Tax district causes council to balk at funding for housing developments

The county council raised some objections to a request for $200,000 for the recently revealed Vine Street housing projects in Jasper.

Pete Schwiegeraht, representing Miller-Valentine, a development group based in Cincinnati, asked for the funding for two new projects that include the former Jofco building at 14th and Vine streets and the former Jasper Wood Products building that now houses Monster Recycling at 1316 Vine Street.

The county provided $100,000 in economic incentives to Miller-Valentine for The Lofts at St. Joseph’s in Huntingburg where a portion of the former hospital is being transformed into a senior-living community.

Now, Miller-Valentine is asking for $100,000 for the Jasper Lofts and $100,000 for an as yet named senior housing project in Monster Recycling.

The group was already moving forward with developing portions of the Jofco building into 70 workforce development housing units as part of Phase I. Last week, they announced an additional 40-50 units are planned for Phase II in the building.

“When we completed a housing study, there was a demand for as many as 200 to 300 units in your community,” Schwiegeraht said.

The developer also revealed that a letter of intent to purchase the Monster Recycling building had been completed and the firm plans on creating about 60 to 70 units for another senior-living community.

“The owner has come to the conclusion it is in their best interest to close down the business,” Schwiegeraht said. “We are looking to do senior housing there. The market study revealed there was a need for 150 to 200 senior units in the county.”

A story on these developments was published here.

Schwiegeraht pointed out that between the three developments, the total amount of reinvestment in the community is between $30 million and $32 million.

In asking for the county’s funding for the developments, Schwiegeraht explained it would help the developer’s scoring on an upcoming round for housing tax credits.

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The City of Jasper has already agreed to contribute $450,000 to Phase I of the housing development through a recently approved property tax abatement as well as their own economic development income tax funds. Schwiegeraht said he was hopeful these other projects would receive similar consideration by the city at a rate of about $6,000 per unit.

But Councilwoman Becky Beckman voiced concerns that since the developments were in the large tax increment finance district created by the city in March, the county would not likely gain any benefit from the additional property taxes the projects would generate.

“From what I understand, this area is already in the TIF district Jasper created in the past six months or so,” Councilwoman Martha Wehr agreed. “Any increase in assessed value over the next 25 years will go into that TIF. It won’t help the county whatsoever.”

Although property taxes through residential housing cannot be captured by TIF, the increased property tax increment created by a commercial residential development can be captured by the TIF district.

“That’s not always a win-win for the county,” Beckman said. “That’s more of a kick in the teeth to the county.”

Councilman Nick Hostetter noted that the county has a lot to gain by the increased economic development income taxes (EDIT) and county option income taxes (COIT) created by more people moving into the area.

Schwiegeraht explained that the properties weren’t generating that much property tax revenue for the county now. He stated that repurposing the old buildings would clean up a blighted area of the city and provide services to the entire county. “Right now, there are not many, if any, new housing options in the county in regards to rentals,” he said. “Ultimately, we are speaking about buildings that are valued at $100,000 to $300,000 that will be reappraised and reassessed at millions of dollars that will generate new taxes at some point.”

The Jasper Lofts will feature one- to four-bedroom apartments ranging in price between $575 to $850 – or 60 percent of the assessed median income of the applicant.

The senior housing in the Monster Recycling building will feature one- and two-bedroom units for $575 to $650 respectfully.

The council tabled the decision on the funding until theMonday, November 19 meeting. At that time, if they decide to provide the requested funds, a letter from the council will be generated to be included in the housing tax credit application.

“I hope we can see the bigger picture here,” Schwiegeraht said. “I can see and understand why you might have pains with the TIF. But it doesn’t take away from the benefit to the community and the amount of reinvestment it is going to create in an area that is otherwise sitting dormant and falling apart. $20 million with a new investment in the community versus further deterioration.”

The council also took the following actions.

-Approved the following budgets for 2016: $15,816,588 for Dubois County; $237,018 for Dubois County Solid Waste District; $698,750 for the Dubois County Airport Authority; $10,750,938 for Northeast Dubois School Corporation; and $112,000 for the Northeast Dubois Fire District.

-Corrected an oversight in which the Dubois County Community Corrections Center custodian Jerry Gramelspacher was not included in a round of bonuses for the center’s employees. The $111.40 oversight occurred due to Gramelspacher being paid from county funds rather than through the corrections center funds.

-Discussed a bonus for Jenny Fuhs, the former Dubois Community Corrections Center assistant director, who took over the interim director position in December and served in it until William Wells was appointed the center’s new director. Fuhs resigned from the center last week. According to Auditor Kathy Hopf, the center advisory board voted to give Fuhs a $1,000 bonus for the nine months she worked as interim director but was still paid at her rate as the assistant director. The amount is significantly less than what Fuhs would have received had she been paid as the director. Hopf estimated the difference could be a bit over $6,000. Council President Greg Kendall declared he would not approve $1,000 bonus for Fuhs service as he considered it far less than she deserved. “It’s just not right,” Kendall said. Hopf will provide the council with a more exact figure for the difference at the next meeting.