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Council committee backs $4 million forgivable TIF loan to support new low‑barrier intake shelter
Summary
The Community Investment Committee voted to recommend a $4 million forgivable loan, using tax‑increment financing, to New Day Intake Center Inc. for a new low‑barrier emergency shelter at 4022 Old Cleveland Road; the item moves to the full council with a favorable recommendation.
The Community Investment Committee voted Oct. 11 to forward Bill 58‑25 with a favorable recommendation, approving a $4 million forgivable loan to support construction of a new low‑barrier intake shelter being developed by New Day Intake Center Inc.
Caleb Bauer, executive director of the Department of Community Investment, told the committee the loan would be made under the city’s economic development commission statute and funded from tax‑increment financing (TIF) revenues apportioned across three development areas: River West, River East and Southside. "This facility itself is located in the River West development area," Bauer said, and the forgivable loan would draw a proportionate share from the three areas to total $4,000,000.
Under the approved development agreement and proposed loan terms, New Day Intake Center (a 501(c)(3)) would construct a minimum 110‑bed low‑barrier emergency shelter; Bauer and project documents said the current design includes about 120 beds. The developer is contractually obligated to ensure the shelter is operational no later than 36 months after construction begins; the development team expects to commence construction before the end of the year and the loan agreement would be executed on or before Jan. 1, 2026.
The agreement calls for a minimum private developer investment of $10,000,000. Bauer said the city’s $4,000,000 contribution would be delivered as a forgivable loan tied to project completion (certificate of occupancy) and ongoing reporting requirements. Bauer added that, "for 10 years after substantial completion of the project, the developer shall submit to the redevelopment commission a report demonstrating compliance with the post completion reporting contents as set forth in the redevelopment commission's development agreement."
Sheila McCarthy, executive director of New Day Intake Center, told the committee the project was nearly fully funded for phase 1: "We're 95% of the way to phase 1. We'll continue fundraising through the end of the fall, the end of the year." She also said the nonprofit has hired a construction manager and expects to provide a firm start date shortly.
Bauer said the operating relationship with the city would be set out in a separate five‑year operating agreement that the administration has proposed in the 2026 budget: "It would provide $500,000 annually over a 5 year period," Bauer said, and that appropriation is part of the Department of Community Investment’s 2026 budget request. The redevelopment commission previously approved an option to purchase the group’s current Knights Inn (Lincoln Way West) site for $1 to be exercisable six months after operations commence at the new facility.
Funding for the wider project includes private donations, grant funding and a HOME‑ARP allocation to support non‑congregate components; Bauer described the HOME‑ARP allocation as a separate HUD‑administered distribution intended for non‑congregate shelter. He also noted the county had not provided funds for the capital project at this time.
After questions on staffing, timeline and future permanent supportive housing opportunities, the committee voted 5‑0 to send Bill 58‑25 to the whole council with a favorable recommendation.
