Developers seek PILOT for Storyville apartments as council reviews contamination, funding gap

Developers of the Storyville affordable-housing project asked Logansport City officials to approve a payment in lieu of taxes, known as a PILOT, and walked the Board of Works through the phase‑1 site plan, remediation strategy and financing gaps.

The project team said the PILOT was necessary to make operations sustainable because the development relies on federal and state housing funds and low rents. “Hi. I’m Keith Johnson who was filling in for Oscar Gutierrez,” said Keith Johnson, a developer representative, introducing the team and materials the developers had provided to the city.

The developers and the board spent the meeting on technical details: the phase‑1 plan calls for three residential buildings with about 24 units each (72 units total in phase 1), two retention/detention basins, amenity areas and a center building with a leasing/management office. John Kilmer, an architect with BCA, answered site‑layout questions and said the design had been revised to shift buildings west and to limit building footprints to address neighborhood integration.

Why it matters: the PILOT request is tied to the state housing award and to the project’s ability to close financing. Developers said the PILOT also helped them score points in the state award process, and that without the PILOT the deal would not be feasible. Council members pressed the developers for details on how the PILOT figure was calculated and how the city would hold PILOT receipts in a restricted fund for housing initiatives.

Developers described the financing and operational tightness. They said the entire development is more than $20 million in hard and soft costs and that the project carries an approximate $7 million financing gap the developer expects to cover and recover through operations. The team explained that the project qualified for federal and state subsidies and had been awarded 4% low‑income housing tax credits for the current application; the 9% credits that fund amenities such as a daycare were not awarded to this submission, so the daycare would not be included in phase 1 unless later funding is secured.

Board members and staff asked technical and public‑safety questions the developers said they had already studied. The site includes monitoring wells and areas of metal and solvent contamination from prior industrial/railroad uses. The project team described a two‑part remediation approach: excavation and replacement or covering of metal‑impacted soils, and building design measures for solvent vapor protection. The developers said occupied structures in solvent‑affected areas would use slab‑on‑grade construction with sub‑slab depressurization systems (similar in principle to radon mitigation) and that buildings are not being sited directly over the most contaminated areas.

On timing, the developers said construction must begin by November to meet program rules and that they expect the building schedule to run 16 to 18 months, depending on weather and other variables. The team said they plan to apply again for 9% credits for later phases and will time applications so phase‑1 financing and construction do not conflict with future applications.

Council discussion focused on process and public accountability. Several council members said they were surprised the PILOT had been part of the state application before the council had formally reviewed and endorsed it. Council members asked the developer to provide the project pro forma and more detail on how the per‑unit PILOT was calculated; the developers said $100 per unit is a common industry convention for similar state‑awarded projects, and council members debated whether that produces a fair return for the city.

Action: Board members present agreed to move the item to the council meeting on June 2 for additional review and submission of the developer’s pro‑forma and fund/account details. Council Member Chris, Council Member Susie, Council Member Cam, Council Member Scott and Council Member PJ indicated support to advance the item at the Board of Works meeting.

Next steps: city staff asked the developer to provide pro‑forma documents and suggested attorneys and the clerk prepare a draft PILOT agreement and a segregated fund or trust mechanism for receipts. Council members and staff also asked for follow‑up on monitoring‑well data, detention‑pond depths and final site geometry prior to any formal PILOT approval.

The board did not adopt any PILOT contract or tax agreement at the meeting; members directed staff to place the item on the June 2 council agenda for further review and public comment.