TR Commission gives go-ahead torental homes development

By Rick Cordes
C-N correspondent

THREE RIVERS – Allen Edwin will begin construction of 37 rental units in the Three Rivers Meadows subdivision following approval by the Three Rivers City Commission of the builder’s proposal.
Commissioners, in regular session Tuesday, Nov. 18, voted 4-1 in favor of the plan. Voting yes were commissioners Christopher Abel, Steven Haigh, Carolyn McNary and Mayor Tom Lowry. Pat Dane voted no, and commissioners Lucas Allen and Torrey Brown were absent.
Allen Edwin’s proposal calls for construction of 37 two-story single family stand-alone three bedroom units, to be built at an estimated cost of $9.5 million. The “Copper Bay” branded homes will be built in the eastern portion of The Meadows subdivision and will feature two tiers of rental cost: actual, and Workforce Development.
Funds for the project will be partly generated through the Michigan Brownfield Redevelopment TIF, under which property taxes generated will be directed to Allen Edwin as an incentive to provide housing stock. The City of Three Rivers will, during the term of the Brownfield program, receive no property tax revenue
Based on a State of Michigan Brownfield Redevelopment incentive, the plan has drawn considerable attention and opposition, and during the special public hearing portion of the meeting, opponents took to the microphone to express their concerns.
Two objections were shared by several of the speakers: the fact that the City would receive no property taxes, and that the length of the abatement would be 18 years. “I have total disagreement with this,” said Pat Cass, noting that City taxpayers would meanwhile be paying for the city’s infrastructure .
Christian Talbot thought the sum of the lost tax revenue over the terms of the Brownfield agreement was out of line. Lynn McLeod said that she thought the plan exposed the City to financial risk. Jenny Graham questioned whether Allen Edwin was a wise choice for conducting the construction. Char Zavala said the lost tax revenue would affect the Three Rivers schools. Several speakers were alarmed that the homes would only be 10 feet apart.
The commission reconvened in regular session at the close of the public hearing and heard a presentation by Allen Edwin (AE) representative Brian Farkas.
“We’re not going to put something in that’s not going to sell (rent),” Farkas told the commission. He presented market statistics to support AE’s faith in the viability of the plan, stating that sales of homes locally indicated an ability of buyers to pay from $2,200 to $2,800 monthly (or $1,600 to $1,800 for “Workforce Housing” )— in line with what the AE homes will rent for.
“A lot of people will want to move to Three Rivers” to rent homes, Farkas said.
Farkas noted that because of objections raised previously, alterations to the original plan have been made, including the installation of an electronic gate at the intersection of Bush Blvd., and the imposition of a ban on ATV’s and gas golf carts . Also, AE will contribute $10,000 annually after the first three years (to increase 2 % per year) to support the city’s police and fire departments.
However, to offset those costs, AE proposed going from 16 to 18 years in which to receive the Brownfield tax diversion benefit. That change did not sit well with audience members or commissioners.
“It’s not good optics,” Lowry said. He then asked Farkas if there could be an immediate negotiation. After a pause, Farkas said, “Yes, we’ll take that risk” and the Brownfield term returned to 16 years.
Commissioner Abel moved for approval of the plan, and discussion ensued. Dane stated strong opposition.
“I don’t know why we have to have rentals,” she said. “Why aren’t we building homes for more people to move into?” Dane asked what the status of the 425 property transfer agreement was. “Let them build it without the Brownfield,” she said.
Farkas said that it would not be feasible to build affordable housing without the Brownfield incentive.
Abel, McNary and Lowry all spoke in support of the project.
“I like to see things grow,” Abel said. “The housing stock is very old in this community,” he noted. “We need to decrease the age of the housing stock.” Supporting AE, Abel said,” They’ve worked with us. We’ve seen what they’ve done—a really good job. Right now we’re getting nothing from the property (the proposed building site.)”
McNary said, “I support this plan. It’s our future. It will bring in people. It will bring in companies.” She asked, “What do you (opposition) want—everything to stay the same?”
Lowry noted AE’s current activity in the City. “They’ve done 7 projects. I feel comfortable with this company. They’re the only ones who are doing anything (building rental locally).
In response to questions about the rental rates Lowry said that the prospective renter likely won’t come from within the City o its school district. “People who know a good bargain when they see it.”
Lowry’s answer to the question “Why do this?” “Because we get housing stock. “
The Three Rivers Community Schools will see a “tax diversion,” Lowry said. Under current state law, school operating taxes can be diverted—in Three Rivers’ case $70,000 for 16 years. The loss will be compensated by the rental units bringing in new students for which the school will receive per-pupil state aid, Lowry predicted.