TRAVERSE CITY — City commissioners chilled a proposed low-income housing project because they said they lacked hard information to proceed with a sought-after tax incentive, but at least one promised to take a more proactive stance to attract affordable housing to the city.
Commissioners said they need more time and information to review a request to waive approximately $330,000 in property taxes for a proposed affordable workforce housing project. They expressed several concerns about the proposed development on a 15-acre parcel at 10597 East Traverse Highway, just west of Tom’s West Bay.
“This raises a lot of flags for me,” said Commissioner Gary Howe. “It’s on the city’s edge and ... 100 percent affordable housing is a red flag for me. When you start putting it in clusters by itself is when you start running into problems.”
The project developers, Ohio-based The Woda Group Inc., attempted to meet a Feb. 14 application deadline from the Michigan State Housing Development Authority that would allow the group to qualify for tax credits. The program requires developers to apply for a payment in lieu of property taxes equal to 10 percent of rents or less.
P. Craig Patterson, vice president of development for the Woda Group, said they normally take several meetings to work through a project with city officials, and he understands why commissioners tabled the matter on Monday. He expects the developers will return to the city in an effort to meet the next MSHDA deadline in August.
The Woda Group proposed to construct 102 apartments with a mix of one to three bedrooms in 17 buildings. Renters cannot earn more than 60 percent of the household median income for Leelanau County, or about $29,000 for a single person and $41,000 for a family of four.
Income level and other factors such as utility costs eventually will determine the rents, Patterson said. But gross rents are expected to range from a low of $380 on one bedroom apartment to a high of $875 for a three-bedroom apartment. That compares to fair-market rents of $781 for one bedroom to $1,083 for a three-bedroom apartment in Leelanau County.
Commissioner Jeanine Easterday expressed regret at the commission’s lack of action.
“I feel like we are losing an opportunity to do something,” Easterday said. “We give lip service to affordable housing and then when it comes right down to it we don’t follow through.”
But Easterday said she also has a responsibility to her constituents to make sure projects are done correctly and the Woda development featured several last-minute changes, including a reduction from 100 percent low income to 80 percent.
Mayor Michael Estes said Tuesday the request showed him the city needs to begin identifying the best locations for subsidized housing in the city. He’s asked the city planning commission to begin identifying locations that would be best suited for affordable housing projects.
“Then you have to develop a philosophy that you are willing to do some financial incentives in those areas,” Estes said. “We do it all the time for industrial property and commercial development, we just haven’t done it for affordable housing.”
Estes said new efforts won’t rule out the Woda Group project.
“We’re not going to reject a project just because they have a different idea about where things should go,” Estes said.