As the excerpts here illustrate, rental housing owner Kevin Zurschmiede voted both ways while wearing different hats, putting him into position to tie King Larry's all-time flip-flop record by abstaining the next time it comes up ... and the developer did not fail to notice it. The administration took no public position until after the state declined credits. Councilman Caesar, who has contributed no known plan for assisting downtown revitalization beyond opposing two-way streets, outsourcing Bicentennial projects to out of state mercenaries and enabling condos-for-the-wealthy-some-time-way-down-the-road, was able to blithely rationalize his contempt for the less well off by waving a mimeograph of the tax code.
Fiction is dead and buried in New Albany, because everyday life is so consistently entertaining ... and so enduringly futile in a political sense. Do any of these people have a better idea for how the Reisz Building might realistically be used any time soon? Is it that we just couldn't run the risk of poorer old people living that close to Mr. Bobo's champagne-sipping penthouse dwellers? Doesn't Sterling actually have the money to do what they propose, and some semblance of a track record that might hint at an ability to succeed in doing it? If the answer to the last two questions is yes, shouldn't we give them the parking garage, because that way, at least something might get built?
Legacy at Riverside not dead yet in New Albany; Mayor Gahan disappointed that low-income tax credits weren’t awarded for developments, by Braden Lammers (Hanson Compendium of Pop Ups and Roll Overs)
Councilman Kevin Zurschmiede voted in favor of that resolution while on the redevelopment commission, but sponsored the measure opposing the developments for the council.
“We did have support unanimously [from the redevelopment commission], and then to find out after the fact in the new year that we might not have support I guess we were a little confused and not sure what was going on,” (John VanMeeter director of development for The Sterling Group) said.
(Mayor Jeff Gahan) said the Legacy at Riverside “would have given a dilapidated city block $12 million worth of development. The seniors that would reside there could have visited our downtown restaurants and shops, and contributed to the local economy in a big way.”
The administration estimated the property tax base would have risen from about $10,000 to $40,000 annually on the lot due to the Legacy at Riverside project. However, Councilman Bob Caesar estimated the city would lose millions of dollars in property taxes over the life of the developments if they received credits when he voted in favor of the opposition resolution.
Regarding the proposed residents of the Reisz Furniture building - is the proposed target tenant group low-income?
ReplyDeleteYes, I believe the tenant pool would be made up of 55+ years old and 60% of local median income (sic).
ReplyDeleteCouncil members wanted to be sure that this would be the case in perpetuity, which Sterling said was its intent, but after 15 years, tenants wouldn't necessarily be such (if I recall correctly).
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ReplyDeleteI see very few stores and restaurants downtown that would be of interest to "seniors" who have a monthly income of $ 918.00, which is an annual income of $ 11,019 per year (60% of $ 18,365 area median income).
ReplyDeleteWe have no way for those folks to access groceries. There is not a convenience store within walking distance of the Reisz building, unless you count the Shell gas station on State Street.
According to a study of Seattle, Washington low-income, elderly residents of subsidized housing:
"This study reveals that food insecurity is extremely high among seniors and persons with disabilities residing in Seattle’s government subsidized housing complexes.
Food insecurity is almost five times more prevalent in the sampled population than the general population in the United States.
In theory, the United States’ social programs should be acting as a safety net, preventing these populations from experiencing hunger and nutritional deprivation. However, there are many barriers that prevent this demographic from acquiring an adequate amount of nutritious food for an active and healthy lifestyle.
The current emergency food system has many shortcomings that prevent seniors and persons with disabilities from accessing nutritious food. Not only do these people have a hard time knowing where to turn for assistance, many have physical and mental health conditions that prevent them from physically accessing those resources.
However, qualitative data from focus groups stated that accessing the resources for food is not the only problem. Many seniors and persons with disabilities experience difficulty standing for long periods of time to cook the food they receive from emergency food resources like food banks."
The romantic notion that the attractive, aging baby boomers you see in the Ensure liquid nutrition ads will flock to New Albany to rent a small apartment on Main Street is false when you weigh it against the reality - the target group earns 60% of the city's median income - about $ 30 per day.
How much is the projected monthy rent in these units? After paying rent, how much will they have left of their $ 900 monthly income?
