After a lengthy period of discussion, the Atlantic City Council, Wednesday, passed a Resolution of Support for the development of an affordable housing project on the City’s south side. The City’s Finance Committee has discussed the matter twice, and recommended the Council approve the resolution, which does NOT commit the City to any financial package or incentives, but will serve to lower the developers’ operating costs, by allowing them to qualify for Low Income Housing Tax Credit through the Iowa Finance Authority (IFA). Councilpersons Kathy Somers and Shaun Shouse are the Council’s liasons on the Finance Committee. Somers said last night, the developer, Cohen-Esrey, has lowered the construction costs of its planned single-family homes in the area of 22nd and Olive Streets, to $100,000, including the land. That means the homes would cost approximately $88,500, wih an assessed value of $85,000.

The original proposal called for the City to offer, in the developers’ application to the IFA, a level of financial support of up to $160,000, but the Council voted to have the amount of $65,692 written into its resolution, which equates to about $4,105 per unit. The resolution also calls for a 10-year, $65,000  Tax Increment Financing proposal, instead a 17-year Tax Rebate, as originally proposed. A number of hoops remain before the City actually commits any funds for the project, including: public hearings, a minimum assessment agreement, and completion of a development agreement.

Cohen-Esrey says if their IFA application is approved, they will move forward with plans to build 16, 3-bedroom, 12-hundred square foot, single-family homes. Somers says studies have shown Atlantic could use some more Low Income Housing.  Councilmen Dana Halder and Steve Livengood expressed concern about the quality of the homes…their energy efficiency and the types of studs used, for example…especially in light of how much they will sell for. Many questions still remain about the details of the construction elements, but one thing is known: the homes will be built on concrete slabs, and will not have basements, because of water drainage issues in the area.

Somers said the idea behind the project is that the homes will be rental properties for 15-years, but at the end of the 15-years, the homes will be sold. The renters will contribute $50 each month toward a maintenance fund/downpayment on home ownership. In 15-years, the renter could buy the home for about $65,000.

Patrons of the Oakland-Riverside School District will be heading to the polls next Tuesday, to vote on a $13.3-million bond issue. Jim Sutton, Superintendent at Oakland-Riverside said if approved, funds raised by the sale of bonds, would be used for a project that’s very similar to one proposed last Spring, which calls for the combining of their educational centers located in Oakland, Carson and Macedonia, into one building. Sutton said getting to this point has been a multi-year process. He says the Riverside School Board opted for another bond issue attempt because 53 percent of the voters supported the project last time around. According to Sutton, there would be a cost savings of close to $250,000 per year, by combining the educational centers. Those savings he says, could be used to pay for additional teachers. 

While the total cost of the project is around $21.6-million, Sutton says there will be $2.5-million in savings. He says there is also a little under $6-million which will be borrowed from the remaining sales tax that’s available. The district’s taxpayers will likely see an increase of $2.70 per thousand dollars taxable valuation, which will generate the $13.3-million dollars to pay for the project. Sutton says if you have a $100,000 home, it will cost about $11 more per month in taxes, or about $134 per year, to pay for the bonds, or about $2.25 more per acre of agricultural land. He says there are only six school districts across the State of Iowa with a lower tax asking rate than the Oakland-Riverside District, which is currently at $10.19 per thousand dollars assessed valuation.

Sutton says with interest rates at historically low levels, now is the prime time to lock in the bids for any new construction, and because the builders are being very competitive. At a public meeting held January 23rd, it was pointed out that the district has the money now to build the project as proposed, but it will not be able to have that money if it continues to spend sales tax money to add new roofs and elevators to outdated buildings that are landlocked, and it will add extra costs to the district in various other ways.