Renewal agency. In 2011 National Grid added a $50,000 grant of much needed capital to the project. The

City of Syracuse has also been very supportive with federal HOME funds, loans from the Syracuse Economic Development Corporation (SEDCO) for the required matching funds and construction loan guarantees.

The project consists of renovating six mixed-use buildings on S. Salina St between Colvin St. and Lafayette Ave. Five of the buildings are complete and the sixth is nearing completion. This project has had a dramatic effect on S. Salina St., especially the block between Brighton Ave and Lafayette Ave. Before we started three of the seven buildings were boarded-up creating an enormous eye sore. Their renovation has added new life and vitality to the block.

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Amatullah Yamini, president of New Africa of Syracuse, Inc., is the owner of 2842-46 S. Salina St the final building being renovated in the S. Salina St. Main Street Project.

2842-46 S. Salina St. before construction started

2842-46 S. Salina St. seventy-five percent complete

Maintenence Update

When it comes to the maintenance of SMNC’s rental units we have two goals: First, we try to do as much maintenance as possible by using our own employees

rather than outsourcing; this includes heavy capital improvements such as roof replace-ment, porch renovation and re-sheetrocking entire apartments. The main exceptions to this are: licensed trades, such as plumbing, electrical, and heating where we do not have the necessary licenses. Other jobs that are hired out include lawn care and snow plow-ing, as we simply do not have enough staff or equipment to do it efficiently.

The second goal is to hire as many maintenance staff as possible from the neighbor-hood. Hiring from the neighborhood often requires that SMNC provide extra training. Our maintenance staff are routinely sent to BOCES night classes and there is a great deal of “on the job” training. We feel that it is important to recognize and incorporate the talents of the neighborhood if we are to make the neighborhood a better place to live.

This year we took another important step. Every member of our maintenance staff took and passed, the Lead Paint Renova-tor’s classes mandated by the Environmental Protection Agency, and are now certified to work on buildings with lead paint. SMNC and our subsidiary corporation, the Brighton Home Corp. also received a corporate certification as a lead paint renovator.

In addition to the lead paint certification, SMNC’s Maintenance Forman Dave Bass has been certified to handle the haz-ardous chemicals involved in extermination. This certification adds value to our staff and organization and will allow us to reduce expenses and serve the needs of our tenants better and more quickly.

Maintenence staff member Cassandra, readies a residence for a new tenant.

PROGRESS

Collaboration with the Police Department improves neighborhood safety

SMNC’s apartments at 118-24 W. Castle Street posed a special problem. Located in an area where

illegal drug sales are rampant, the buildings are difficult to rent and maintain for SMNC and are a potential safety problem for the tenants. The Syracuse Police Department has been very helpful in combating this problem.

We’d like to thank Southside Community Policing Officers, Joe Evans and Kevin Corcoran, for their efforts in curtailing the problems. Their attendance at tenant meetings, increased neighborhood patrols and arrests, have made a significant contribution to the increased safety in and around the apartment buildings on the 100 block of W. Castle St. THANK YOU!

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460 Midland Ave.

This property was renovated by the Brighton Home Corp crew. It is part of the Midland-Lincoln-Bellevue rehab project funded by Onondaga County and the New York State HOME Program. The kitchen cabinets (shown below) were

fabricated by Eustacius Donai in SMNC’s workshop. In August 2012 Mary Cannady, a first-time homebuyer, and her family moved into the home.

Mary Cannady and Eustacius Donai

Before After Homeownership realized!

Southside Community Policing Officers, Joe Evans and Kevin Corcoran in front of 118 W. Castle St.

RECOGNITION8

Starting three years ago, Winston Stewart, the super at 451-57 Midland Ave., began working on

his own with a small flower garden on the side of the building. The flowers were so appealing that SMNC asked him to do gardens across the front of both buildings. The flowers are a wonderful addition and add some beauty to what might otherwise be mundane buildings.

His efforts have inspired the tenants at two other SMNC buildings who have requested similar flower gardens be planted at their properties.

Thank you Winston!

THANK YOU!