These folks will not stroll about at night downtown seeking entertainment and diversion. These are folks living on assistance or an extremely fixed income.
The study can be found here:
http://www.solid-ground.org/AboutUs/Publications/Documents/FoodSecurityForSeniors-PersonsW-Disabilities.pdf
I don't think it a romantic notion that older folks, regardless of income, might want to enjoy the social atmosphere and opportunities downtown. Entertainment and diversion comes in a lot of forms, including an occasional meal or shopping trip. Better a stroll or other comparatively easy access than another night of television in seclusion.
ReplyDeleteWhile the lack of a good grocery is an issue for all of us, the farmers market and/or CSA is easily the best option for nutritious food, both downtown. With good design and planning, space at the residence could be utilized for public gatherings or events of different sorts as well, making it much easier for residents to participate. That location would also put them as close as they're going to get to senior-targeted YMCA and LifeSpan services at Scribner Place. The library is nearby as well.
In terms of access, is there a better location for senior housing than downtown?
You're overlooking my point - it's another "subsidized" rental scheme.
ReplyDeleteHow much are the projected rents? How much is left over for tenants after paying monthly rent if they must earn 60% of median income?
When I see a project pitched as a way to shower downtown businesses with new revenue, I wonder how much is hyperbole and how much is real?
Not overlooking your point, just suggesting it's not the most important one to be considered. The "showering of revenue" is a secondary concern.
ReplyDeleteWe have a need for senior housing that looks as if it will only increase. We have a well located property that has sat underutilized for a long time. We have an experienced, Indiana based company that at least seems to be trying to go about putting the two together in a reasonable way, at least much more so than River View-- which some of the same council folks have been happy to offer support and assistance, up to serious consideration of millions in local subsidy.
Beyond that, I'm pretty sure median AMI is calculated using household income for housing projects. The 2012 chart shows 60% of median AMI at $26,820 for a single person household in Floyd County (Louisville MSA), not $11K. Depending on apartment size, rents run about 30% of maximum allowable income.
We are talking apples and oranges here, Jeff.
ReplyDeleteI'm using city of New Albany single household income numbers. You're right about the Floyd County number. It is unclear what number the developers are targeting - city or county? They want to build in the city.
Floyd County household income number is actually greater than Jefferson County, Kentucky's number - but I don't think anyone would argue that Floyd County enjoys a larger, more vibrant economy than Jefferson County, Kentucky.
And please remember, the developer's target is apparently folks that earn 40% less than median income.
ReplyDeleteWe're not talking about apple and oranges. The developer has to use federally determined income and rent limits for the project to qualify for the HUD issued credits. For the city or county, those are the Louisville MSA numbers. There's no choice as to which to use.
ReplyDeleteWhen they mention their targets and percentages, they're talking about the Louisville MSA household income numbers.
I just checked the article in the Tribune that quotes Mr. Swank saying the target is "residents and their families (who) have to make between 30 and 60 percent of the Area Median Income, or AMI."
ReplyDeleteUsing your $ 44,700 AMI number, that means residents could qualify with an income as low as $ 13,400.
Using your rental fee estimate of 30% of maximum allowable income, the rent could be $ 8,000 per year.
You can't do a lot of strolling and enjoying downtown at night if you have just $ 14 a day to pay for everything else all year long. Your medical bills, your utilities, your groceries, your clothing - it adds up.
It seems to me the folks who will be doing well are the developers.
Why can't someone build in New Albany without relying on federal assistance for low income renters?
A person at the 30% AMI level would pay a maximum rent of $359 per month for a one bedroom. The developer has to specify income level targets and can only charge accordingly. Sometimes, there is a mix of specified income levels in a single development.
ReplyDeleteLikewise, a single person 55+ with an income of $26K per year ($2,166 per per month) would qualify for residency at the Legacy development under the 60% mark. Their rent for a one bedroom apartment would be limited to $718 or less. That leaves $1,454 per month for other expenditures.
That would be true regardless of where in the Louisville MSA the property was located.
