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City approves IRB support for 716 Morrow Street workforce housing project
Summary
The Manhattan City Commission approved a resolution authorizing industrial revenue bonds and related sales- and property-tax incentives for the five-unit Morrow Flats project at 716 Morrow Street; the developer plans about $800,000 in improvements and a performance-based property tax abatement.
The Manhattan City Commission on June 17 approved a resolution finding it advisable to issue industrial revenue bonds (IRBs) and to enter an economic development agreement with Midtown Holdings LLC for a five-unit housing project at 716 Morrow Street.
Stephanie Peterson, director of community development, told commissioners the presentation closely matched one brought to the commission on May 13 and summarized the package for Morrow Flats: a reimbursement-based workforce housing sales-tax grant, an IRB sales-tax exemption and a performance-based IRB property-tax abatement. "We had this project for you back on May 13. So the presentation is very similar to what you saw then," Peterson said.
The packet and staff summary describe roughly $800,000 in developer investment and five housing units. Peterson said the proposed property-tax abatement would be tied to project performance, with payments from the property owner continuing according to a schedule included in the agreement; staff also presented an ad valorem summary showing collections after a 20-year abatement period. Bond counsel required a cost‑benefit analysis, Peterson said, and that analysis was included in the commission packet.
The council held no public comments on the item before moving to a vote. The motion to approve resolution number 061725b passed 5-0 at the meeting roll call: Commissioner Oppelt — yes; Commissioner Motta — yes; Commissioner Mitten — yes; Mayor McCullough — yes; Commissioner Adamczyk — yes. The resolution authorizes the city to proceed with the IRB process and to execute the economic development agreement with Midtown Holdings LLC.
The action authorizes staff to pursue the IRB sales-tax exemption, the sales-tax reimbursement grant and the performance-based property-tax abatement as described in the agreement. Staff told commissioners the sales-tax grant is a reimbursement program and that the property-tax abatement schedule includes a roughly 5% annual increase in payments until the abatement expires. The cost‑benefit analysis and the agreement language will govern the exact payment and abatement schedules.
Because the abatement is performance‑based, tax collections after the abatement expires were shown in the staff summary but the agreement ties abatement levels to leasing performance and the amount invested in the project. No specific enforcement or clawback metrics beyond the performance linkage were detailed at the hearing.
Planning and economic development staff indicated the item had been discussed at a May work session and that the current action implements the previously given guidance.
Votes at a glance: Resolution 061725b — determining advisability of issuing IRBs and authorizing an economic development agreement with Midtown Holdings LLC for 716 Morrow Street. Motion approved 5-0; mover/second not specified on the public roll but roll-call votes were recorded.
