Clear Lake council endorses application to assist 30-unit townhome project in Emerald Edge subdivision
CLEAR LAKE — The Clear Lake City Council last night approved a resolution of support of an application to a state housing tax credit program by a developer looking to place a 30-unit townhome development project in the new Emerald Edge subdivision.
The five-acre tract where the houses would be placed would be on the west side of the future extension of North 14th Street, with the targeted price range per unit in the $275,000-300,000 range. In order to make the project economically viable, the developer, BAM Development LLC of metro Des Moines, will apply to the Iowa Economic Development Authority’s Workforce Housing Tax Credit Program, with the application requesting $1 million in tax credits, the maximum possible for a project.
Michael Bousselot of BAM LLC says the credits are critically important to move forward with the project. “And why is that? Well, quite frankly, the juice has to be worth that squeeze. We’re going to take a significant amount of risk. Mr. Flory commented that this is a $7.5 million project, I think in the end it will be closer to an $8 million capital investment into this community, just in terms of what we are building. Unfortunately prices aren’t going down, whether it’s on construction or frankly anything else, and that’s something that we’ll take into account.”
Bousselot says they wanted to build homes to be owned, which is what the public has stated they need in the community. “We heard frankly from you and the community in our meetings, and so there are two types of units instead of one, it’s not just sort of the same thing over and over as you see. It’s also something that’s built for ownership. These are not built to rent, and they certainly not built to short-term rent, which was another message that we heard loud and clear. These are going to be build to look and feel like Clear Lake from what we can best tell, but also be a place of community.”
If the tax credit application is approved by the IEDA, the city of Clear Lake would provide a $1 million tax abatement as a necessary local match, which Bousselot says is a good investment into addressing the housing needs of the community. “It would go towards importantly the extension of the infrastructure to make this an accessible place for residents to get to. That helps us long-term, but more so it’s going to help your community long-term, as you can see where the growth of this subdivision is going to be. The other piece is the abatement. I think it’s important when we talk about what incentives we are getting. That abatement will be passed on to the land owners in the end. That’s something that will be an incentive, and frankly be needed with the interest rate environment we’re at.”
An award announcement would be made by the state in August. In last year’s program, there were 133 applications received requesting nearly $80 million, with 57 projects being funded at a total of $35 million in tax credits.