What's much less clear is where Caesar is getting his "millions in lost local revenue" numbers. Some senior housing is done as a completely non-profit enterprise and avoid taxes that way. Others are developed differently and pay taxes, some of them the full 2% owed on property. St. Edward Court, for instance, is partially abated but still paid about $73K in property taxes for last last year.
As the developer pointed out, those making less than 30% AMI are generally covered by public housing. There is a gap in decent, affordable housing for those in the 30-60% range. Age limits would seem to dictate few if any children in the household but, for a family of 1-2, income could range between $13,410 and $30,660 per the 2012 standards applicable to the property.
The question you ask is dependent on numerous factors including education levels, transportation, housing regulation (or lack thereof), the comparatively massive public incentives provided greenfield developers, etc.
If you want more private, city development/redevelopment, make it easier and/or cheaper than outward-bound county development. As a lot of places, we do the opposite.
ReplyDeleteThere's a decades long understanding in place between developers and public officials that says if said developer wants to go out yonder and build whatever away from preexisting, already paid for resources, the public will pick up the investment slack in perpetuity-- more and expanded roads and streets, rural school expansions and busing increases, increased fire and police protection, etc. The additional taxes collected rarely actually cover those costs, eventually putting the public in the long-term hole.
An example: Ed Clere co-authored legislation that gives a developer a 100% property tax break for a few years if a new home they build doesn't sell. They miscalculate the market, we pay. Public risk, private reward. It's an incentive for foolishness.
Start making the developers financially accountable for some or all of those impacts and watch development inside the beltway increase. As of now, we scoff at city developers who, overall, tend to ask for less subsidy.
How will they afford it, w&la?
ReplyDeleteThey will afford it the exact same was residents of Saint Edwards Court have afforded it for the past ten years.
They're the exact same program with the exact same restrictions.
I dare someone on the council to say Saint Edwards Court has not been an asset to this community.
I can't think of anything more depressing than a debate about more low-income housing in New Albany.
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ReplyDeleteI don’t see it as a debate between “more or less” affordable housing. I see it as a debate as to what type of affordable housing the city has.
ReplyDeleteRight now, the city has many, many people at 30% and 60% AMI. The vast majority live in unsubsidized units. There are units that are never inspected, where the tenant is not evicted for drug offenses, and where the exteriors are not maintained.
With programs like LIHTC, the units are inspected regularly by HUD. Problem tenants are evicted and exteriors are well maintained.
LIHTC will not be popular with owners of the worst unsubsidized units. When given the option of something that, for the same money, is safer and cleaner, tenants will vote with their feet.
Satirist - I realize that I am but a lowly citizen, and I have not ascended to the heights of Councildom, so I know I dare not challenge you either.
ReplyDeleteI do, however, seek enlightenment.
Please tell me - what "asset" has Saint Edwards Court been to this community?
St. Ed adaptively reused a historic building to help help solve a community problem. It makes clean, safe, affordable housing available to those who may not otherwise have it in an area where its residents have walkable access to other community institutions, allowing them to more fully participate in civic life. It also contributes to the tax base.
ReplyDeleteWhat's the "community problem"? That New Albany cannot fill 50 units downtown in a renovated historic building at real market rates?
ReplyDeleteWhy can't someone renovate a building downtown and earn a market rental rate?
"What's the 'community problem'?"
ReplyDeleteThat people needed a decent, affordable place to live. It's a problem all over the world.
"Why can't someone renovate a building downtown and earn a market rental rate?"
They can. They have. As far as I know, there is only one rehab that's been aimed at lower income - St. Ed - but they have some units at market rate, too. All the other rehabs and a majority of apartments in town on the whole are at market rate, AFAIK.
What building would accommodate 50 units if rehabbed?
ReplyDeleteCan someone explain what the our only skyscraper, the soviet style building near the 64 off ramp downtown, was built for? What were the projects by the country club built for? What are the thousands of shot-gun shacks built for? And most of the other historic buildings in town?
ReplyDeleteNo one driving through NA gets the impression we are in need of more low-income housing.
They were built so the bourgeoisie could feel better about themselves.
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ReplyDeleteI disagree - Gina's questions are not about the "landed gentry" trying to feel better about themselves.
ReplyDeleteThis discussion is really about whether or not the City of New Albany has a plan to grow this city, it's businesses and tax base, or if it simply wants to grow in numbers by warehousing people through government assistance.
