Union Block developer tries for tax credits

The city of Fort Scott will take another shot at trying to get housing tax credits for a proposed workforce housing development in the downtown area.

City Commissioners on Tuesday approved a motion to allow the city to apply once again for state Affordable Housing Credits for the Fort Scott Lofts, a proposed housing development in the Union Block building at 18, 20 and 22 S. Main St.

Director of Economic Development Rachel Pruitt gave commissioners background on the plan, which involves redevelopment of the building into 27 loft-style apartments; a $5.5 million project for a mixed-use, mixed-income development. It would create up to 1,500-square-feet of commercial space. Pruitt presented data on employment and housing, as well as some facts on downtown residential development as she emphasized the need for and importance of affordable housing.

The building is one structure with three separate addresses.

Pruitt said the developer, Flint Hills Holding Group LLC, did not receive state historic or low-income housing tax credits that were applied for in 2017 to help finance the project. The tax credits are beneficial in that they allow property developers “more affordability” in financing developments, Flint Hills Holding would foot the remainder of the project’s total cost.

In October, Flint Hills Holding took ownership of the building. The commission that month approved a motion for city officials to work with the company on a contract toward stabilizing the structure.

The Fort Scott Lofts project is a mixed-income development but will be for multi-family and general occupancy. The affordable units are rent-restricted to tenants who make 60 percent of the area median income and the market rate units have no income restrictions at all, according to a fact sheet Pruitt provided.

The Western Senior Living apartments, which opened in late 2016, were developed by Flint Hills Holding, which received tax credits through the Kansas Housing Resource Corporation for that project. That development is about 75 percent affordable and 25-percent market rate apartments. For a single unit, the occupant must make less than $25,380 and for a double occupancy, combined income must be less than $28,980, the information said.

Pruitt shared with commissioners some data on employment and housing in Fort Scott. The income per capita in Fort Scott, $19,823, is 31 percent lower than the national average. The median household income in Fort Scott, $33,175, is 38 percent lower than the national average.

The information said the median rent asked in Fort Scott, $595, is 35 percent lower than the national average. The number of renter-occupied households in Fort Scott, 41.6 percent, is 17 percent higher than the national average.

“We don’t see a big issue in renters qualifying for these apartments,” Pruitt said.

According to demographical information for Fort Scott, the renter demographic is 43 percent compared to 35 percent in the state. The median resident age in Fort Scott is 37.2 years compared to 36.5 years in the state.

Pruitt said the Western Senior Living project, which created housing for seniors downtown, was the “catalyst for housing” in the downtown area.

“There are 35 people now living downtown,” she said.

The information said decent, affordable housing is important to families and can attract and retain employees in communities, which can also stimulate economic growth. Affordable housing is defined as housing for tenants who have three to four times the rent amount in income. Low-income housing is defined as housing for people who barely have two times the rent in income.

“We have no shortage of jobs but there is a shortage of people,” Pruitt said. She also shared a flyer that lists all of the job openings in Fort Scott, as well as locations that offer free use of computers and internet access.

The data also showed that 65 percent of relocating workers planned to rent for at least the first year after a transfer.

“Employees are more likely to rent than buy,” she said.

The unemployment rate for Fort Scott is 2.7 percent compared to 4.4 percent in the state and 5.8 percent nationally.

“Our unemployment rate continues to be low,” Pruitt said. “I’m willing to flip over any rock for any economic development benefit we can get.”

Pruitt said applications for the housing credits are due no later than Friday, Feb. 2. She said there is about a “50-50” chance of receiving the tax credits. Pruitt said she and other city officials plan to start a grassroots campaign to garner community support for the project. A similar campaign for the Western apartments took place in 2015.

“The application process is very aggressive,” she said.

She said city officials also do not want to increase taxes to help finance the project.