Topeka review committee recommends $4.8M RHID reimbursement for Union Tower District project

A significant development proposal is making waves in Downtown Topeka, as the City Council discusses a plan for 250 new income-qualified apartments in the Union Tower District. The project, spearheaded by the Annex Group, aims to provide a mix of one, two, and three-bedroom units, with rents set at a discount to fair market rates.

The proposal has sparked a heated debate over the requested reimbursement from the city’s Residential Housing Improvement District (RHID). Initially, the developers sought $7.6 million in RHID reimbursements to cover land acquisition, infrastructure, and construction costs. However, a financial analysis conducted by the RHID review committee revealed that the project warranted only $355,000 in reimbursements. After further discussions and clarifications, this figure was revised to $900,000.

In a compromise, the committee has now recommended a RHID incentive of $4.8 million, which would yield a projected 7.76% market rate of return. This recommendation comes amid concerns about the substantial gap between the developers' initial request and the committee's findings, raising questions about the potential for over-incentivization.

Council members expressed their apprehensions about the developers' financial needs versus the city's position, highlighting the importance of balancing affordable housing initiatives with fiscal responsibility. The project, with an estimated total cost of $58 million, has also received significant state and federal tax credits, further complicating the financial landscape.

As the council deliberates on this proposal, the outcome could set a precedent for future affordable housing projects in Topeka, emphasizing the need for careful consideration of financial incentives and their implications for the community.