Are there jobs for the people being given below market rate housing?
The New Albany Housing Authority operates 1,083 housing units (approximately 17% of all rental housing in the City) in two high-rise buildings that serve the elderly and/or disabled tenants, and five apartment communities that serve mostly non-elderly.
1) Riverview Towers is an assisted living building aimed at the elderly, much like the one proposed in the Reisz building.
2) According to long-time residents, the "projects" off of Bono Road were built as temporary housing for returning veterans in WWII and were originally meant to be torn down, but were kept to provide low cost rental for area factory workers. As the factories closed, the workers lost their jobs and the cycle of assisted living started.
3) The "shot-gun shacks" are period architecture that has been allowed to deteriorate by a lack of code enforcement, even though they are often rented by absentee landlords.
Where's the plan to build the City through business and real income instead of federal dollars?
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ReplyDeleteSome of us, Bill, have been making market level redevelopment suggestions for years but the problem isn't the folks with limited incomes who often get scapegoated.
ReplyDeleteEven in this thread, I've put forward suggestions for more equitable development. Chances that those with the largest share of what most people recognize as capital will take them up? Slim. It might weaken their dominant position.
Even far too many of our self-styled do-gooders spend their time seeking advantage for themselves rather than pursuing actual, game-changing alternatives.
Is local government supposed to somehow magically develop plans when representatives are chosen from a populace who, for the most part, take little interest in such things? What's on sale at Wal-Mart today?
People with limited incomes, including those who work full time, get taken advantage of in this city everyday. But the conversation is rarely about that. It's more likely to be about why we have to live near them or how it effects our image. Start talking about real, on the ground changes to economic structures, though, and a lot of the very same people tend to shut up and/or get offended. And there's nothing more depressing than that.
ReplyDeleteYou want to see why things are the way they are? Go check out 1Si's legislative agenda. Nearly every piece of it is about taking power away from workers and giving it to upper level state officials and large businesses-- spend less on regular folks, spend more on those who already have a lot.
ReplyDeleteEducation reform is derived via corporate fiat as represented by the state chamber of commerce. Got too many unemployed? Cut their benefits. Health care access? No sir, that's socialism. We all know government spending is out of control unless it's aimed at incentives for big, often out-of-state companies.
The local reaction? Treat Ed Clere like a hero for dutifully following along like a blind dog.
That's reality. Deal with it or not.
I must have missed it - when did the Mayor, his staff and the City Council treat Ed Clere like a hero? Was there a parade?
ReplyDeleteI have helped developers market abandoned properties in Louisville, including moth-balled schools, turn them into market rate apartments and condominiums, and they earned real profit doing so.
The difference in what they have done and the assisted living model is that the market rate buildings have continued to grow in value, rise and fall with the market and have become important developments in their neighborhoods. The first building I helped market in 1979 - the units sold for $ 35,000 or so. Today, they sell for $ 250,000 and up, and the neighborhood has grown with them. And Crescent Hill was not as desirable when someone had the guts and the vision to move forward in the 1970s.
I don't think the assisted living buildings in New Albany will enjoy such a fate - I think they will be seen exactly for what they are, buildings with living spaces that are for rent, not purchase. They will not contribute to growing the local economy.
I agree folks need a place to live and deserve the same, but when you lived in an apartment, did you feel as kindly toward it as you now feel toward the home in which you live?
Regarding your comment that local politicians come from the local populace that "doesn't care" - aren't you really giving them a pass?
Doesn't earning elected office obligate one to effort? Do you really mean we should just give up on holding our elected officials accountable because they "come from us"?.
No, Bill, I was referring to holding ourselves accountable. Like it or not, our government is a reflection of us even we elect Clere to carry out chamber of commerce orders.
ReplyDeleteI persist in thinking that our council's thought process has not embraced anything mentioned here thus far.
ReplyDeleteAs we await Bob Caesar having a better idea, whether about this or anything else (perhaps he can ask Mr. Crutchfield to help him figure it out), I'm going to have a locally brewed beer.
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ReplyDeleteWhat would this community look like if all those who were specifically supposed to consider and engage the public on such issues actually did?