Thank you, to all those who supported SMNC during the last year.

City of Syracuse

The City has supported SMNC since it was founded in 1972. Again, this past year, the City’s Department of Neighborhood and Business Development was SMNC’s largest contributor, providing $372,267. These funds permitted SMNC to keep its 101 rental properties in top condition.

In 2009 the City designated SMNC as the coordinator for the housing portion of the county-funded, neighborhood improvement work around the sewage treatment facility on Midland Avenue. Since then, SMNC was able to facilitate nearly $900,000 in improvements to owner-occupied homes in the area. The organization worked closely with Syracuse United Neighbors and Jubilee Homes of Syracuse on this project.

Special thanks to Mayor Stephanie Miner, Commissioner Paul Driscoll, and the Common Council for their assistance - without them, SMNC’s work would not be possible.

NeighborWorks America (NWA)

SMNC is a NeighborWorks America chartered member. NWA is a national corporation funded by Congress to create opportunites to live in affordable housing. SMNC receives support annually from NWA for both operations and capital projects.

Over the last year, SMNC was awarded a grant to install solar panels on its largest apartment building. These panels will lower operating costs, allowing SMNC to continue renting the apart-ments at an affordable rate. Since joining the NeighborhoodWorks network in 1988, SMNC has received $1.584 million.

Thanks, to NWA Northeast District Director, Deborah Boatright; and Management Consultants, Kate Adams and Judith Kepner Rose for their financial support, encouragement and sound advice.

New York State Division of Housing and Community Renewal (HCR)

HCR operates the Neighborhood Preservation Program (NPP), a federally funded HOME program as well as the NYS Main Street program. SMNC has been part of the NPP since 1983 and received $67,496 used to cover operating costs. This program makes it possible to partici-pate in other state programs that do not have operating costs attached to them.

In 2008, SMNC was approved for $600,000 in HOME funds that are being used to purchase and rehabilitate dilapidated homes that are sold to owner occupants. In 2009, $500,000 dollars in Main Street funding was received and is being used to help with renovations of a mixed-use property on South Salina Street.

Thanks to Commissioner/CEO Darryl C. Towns and Regional Director Dan Buyer and his staff for their support. Special thanks to Senator John DeFrancisco for his support of these essential programs during the State budget process this year.

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According to internal statements and preliminary outside auditor reports, SMNC’s twelve months ending April 30, 2012 were fiscally sound and encouraging. The healthy opera-

tions during the FYE 04/30/12 as well as in prior years is shown on the April 30, 2012 balance sheet where assets exceed liabilities by approximately $3,000,000. When mortgages for which no payments are due and mortgages that will be forgiven in the coming years are excluded from the balance sheet’s liabilities, SMNC’s net worth increases to a robust $4,000,000.

As alluded to above, SMNC’s audited financial statements have not been finalized; however, a favorable and unqualified opinion regarding SMNC’s reported income, assets, and liabilities is expected soon. Also expected soon is a favorable report on SMNC’s compliance with U.S. Treasury and HUD Department regulations.

• FYE 04/30/2012 highlights1. Thanks to SMNC’s professional management team and its maintenance crew, rental revenue increased once again. This year, rent receipts exceeded $1,250,000.2. In addition to rent receipts, SMNC received grants from the Housing and Urban Development Department via the City of Syracuse, NeighborWorks America, and the Neighborhood Preservation Program. The grants totaled about $875,000, all of which was used to either pay rental property expenses in excess of rental receipts or to hire workers to repair and improve properties.3. On average, SMNC’s Accounts Payable balance was paid in full every thirty days, which is a primary indicator of healthy company operations.4. All mortgages are current as of 04/30/2012; moreover, a mortgage was paid in full during the FYE 04/30/12 which has increased our monthly cash flow by $2,000.5. The Midland-Lincoln-Bellevue new construction and house rehabilitation project is mostly complete. Although it did not significantly impact SMNC’s financial position (SMNC was administrator of the project with no ownership interest), the project was budgeted and managed well and improved in South Side housing stock.6. In November 2011, Property Manager, Dorothy Adams, discovered that an employee had been falsifying business re cords and also embezzling cash. In light of this, Finance Director, Tracy Gossiaux, determined that approximately $80,000 had been embezzled by the employee over two and a half years, from mid-2009 to late-2011. As sad and disconcerting as this revelation was to SMNC’s staff and Board of Directors, it has served to improve the company. SMNC has implemented a separation of duties to prevent future embezzlement and is now more alert to potential financial dishonesty. Additionally, the employee is currently serving a three to six year prison sentence and all but $2,500 of the stolen funds were reimbursed in May 2012 by Travelers Insurance Company.

