09/24/2012 Council Packet - Laserfiche WebLink

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2. One -story townhomes One -story townhomes would not make a lot of sense given we need to build them with 2+ bedrooms. 3. Apartment building versus townhome The building on our web -site is Stone Creek apartments in Plymouth, MN. It would be possible to do apartments, but because we are proposing a family project we think townhomes are more desirable to families with children. A townhome project is more likely to be successful. 4. Market Study We have not ordered a market study from a third party market study analyst. We have conducted our own internal rent study. If that would be of interest to the council we would be happy to forward it along. 5. Section 8 housing This will not be a Section 8 project. It will be a Section 42 project. The Section 8 program directly subsidizes the tenant's rent. Under that program, the tenant's rent responsibility is capped at 30% of their income. If that amount is insufficient to cover the total rent, HUD covers the remainder. Under the Section 42 program, tenant rent is not directly subsidized. Instead the tenant is responsible for 100% of their rent. In addition, the developer promises to cap rents at program limits and is only allowed to rent units to tenants that income qualify. In exchange, tax credits are allocated to the project. 6. EDAC Recommendation The following is from the September 6, 2012 draft minutes of EDAC. Comments from EDAC members regarding the use of Legacy property for affordable rental townhomes included the following: • The City hears from many developers that there is a shift to rental • With quality standards of construction, what is affordable and what isn't is indistinguishable • It's geared toward families. Young families who move into a community tend to stay in that community • The City needs rooftops to attract more commercial • It's not perfect, but it fits a lot of the categories of what the City is looking for Ms. Schwartz moved that EDAC recommend to the city council that the concept of affordable /rental townhomes warrants further exploration considering the following circumstances: • The developer's positive reputation • The plan is not dissimilar from what was originally planned on the site • Current market conditions are not favorable for most for sale townhome developers • The financial situation of the Legacy development EDAC recognizes there needs to be further exploration of financial implications to the city. Mr. Combs seconded the motion. Motion passed unanimously.