Article via Idaho Mountain Express.
Low-income project would bring 60 units to downtown Hailey
After years of false starts, seniors will be coming back to Blaine Manor.
The Idaho Housing and Finance Association approved $5.79 million over 10 years in tax-credit financing to build a 30-unit apartment block on the fallow lot that once held the Blaine Manor skilled-nursing facility off Hailey’s Main Street, according to Michelle Griffith, executive director of the ARCH Community Housing Trust, which applied for the funding.
That should pay for one of two buildings proposed, Griffith said. The IHFA also approved a $2.62 million bond to pay for a separate 30-unit “family” development on another portion of the lot. ARCH and its partner, The Housing Company, fleshed out funding through the Federal Home Loan Bank of Des Moines and the U.S. Department of Housing and Urban Development’s HOME grant program.
As of Tuesday morning, all funding had been secured, Griffith told the Idaho Mountain Express.
Her next step: working with the city of Hailey to subdivide the lot, draft a planned-unit-development agreement, pass design review and, eventually, come up with a building permit. Griffith hopes to get construction underway on both buildings late next summer.
The financial approvals reward the faith—and the funding—of the Blaine County commissioners, who backed the project with $500,000 in public cash and nearly all of the county-owned 2.7-acre Blaine Manor lot, which the board previously valued at around $2 million. That translates to about $41,666 per unit.
Griffith finalized the deal Monday, and told the commissioners during their regular meeting Tuesday morning. The announcement comes a year after a first attempt, seeking nearly $8 million through the same mechanism, fell short. But much has changed since. The IHFA changed its funding rubric to reward areas shut out of the annual allocation in the past, and to incentivize adjacent development, like the second Blaine Manor building, Griffith said. And, the county doubled its support, committing an additional $350,000, plus the full measure of land, during its fiscal 2020 budget process.
With that in hand, ARCH went bigger overall, with a lower per-unit cost.
“We knew we had to take advantage of everything we could, and we had to get cheaper,” Griffith said.
The senior-specific building will be open to residents 55 and older, with 26 units reserved for those at 60 percent of area median income or less. In the family building, all 30 will be for people earning 60 percent of AMI, Griffith said. Locally, that translates to $32,000 for an individual or $45,660 for a family of four, based on HUD’s 2019 figures. (The government’s annual thresholds will be updated with new data in the spring.)
“We knew we had to take advantage of everything we could, and we had to get cheaper.”
Michelle Griffith, ARCH Community Housing Trust
The IFHA serves as the state gatekeeper of federal tax-credit financing, relying on a rubric called a qualified allocation plan to score projects—and, ultimately, award funds over a 10-year period.
Last year, Blaine County’s overall wealth hurt local applications. HUD, which ultimately generates tax-credit financing, weighs applications from “qualified census tracts” more heavily. Those are areas where half of all households sit below area median gross income, or have a poverty rate of 25 percent or more. Blaine County doesn’t have any such areas, according to HUD’s 2019 assessment.
This year, the form shifted weight away from the designation, Griffith said. Under the revised rubric, the price of construction was the main challenge for local projects. The IHFA uses the cost per unit to break ties in its scoring—the lower the better. That’s why Griffith said the county’s contribution was crucial—with the free land and the $500,000, Blaine Manor began to look pretty good.
Over the summer, the Ketchum Urban Renewal Agency took a similar tack, committing $400,000 to back a separate project applying for the same form of IHFA financing to build a 50-unit rental development in downtown Ketchum. Greg Dunfield, of Seattle-based GMD Development, was notified that his application for tax-credit financing wasn’t approved this round, the city announced earlier this month.
“High cost of construction in Ketchum is the reason that we weren’t funded,” Ketchum Community Development Corp. Executive Director Charles Friedman said in a media release from the city. “This is also why the tax credit award is so necessary for us to build affordable housing.”
Designed for the site of the current city hall, Bluebird Village would have brought 57 units to downtown, 54 of them affordable, according to Dunfield’s applications. To build it, he asked for the most of any of the 15 applicants: just shy of $11.3 million over the 10-year life of the credits, plus some $3 million in bond funding.
Bluebird Village reached a qualifying score, but fell short in the IHFA’s cost-based tiebreaker, according to city spokeswoman Lisa Enourato.
“Project cost now seems to be the only differentiating factor in the allocation plan, a factor difficult for Ketchum to compete with,” the city stated.
Scott Niblack, of Denver-based Terra Realty and Management Inc., proposed a third Blaine County project, to buy and refurbish the Snow Mountain Apartments in Hailey. On Tuesday, IHFA spokesman Dean Johnson said he would not comment on whether that project was approved until all financing is finalized.