$5.8 million affordable housing development planned for Huntingburg

Sourced from Dubois County Free Press

A new $5.8 million affordable housing development could bring 56 apartments to Huntingburg.

Indianapolis-based developer Paragus Group plans on creating the apartments in three new buildings located on the former Huntingburg Wagon Works property on N. Washington Street. The development will include several studio apartments as well as one- and two-bedroom apartments.

Residents will have to be employed and comply with the rent-controlled guidelines through the state. Rent on the units will range from $234 to $351 for the studio apartments, $474 to $539 for one-bedroom apartments and $599 for two-bedroom apartments.

Approval for the units is determined by an individual or family’s income. For example, to qualify for a two-bedroom apartment, a family’s income cannot exceed $40,000 annually. The state will audit the apartments annually to ensure they are complying with the requirements attached to the tax credits for the development.

The Huntingburg Economic Development Commission approved forwarding a recommendation for tax abatement for the project to the council for consideration. The abatement recommended would be for 10 years for 100 percent of the property taxes on the development; about $28,000 annually.

Bill Kaiser and Dave McGimpsey, both attorneys with the firm Bingham Greenebaum Doll, were present during the meeting representing Paragus Group. According to McGimpsey, the abatement is a necessary component for Paragus to move forward on the project.

“From an abatement standpoint, the cost of construction is still similar to that in a city but rent will be less in a rural community, so the money that comes in from that is less,” Kaiser added. “That is why the abatement is so crucial for the economic feasibility of this development.”

He explained that since OFS Brands plans on demolishing the building, the city wouldn’t benefit much from the property taxes there if it wasn’t developed.

As part of the Stellar Community application, Huntingburg identified the creation of affordable housing as one of its projects. Paragus Group has been interested in creating a housing project in Huntingburg for a couple years. A proposal to develop apartments in the WTH building across from City Hall was scrapped last year after several citizens and some businesses came out opposed to the location on Fourth Street.

For the new project, OFS Brands is in the process of demolishing their building located on the property where the wagon works was originally located at 419 N. Washington Street. According to City Planning Director Paul Lake, the site has passed the environmental inspections.

Once it is demolished, Paragus plans on purchasing the property to begin development if it is awarded tax credits through the Indiana Housing and Community Development Authority.

The company must complete an application for the tax credits by November for consideration next year. To complete the application, the development must step through several local bureaucratic hoops that include a variance to allow multifamily housing in a heavy industrial zone, a variance for the studio apartments included in the plans, the creation of an economic revitalization area and a tax abatement.

Through the Stellar designation, Huntingburg has the opportunity to attract a developer to take advantage of $1.5 million in tax credits awarded by the Indiana Housing and Community Development Authority. Paragus’s application will encompass those credits.

“The developers of this project have done a great job at assessing what our community’s needs are and also have been very sensitive to concerns raised over previous projects,” Mayor Denny Spinner said. “I feel that this project meets those needs. We have heard loud and clear from our employers that this is the type of apartments that are necessary to continue to attract workforce to Dubois County.”

He added that the project will redevelop an area that would otherwise be an empty lot near the downtown. He also pointed out that the building being demolished by OFS Brands is not the original wagon works building.

The council will consider the recommendation at its next meeting scheduled for 7 p.m. on August 22 in the Council Chambers at City Hall.