Ideas for funding College Road affordable housing complex start to emerge

BY PRU SOWERS

KONK LIFE STAFF WRITER

The picture of how the city will pay for the now-fast tracked affordable housing development on Stock Island got a little clearer recently when Key West City Manager Jim Scholl outlined potential funding options to city commissioners.

When local residents voted in March to approve a height variance allowing the 104-unit project to rise to 40 feet – the local ordinance tops out at 25 feet – it was unclear what the project would cost or how much of the budget would be on taxpayers’ shoulders. At the commission’s May 1 meeting, Scholl said the project is estimated to cost $25 million and three sources of potential funding are being sought.

The largest amount of money, $10 million, would be requested from the federal Department of Housing and Urban Development (HUD), which allocated $616 million to Florida in November for disaster community development block grants. Since then, another $791 million in block grants for Florida have been set aside by HUD to help the state recover from Hurricane Irma. Monroe County is set to receive a portion of the block grants and a minimum of $20 million is anticipated to be spent on affordable housing in the Lower Keys.

“The state is working on the rules under which that money can be applied for,” Scholl said.

The second funding option will be requested from the Monroe County Land Authority, which receives a portion of the Monroe County bed tax money to acquire property for affordable housing, recreation and conservation. The city is hoping for between $5 million and $6 million, which has to be approved by the land authority board.

If Key West is successful in receiving those funds, it would still need to find another approximately $10 million if the project bids come in around the $25 million early estimate. That’s where taxpayers would come in, paying for a municipal bond that would cover that portion of the project cost. But the taxpayer share could be reduced by the rents collected from tenants in the College Road housing development. Those rent levels have not been set so early in the planning process but the complex will be aimed at low and very-low income tenants.

“Based on the initial pro-forma document,” Scholl said about the preliminary funding plan, “it looks like we can make that work for that property with 104, 105 units potentially there.”

The next step is to work out a proposal with the city’s contracted architect, Bill Horn, to draw up a preliminary design that would be used in the bid process with developers. Scholl said he hoped to have an agreement with Horn for commissioners to see at their next meeting on May 15.

“What we need now is a concept-type drawing of an initial plan. So, we intend to engage Bill Horn for that, our architectural qualified contractor, to do that and work with [Key West Housing Authority Executive Manny] Castillo,” Scholl said.

The city hopes to be able to apply for the disaster community block grant program in October. And the use of any Land Authority funds and a possible bond issue would have to be approved by the land authority and housing authority boards, leading Mayor Craig Cates to express disappointment at the project timeline, which he said seems to be “stretched out.” At this rate, he said, the project won’t be done before the 2019 hurricane season.

“We were talking about it being much sooner,” he told Scholl. “I hope you understand the priority of this project and the importance of it. I know you do.”  

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