• FYE 04/20/2013 highlights1. A balanced budget is projected.2. Rent was increased modestly in September 2012 for properties not subject to limitations. The increased revenue of $1,500 per month will be deposited into a capital reserve account and used to improve properties in the future.3. Will internally create a report that will allow the Executive Director and Board of Directors to formally look at the cash flow of each property in the upcoming year on a quarterly or more frequent basis. 4. Bonuses were paid to SMNC’s 14 employees in May 2012. Bonuses were paid in lieu of raises due to projected Community Development Block Grant and Neighborhood Preservation Program Grant cuts.5. The Neighborhood Preservation Program grant ($55,000 in FYE 04/3012) was originally cut from state budget, then it was restored to its previous year amount plus $10,000.

• FYE 04/30/2014 highlights1. Community Development Block Grants are projected to decrease to $307,000 (from $360,000 in FYE 04/30/12 and FYE 04/30/13).2. To be able to operate capably and effectively with this reduced revenue source, SMNC plans to increase the occupancy percentage of our current rental units and possibly acquire additional cash-generating properties.

TREASURER’S REPORT10

TreasurerJack Salisbury, CPA

FINANCIALS11

AssEts 2012 2011Current Assets Cash and cah equivalents 137,294 441,992 Rent receivable, net of allowance 31,014 25,288 Grants receivable 214,454 117,795 Mortgage receivable, current position 0 4,486 Construction in progress 256,420 166,934 Other current assets 0 911 total Current Assets 639,182 758,006

Other Assets Tenant security deposits receivable 2,453 11,878 Security deposits held in trust 61,886 65,814 Escrow cash 33,942 37,275 Debt reserve cash 53,551 65,275 total Other Assets 151,832 180,242

Fixed Assets Land 704,098 706,716 Buildings and improvements 14,684,612 14,235,139 Equipment 334,878 329,758 15,723,588 15,271,613 Accumulated depreciation (10,614,690) (10,028,655) Net fixed assets 5,108,898 5,242,958 total Assets 5,899,912 6,181,206

liABilitiEs AND NEt AssEts

Current liabilities Current portion of long-term debt 83,368 96,476 Line of credit 221,426 207,350 Trade accounts payable 187,883 181,897 Deposits 3,350 3,350 Deferred revenue 283 31,559 Accrued compensated abscences 39,801 30,898 Accrued payroll liabilities 18,466 12,153 total Current liabilities 554,577 563,683

Tenant Security Deposits 87,456 97,307long term Debt, Net of Current Portion 2,169,642 2,256,207 total liabilities 2,811,675 2,917,197

Net Assets Unrestricted net assets, as restated 2,090,957 2,316,729 Temporarily restricted assets 0 0 Permanently restricted net assets, as restated 997,280 947,280 total Net Assets 3,088,237 3,264,009 total liabilities and Net Assets 5,899,912 6,181,206

Excerpt from preliminary draft audited financial statements

sYRACUsE MODEl NEighBORhOOD CORPORAtiONStatement of Financial Position

April 30, 2012, with Comparative Financial Information for April 30, 2011

SMNCSYRACUSE MODEL NEIGHBORHOOD CORPORATION

Phone: 315.475.8437 • Fax: 315.471.12151721 South Salina Street • Syracuse, NY 13205

SyracuseMNC.org

SMNC is funded by the City of Syracuse Department of Neighborhood and Business Development and the New York State Division of Housing & Community Renewal