WILLMAR — The city of Willmar will be implementing a new tool to provide affordable housing if the proposed tax increment financing agreement with Trident Development for the Waterview Senior Housing development is approved by the Willmar City Council. The Willmar Planning Commission on July 3 passed a motion to recommend that the council approve the tax increment financing agreement between the city and Trident for the development, which will be located at 2001 Ninth St. S.
E. A public hearing will take place during the council meeting on Monday, July 15, for the agreement. The meeting takes place at 6:30 p.
m. in the boardroom of the Kandiyohi County Health and Human Services building, 2200 23rd St. N.
E. “I want to extend my gratitude, thank you to the Planning Commission for their support and vote on this matter. It's very critical for us,” said Roger Fink, senior vice president of Trident Development.
Willmar Planning and Development Director Christopher Corbett explained to the Planning Commission that a state statute allows the city to collect a portion of the additional property tax revenue generated by the new development to be used for other housing initiatives throughout the city. Tax increment financing is a tool that communities use to capture a portion of the property taxes above the current value that results from a new development or redevelopment project. That portion of the taxes may be used toward development costs.
In this case, the city would retain 20% of the additional property tax revenue created by the new development to create the new housing initiative, and Trident Development would be reimbursed 80% annually to address an estimated $2.7 million funding gap for the $22.3 million senior housing project.
The term of the agreement is 26 years or $2.7 million, whichever comes first. Throughout the life of the tax increment financing agreement, at least 20% of the housing units in the 75-unit Waterview Senior Housing development must be reserved for people whose annual income is no more than 50% of the area median income.
Using the new tool, the city will generate approximately $760,000, roughly $30,000 per year, for the housing initiative fund, according to Corbett. Details of the program and the application process are yet to be determined, but it can assist in funding the acquisition of housing, construction of housing, site improvements, or any expenses traditionally financed with housing tax increment dollars. “There's a fair amount of flexibility for housing projects and the pooling concept .
.. as long as it's for projects that basically meet the definition of what you would finance with the housing tax increment district,” Mikaela Huot of Baker Tilly explained to the Planning Commission.
“The intent of it is to be able to maximize the use of the tax increment revenues that are generated by this project, to first and foremost finance this project and allow it to proceed as proposed," Huot continued, "and then, secondly, to generate an additional pool of funds that the city can use to leverage other qualifying housing projects within the city and project area.” Rental properties that would qualify for assistance through the new housing initiative would be those where 20% of the residents have an annual income of no more than 50% of the area median income or where 40% of the residents have an annual income of no more than 60% of the area median income, according to Huot. Homeowners who have a family of less than four would qualify with an annual income that is 100% of the area median income, and families of four or more would qualify with an annual income of 115% of the area median income, according to Huot.
Conditional use permit The Planning Commission also heard a briefing for the conditional use permit for the Waterview Senior Housing development, which will include 14 memory care units and 61 assisted living units. Fink explained that, in addition to the housing, Lifespark will provide health and housekeeping services, as well as food services for tenants and their guests. The development will also have a beauty salon.
“We really have three different business operations happening within the confines of the building,” Fink said. “I'm trusting that the conditional use permit and the underlying zoning will cover all of those intended uses within the property.” Willmar City Planner Chris Frank said he would verify that and have all of that information prepared for the public hearing.
Construction of the development is expected to begin in late 2024 and be completed by Dec. 31, 2026..