ReplyDeleteWhat if DNA took the notion of economic restructuring, one of their standing committees, seriously?
What if preservationists regularly addressed land use and transportation issues, explaining how they impact our cultural landscape and heritage?
What if 1Si sought out and shared best practices from around the country instead of catering to the political whims of large donors?
What if local politicians actually used newspaper column inches to objectively hash out the pros and cons of various decisions?
What if there was no excuse for council members to feign and/or demonstrate the type of ignorance some of them showed during this housing issue?
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ReplyDeleteIf the only thing the city does to address the “low income housing problem” is kill Legacy at Riverside, all that happens is New Albany maintains its status quo. Killing it does not address problem rentals and does not address anything at the Housing Authority. Killing Legacy at Riverside solves no problem the city currently has.
ReplyDeleteI’m aware of a little old lady who lives in SEJ. She owns her own home, one likely worth no more than $10K. Last I heard, her home had no functioning furnace and hadn’t one for some time. If the code inspector knew she had no heat, by law he should tell her to move. Move where? New Albany is the only home she has ever known. Social security is her only income. Market rate rent is not an option for her.
If the city is going to get more serious about code enforcement, it needs to either (i) be prepared to kick this little old lady onto the sidewalk or (ii) have another option for her. Something like Legacy at Riverside would be another option.
I can understand the concern if Legacy at Riverside is viewed only as an addition to current low income housing stock. However, if approval is coupled with stricter enforcement of the worst low income housing, Legacy at Riverside would be part of a solution. If stricter enforcement closes the worst housing units, Legacy at Riverside would not add to the low income housing stock, but instead replace the worse low income units with much cleaner and safer units.
Either way, voters want something done about the existing problems but just killing the project does nothing to address them.
Your going to have to build many, many "Legacy at Riverside" buildings, Dan.
ReplyDeleteI'm quite certain there are more than 72 houses in the Uptown/Midtown area that meet your criteria.
Is it the city's (or any city's) responsibility to provide low income housing for any and all residents that need a furnace, a working bathroom or plumbing?
Is this just a salve for a collective guilty conscience having let the city fall apart?
The city can't even compel a business on a major thoroughfare repair it's flapping, decaying siding, seen by all who visit our city - after many years.
I ask again - why doesn't the city create a real plan to attract business to New Albany instead of "growing" through creating more housing complexes?
Is it the city's (or any city's) responsibility to provide low income housing for any and all residents that need a furnace, a working bathroom or plumbing?
ReplyDeleteThe city is not building Legacy at Riverside. A private developer is.
I'm quite certain there are more than 72 houses in the Uptown/Midtown area that meet your criteria.
Agreed. And inaction does nothing to address that issue.
The city can't even compel a business on a major thoroughfare repair it's flapping, decaying siding, seen by all who visit our city - after many years.
This sounds like an argument for more code enforcement. I agree.
I ask again - why doesn't the city create a real plan to attract business to New Alba...
A “real plan” sounds great. I’m all ears. But just attracting new business does not address current housing problems.
@ w&la
ReplyDeleteYes or no?
1. Do you believe Legacy at Riverside units will be cleaner and safer than the worst existing housing units in New Albany?
2. Do you believe it is impossible for the city to shrink the number of the worse existing housing units?
My point is at 70 or so units, you're already full. Building an ever increasing number of assisted living units does nothing to address the real issues.
ReplyDeleteIn your scenario, your little lady moves to a LIHTC unit.
What happens to her house? For about $ 700, a "developer" pops in a small furnace and voila - a new rent house!
Every person you move out of a house that needs code violating repair becomes another slum unit.
All you've done is add one more person living in a substandard house and another person in the now repaired rental unit.
What about a program that encourages people like you and me to buy the house from the lady, fix up her house, let her live in dignity (with heat) while the new landlord makes a decent, fair rent from the newly renting little lady?
You won't do it because you don't trust the city to get better and make your investment grow.
The other factor in all of this is the LIHTC program allows C corporation developers a one to one tax credit for every dollar invested, skewing the interest toward LIHTC instead of market rate investment.
It's not a level playing field. LIHTC funds may well soon dry up again, and that's why these developers are keen to move now, and move fast.
