The Gazette covers City Hall, now a flood-damaged icon on May's Island in the Cedar River

First post-flood victory for new ‘affordable’ replacement housing: Cedar Pond Townhouses to go up on a part of what had been Chapman Fun World

In City Hall, Floods on March 26, 2009 at 9:34 pm

Neighbors out along Wilson Avenue SW near Williams Boulevard and Westdale Mall lost out this week on their attempt to block the construction of 90 rental units on about 11 acres of land.

Part of the site used to be home to the Chapman Fun World, but for opposing neighbors, the fun is long gone. Some 224 people signed a petition against the development, called Cedar Pond Townhouses.

The 6-2 City Council vote in favor of the development clears the way for the first newly built, affordable rental housing to be built to replace affordable housing lost in the June 2008 flood.

Much has gone into City Hall’s effort to do just that, build more affordable housing, since the first months after the city’s flood disaster.

The City Council created a Replacement Housing Task Force last September and then it successfully lobbied the federal government to increase a key federal funding tool – federal tax credits – for the state of Iowa.

The Cedar Pond development will use tax credits and some local financial incentives for much of its funding. For the tax-credit financing piece, private investors pay money upfront for a housing project’s construction and, in turn, have their federal tax liability reduced.

The upfront money allows the developer to take on much less debt, and, as a result, the developer can and must keep rents affordable. At Cedar Pond, only those earning at or below 60 percent of the average medium income for Linn County can rent the units.

The opponents made good arguments on Wednesday evening about potential problems with water runoff from the proposed development and about traffic problems that already exist in the area.

District 5 council member Justin Shields — this is his council district — was convinced. He said the site was too wet for the development. And he said he had heard before how a developer’s engineers were going to take care of everything, and then they do not.

But in these discussions about affordable housing, a central concern, too, is just who might live in affordable housing.

It’s clear it’s an issue, not so much by what opponents say, as what proponents and the developer say.

In this instance, Greg and Candace McClenahan, of EverGreen Real Estate Development Corp., Prior Lake, Minn., are the developers, and Candace McClenahan emphasized to the City Council and to the opponents in the audience that people who live at Cedar Pond must have jobs so they can pay up to $570 in rent and $78 a month for utilities each month for a two-bedroom apartment and $670 and $101 for utilities a month.

There is even a new term — work force housing — for these kinds of developments, which Mayor Kay Halloran used to express her support for the project. Given the affordable housing lost to the flood, this is “new housing for our work force,” she said.

Council member Tom Podzimek took exception to neighbors who called the rental development incompatible with the area.

“Affordable housing doesn’t seem like an incompatible use,” he said.

At the end of the day, the opposing neighbors had a tough case to make, in large part, because an early development on the same site had been given approval a few years ago. And that development had three-story buildings, not two-story ones, and it had 38 more rental units.

The McClenahans also came along with a plan at a good time when the City Council was eager to replace some of what the 2008 flood destroyed. And the McClenahans spent much time refining their plan and scaling it back as they worked to please the city’s Replacement Housing Task Force. Task force member Ben Henderson told the council just that on Wednesday evening.

Two members of the City Planning Commission also came to the council meeting to explain why the commission earlier had backed the project.

Chris Dostal, a 2005 City Council candidate, was among neighbors arguing against the development because of the traffic nightmare that he said already exists on and around Wilson Avenue SW. But the timing of that argument wasn’t the best either: the city’s multimillion-dollar viaduct project on 33rd Avenue SW will be ready for traffic in the fall and should reduce traffic on Wilson Avenue by a third, a city engineer said.

Cedar Pond now heads to Des Moines to secure tax credits from the Iowa Finance Authority. This comfortable territory for the McClenahans: They’ve built 11, regulation-heavy, tax-credit projects in Iowa and Minnesota in the last 12 years.

Three other new, new-construction, tax-credit projects have been proposed for Cedar Rapids since last September. One intended for the former Ellis Golf Course chipping area has been abandoned in the face of neighbor objections. A second at 1100 O Ave. NW is opposed by neighbors and has gotten a lukewarm reaction to date from the City Planning Commission. A third project, planned for the Oak Hill Neighborhood has yet to secure tax credits.

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