An out-of-state non-profit developer is dropping its plan to purchase the Prairie Vista Apartments in north Peoria and convert a majority of the units into affordable housing.
Peoria City Manager Patrick Urich confirmed to WCBU that California-based Integrity Housing has withdrawn its application for up to $65 million in multifamily housing revenue bonds to finance the sale, likely ending the controversial proposal.
Fifth District city council member Denis Cyr said concerns voiced by community members over potential tax base implications likely factored into Integrity Housing’s decision.
“It’s not the everyday that we get somebody that wants to invest $60 million in a property in Peoria. The problem is the fact that it was not-for-profit, and they were looking for revenue bonds that were tax-free,” said Cyr.
“When you’ve got a not-for-profit buying some bonds like this, I mean, they don’t pay any property taxes. Peoria and the school district, Dunlap School District, were standing to lose a lot of money the next 10 to 15 years.”
Integrity Housing lists offices in Irvine, Calif., and operates as a limited liability corporation registered in Colorado. Integrity Housing was working with Ascenda Capital of Beverly Hills, Calif., to secure the financing for the Prairie Vista project.
The Tri-County River Valley Development Authority (TRVDA) had already approved issuing the bonds, which would’ve required 20% of the complex’s 304 units to be reserved for families making no more than 50% of the area’s median annual household income.
The request for up to $65 million in financing bonds would have covered Integrity’s $45 million purchase price for the complex, along with other upgrades to the property and apartments. The total investment was expected to reach an overall cost of approximately $60 million.
Dunlap school board president Dr. Abby Humbles noted the sale price exceeded Prairie Vista’s actual value and raised more red flags.
“The question was: how was this money being utilized and would they be (property) tax-exempt, because the county, especially the school district, stood to lose quite a bit of revenue, which of course then would have to be passed on to the taxpayers,” said Humbles.
“We still have to educate children, and it Dunlap more than 80% of our revenue comes from our tax base. So if you continue to chip away at it, then that’s not a good thing.”
Integrity’s business plan called for another 55% of the apartments would have been for households earning 80% of the median income, while the remainder would stay at market rate.
But about 50 residents from neighborhoods in the surrounding area voiced objections to the proposal last week at TRVDA’s public hearing on the matter, including Humbles and Dunlap Village President Jack Esterdahl.
“I think that we, as a community, were very involved; there were some very intelligent, hardworking people who did some research and shared the information,” said Humbles. “It transpired into something that was a positive income, and the school district will not lose tax revenue. It took it took some time, but I think that’s how the process works.”
A public meeting organized by Cyr to allow for more input originally scheduled for Wednesday night at Dunlap High School was officially canceled Monday afternoon. An Integrity Housing representative was supposed to be in attendance.
The Peoria City Council had been expected to consider the project at its April 12 meeting, with the option to disapprove the TRVDA bonds or take no action and allow the sale to move forward.
“All the phone calls and text messages and emails, in the five years I’ve been a councilman for Fifth District, that is the busiest time that I’ve had and for obvious reasons,” said Cyr. “We’re living in tough times and the city needs the money, the school district needs the money. That’s a good reason to be very, very concerned and be happy that the deal did not go through.”
via Peoria Public Radio
April 5, 2022 at 07:01AM