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The Watertown City Council approved the city’s 23rd TIF district at the Harmony Hill Addition near Mother of God Monastery which should see 40 new affordable homes built for prospective area residents with prices as low as $160,000.
The 20-year-long tax increment financing (TIF) district will freeze property taxes at the proposed development along Challenger Way near 20th Avenue SW until 2029 when the increment will be collected until 2046.
The total TIF eligible costs for the project are about $2.35 million, but the developers are only requesting $2.1 million in TIF funding for the $12 million project.
Michael Klatt, the strategic advisor for the Mother of God Monastery, and Joy Nelson with Haugan Nelson Realty, both board members at Harmony Hill, testified during the meeting.
“I think it’s no secret that workforce housing is much in demand,” said Nelson. “The housing development at (Harmony Hill) is critical and much needed by the City of Watertown.”
She called the TIF a textbook one, saying “this is exactly what TIFs were designed for, and will really enhance the City of Watertown.”
Klatt said the TIF project also satisfies a number of goals for the Watertown community he said were identified during housing conferences, though he didn’t say what specific goals were. Regardless, he called the new development a blessing.
Toby Morris of Colliers Securities, the consultant for the city, also testified at the meeting remotely.
“Consistent with the other TIFs that you have done, this is not a liability on the city by any means,” he said. “The developer has taken 100 percent responsibility of any debt that’s incurred.”
Morris also said he appreciated the work the sisters of Harmony Hill have done.
“It may not fit the religious beliefs of the sisters, but I would love to clone them to put them in other communities,” he joked.
Councilman Michael Heuer asked a representative of the developer, Seth Fryer, what the square footage of the houses will be as well as what the target price point is.
Fryer said the houses range anywhere from 736 to 1,400 square feet with prices capped at $300,000.
“We were tasked to keep those houses at $300,000 and less,” he said, though he noted there are houses in the development that will be more expensive. “We wanted to keep those just so that way if someone in the community would approach and say that they have a budget bigger than that, then we (can) accommodate them.”
Heuer said he thought the development has already done a lot to positively impact the community but pointed out $300,000 isn’t what most people will call “affordable.”
“I warn you that with the public, they’ll see that $300,000 number and you’ll probably see comments,” he said.
Fryer responded, saying the lowest square footage houses will likely be priced around $160,000.
“Most of (the houses) will (be) fairly well under $300,000,” said Fryer.
Councilman Kyle Peters said the TIF was well-written because it only asked for money to put in infrastructure, and the city isn’t at risk if the development falls short because the developers have taken on the risk.
“To take what Joy said, this is exactly how (TIFs) should be written,” he said.
Nelson spoke again at the meeting.
“These are the people that are calling me that I cannot accommodate,” she said, speaking of people who are seeking affordable homeownership. “I have nowhere to put them, other than a rental. This is their opportunity to be able to have homeownership.”
The TIF district was approved unanimously, though Councilman Doug Allen was absent.
In other news the council:
- approved a change order for the drainage project that will help reduce flooding in the Stokes-Thomas Lake City Park campground, a project Parks and Rec Director Dusty Rodiek said will, in effect, expand the camping capacity of the campground by reducing the days lost to flooding in certain plots.
- heard a presentation from Sen. Glen Vilhauer on how the recent legislative session affected municipalities like Watertown.
- approved a bid award for improvements for the trail system along 14th Avenue Northeast.
- approved a bid award for the installation of asphalt on the trail within McLaughlin Park and a portion of the trail in Memorial Park as well as a partial reconstruction of the gravel roadways in the Mount Hope Cemetery which will see them paved.
- heard during city council announcements that the Second Street closure, near County Fair Foods will last until May 31 as per a permit requested by the developer.
