Commission sets May 20 public hearing for LK Townhomes RHID; developer outlines 26 duplex units and funding request

The Manhattan City Commission on April 15 voted 5-0 to approve a resolution of intent to consider a development plan and establish a reinvestment housing incentive district (RHID) for Frontier Development Group’s LK Townhomes project, and set a public hearing for May 20.

Stephanie Peterson, director of community development, told the commission the developer proposes 13 duplex buildings for a total of 26 units on the Little Kitten Avenue site. The project combines for-sale and for-rent units targeted to households between 60% and 150% of area median income (AMI). Peterson said the total project cost is roughly $8.86 million and the RHID request is just under $1.95 million over 15 years, which the staff presentation translated to roughly $5,000 per unit per year (about $130,000 annually for 26 units) for the RHID period.

Tyler Holloman of Frontier Development Group said the broader Manhattan Infill Housing Project includes 44 homes across three sites; 40 of those would be workforce units. He said the Little Kitten site’s 26 units are part of the award the project received from the Kansas Housing Resources Corporation (KHRC), which allocated a Moderate Income Housing (MIH) grant and housing tax credits to the development. Holloman said KHRC’s awards are competitive and that the state agency will monitor income qualifications and compliance for households using the state funds.

Holloman and partner Gavin Schmidt said the developer plans to use a mix of private equity, KHRC tax-credit equity and the RHID proceeds to close the gap between construction cost and sale price. Peterson and Holloman presented financial estimates in which the site’s current assessed value was about $406,000, generating roughly $7,000 per year in ad valorem taxes (the city’s share about $2,300). If the improved value reached roughly $8.9 million, that would generate about $153,000 in property taxes annually, with the city’s share near $50,000 under current rates.

Commissioners and staff also discussed process and intergovernmental coordination. Peterson said the county and the school district will be notified and that both entities have 30 days after the commission’s final ordinance reading to veto an RHID. Several speakers noted the school board had signaled support; commissioners discussed scheduling a joint meeting or a smaller working group with the county and school district but agreed not to delay the public hearing because the county’s veto window follows the city’s ordinance adoption schedule.

Commissioner questions focused on affordability and unit size. Holloman said the developer’s product is targeted at “young families” and will be larger (about 1,500 square feet, three bedrooms) to meet that market; that strategy pushes pricing toward the top of the RHID income band. He said KHRC rules require certification that any buyer using MHRC-backed assistance will occupy the home as a primary residence and meet income limits.

Peterson said staff had submitted required notices to the Kansas Department of Commerce and that a development plan and a development agreement will be available for public review before the May 20 hearing. Holloman said the developer had engaged a third-party financial analyst and expected that analysis to be available by the end of the week; staff said that analysis would be included in the public hearing materials.

By approving the resolution of intent and setting the hearing date, the commission advanced the statutory RHID process; the ordinance establishing the district, the development plan and a development agreement are scheduled for the May 20 hearing and subsequent readings. The county and the school district have the opportunity to veto the RHID within the statutorily prescribed period following the city’s adoption.

Votes at a glance: Resolution to set public hearing for Frontier Development Group’s LK Townhomes RHID — passed 5-0 (Mayor Karen McCullough; Commissioners Adamczyk, Opelt, Mota and Minton voting yes).

Key numbers and clarifications: 13 buildings, 26 duplex units; total project cost roughly $8.86 million; RHID request just under $1.95 million over 15 years; KHRC awarded MIH grant and tax-credit allocation; estimated current assessed value $406,000 (generating about $7,000 annually in taxes); estimated improved assessed value would generate roughly $153,000 annually in taxes.