Developers get pushback from Huntingburg residents on Fourth Street project

Tuesday night, about 70 curious and skeptical Huntingburg residents and business owners filled a meeting room at the Huntingburg YMI to hear details on a new workforce housing development being explored on Fourth Street.

Gary Ritz and Mike Mance of Paragus Development LLC as well as representatives from TRI-CAP — they are a partner in the project — gave an overview of the project before fielding questions and comments.

The two-phase project will create 40 apartments on the property at 511 E. Fourth Street currently known as the WTH Technology building across the street from Huntingburg City Hall.

The first phase consists of creating 19 efficiency apartments in the existing building which is actually two structures — a two-story structure combined with a four-story structure. These apartments would be single-bedroom efficiencies varying in size from 375 square feet to 450 square feet. Three in the second floor of the building fronting Fourth Street and four apartments on each level of the four-story building in the back. The first floor of the building on Fourth Street will have an office for the property manager and a community room.

The second phase would see the construction of a new three-story building on the blacktop lot south of the existing building. This building will have three two-bedroom apartments and 18 single-bedroom apartments.

In addition to the new building, a portion of the existing lot will be converted to 21 parking spaces.

Ritz gave the crowd a history of how Paragus came to be interested in Huntingburg.

The city and TRICAP worked together to create a request for proposals on creating housing on Fourth Street as the city indicated it needed to do in its strategic plan created in 2013. The need for entry-level workforce housing has been identified by local industry that is struggling to fill an average of 800 entry-level manufacturing positions in Dubois County. A study completed by Dubois Strong corroborated those needs expressed by the local industry.

According to the city, three developers approached them about the project but two requested the city purchase the property and make additional commitments that were not in the best interest of the city’s taxpayers. Paragus, which will have some requests for economic incentives like a tax abatement, did not request the city purchase the property or additional properties to bring them to the table.

Ritz said the need expressed by the city and TRI-CAP in addition to the housing studies completed helped them make their decision to invest in the community.

“We were very impressed with the information that we received from TRI-CAP and the city,” Ritz said. “In fact, in all the years we have been in this business, we have never seen the amount of data on a particular market and rental housing needs than what we received from TRI-CAP and the city.”

After studying the structure, Ritz and his team ran 22 different scenarios on how to proceed with the development utilizing the existing structure and came up with the plan revealed during the meeting last night.

In the opinion of the developer, this plan has the best chance at being approved for rental housing tax credits through the Indiana Housing Development Authority. The same rental tax credits awarded other developments in the county that are currently under construction.

Ritz said he expects the project to cost about $4 million to complete. A figure that met with raucous laughter from some of those attending the meeting Tuesday night.

That laughter accented a night in which several members of the crowd berated the representatives from Paragus and TRI-CAP. At one point during the open discussion, a resident told the developer to leave Huntingburg.

Much of the backlash from those attending came from perceived issues around parking as well as the quality of the apartments being created under the stigma they would be subsidized or the residents would receive subsidies to pay for them.

Ritz told those attending that the apartments were not subsidized. He explained that although these apartments would receive the tax credit, the credit was designed to keep the housing affordable for the entry-level positions the local industry has available.

Addressing the quality question, he displayed three photos of his company’s developments and explained that two of them had been completed with the rental tax credits. The unspoken challenge to those attending seemed to be for them to determine which of the three had received those credits as they all appeared to be attractive multi-unit developments.

In regards to parking, Ritz explained that from a formula derived from the company’s 30 years of experience, they expected the 40 apartments would need about 51 parking spaces. He pointed out that the Fourth Street frontage on the block between Van Buren and Washington streets had room for between 38 and 43 parking spaces. He also pointed out that the public parking next to the city hall had 49 spaces available.

With the 21 spaces created next to the new building, Ritz felt there was plenty of parking available for the development.

The residents in attendance disagreed citing their own concerns for parking on the street which features a 2-hour time limit during the day.

Other items brought up included water drainage issues, play areas for children, the size of the alley adjacent to the project as well as the impact on property values along Fourth Street.

As part of the development, Paragus will request the city address concerns about the quality of the alleyway as well as mitigate drainage issues in the area.

Several residents cited a lack of playground or other space for children as a major concern. Resident Linda Mundy commented that Fourth Street is not a place for kids to play.

Ritz explained the development was designed for young workers; not families. He explained the policy on the apartments was no more than two people per bedroom. If a couple moved into a single-bedroom efficiency and had a child, they would not be allowed to stay in that unit.

He also explained they would be marketing to the workforce through the local industry with the goal of attracting that young demographic.

The overall attitude of many in attendance was that this development was not wanted on Fourth Street. Housing Service Director Neil Elkins explained they were asked to put a project together based on the revitalization studies done for the downtown area.

“If this isn’t something that’s right for the city, it’s not right for the city,” he said.

“The thing that bothers me is when we try to give the right answer to these questions, that there is laughter and mocking of those answers from people (Ritz and Mance) who have 30-some years in this business and know what they’re doing,” he added

At the end of the night, Ritz said they have now have the emotional aspect from the residents to consider as they move forward. “They (residents) have lived here for years and years so they are emotional and they should be. The city asked us to make a proposal based on facts they laid out to us based on expert studies they commissioned,” he explained. “What the neighbors want and what the city believes it needs don’t always align.”

He admitted they would take the residents’ concerns into consideration but those concerns were typical for a project like this.

Ritz and Mance would like to have an application into the state by November. To do so, they will be working with the city to complete initial plans for the project. If the tax credit application is approved, they plan to start construction in the summer of 2017 with completion in the fall of 2018.