I'll simply raise again that the issues here, while fodder for local government, aren't at all restricted to it. To adequately address real estate market conditions and many others, we need buy in from county and state officials and those who spend time and money lobbying them (or at least sufficient organization and clout to sufficiently combat them).
ReplyDeleteIt continually interests me that subsidized housing for low income people in the city is an "issue" but the substantially larger subsidies that systemically devalue the very properties in question go unaddressed, even by those complaining about low income housing development.
As long as that's the case, it becomes a matter of at least tacitly approving subsidy for the comparatively wealthy but not the poor. That's an even bigger tilting of the playing field oft ignored. If a level playing field is the desire, those subsidies must be addressed with as much or more vigor than low income housing.
A case in point: At the city level, the two council members who pushed this housing subsidy issue the hardest, Kevin Z. and Bob C., are the same two who fought a resolution against bridge tolls, which stands to cost city dwellers (including low income people) a lot of money to subsidize continued exurban, greenfield development.
ReplyDeleteIn terms of fairness and leveling, that's more than slightly hypocritical. In terms of upping the value of urban properties, it's also bad strategy.
To expand on Jeff’s point, code violators have a cost. One obvious code violation will hurt property values on a whole block. This hurts neighbors, but also hurts tax assessments and ultimately property tax revenues. Purposely ignoring code violations subsidizes violators at the expense of everyone else.
ReplyDeleteNo one in New Albany has a hand in drafting Section 42. We could argue all day about the history and market effects of LIHTC. That’s an important debate on a national level, but not one particularly relevant to options available to city government today.
The ultimate goals of city policy should be clean, safe neighborhoods, at a reasonable cost. Choosing which real estate interests win or lose under the federal tax code, or whether markets are economically efficient, is outside of the power of the city and should not be a goal more important than results on the ground.
As to your overarching point that more code enforcement is needed, I agree wholeheartedly. But that point, so far, as not been a part of the public debate. Nothing that addresses existing housing problems has been part of the public debate.
See - we're drawing together in agreement.
ReplyDeleteMy concern (and fear) is that every assisted living complex built allows city officials to wash their hands and even brag about "progress" when the underlying issues aren't addressed.
How many homes have been sold in the SEJ NSP project? I know of one (at least the real estate sign was removed).
The city will end up renting those houses, or sell them to "friends" who will rent them.
I forget the exact number, but last I heard (maybe one month ago) 7 or 8 had either closed or were under contract. Keep in mind that construction continues and most have not yet been placed on the market.
ReplyDeleteDan's right. NSP is doing pretty well under current market conditions. But, it's another situation that could've been better handled overall were it not for state level intervention that placed additional restrictions on the program over and above federal guidelines for the federal funding.
ReplyDeleteJust hypothetically - say we have 30% of our total housing stock as "substandard". I don't know the actual number, but I wouldn't be surprised if it was 50% substandard. Add the ever increasing number of sheet metal industrial buildings to the mix. Destroy the urban canopy and poison all the streams.
ReplyDeleteNone of this happened accidentally. City government cannibalized itself and the city over many generations. And it was done because people made money picking the city apart and selling off it's former assets. How do we get real people with real money to return and recapitalize the town? I've done my part, but my slumlord neighbor undermines me so it's a zero sum game. Who are the people and businesses we want here? All I hear is more help for the rich and poor. I'm looking for a nice middle class city, isn't everyone.
There are many reasons for urban decay and none of them are unique to New Albany. This story is not an original. Having lived here for a decade now, I’ve actually grown weary of hearing the same tune over and over about how our once great city has gone to hell. Trust me, it was never a garden paradise. It was always an economically diverse city. It always will be.
ReplyDeletePositive changes are happening here. The place has become interesting. There are plenty of crappy little river towns in the area that would love to have what we have. The place is evolving and developing its own identity. This is what, over time, will drive the market and make it healthy. Not one project or a dozen projects will do that. People just have to want to make this their home.
Regarding LIHTC projects, if someone is patting themselves on the back for having helped “kill” the projects, they are idiots. The only thing they’ve contributed to doing is assuring that safe, quality housing has been denied to some residents in the area that probably really needed it.