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Commission commits $170,000 loan to 42-unit multifamily project; 12 units set aside for people exiting homelessness
Summary
The Pittsburg City Commission voted to commit a $170,000, 1% low-interest loan to support a 42-unit multifamily project proposed by Vecino Group and Building Health Inc., including 12 units set aside for people exiting homelessness and an expected application for 9% low-income housing tax credits.
The Pittsburg City Commission on Feb. 25 approved a recommendation from the Economic Development Advisory Committee to commit a below-market loan of $170,000 at 1 percent interest to a proposed 42-unit multifamily development to be built adjacent to the Community Health Center of Southeast Kansas.
Developer Vecino Group and project partner Building Health Inc. presented the proposal to commissioners, describing a 42-unit building with 29 one-bedroom and 13 two-bedroom units. Project leaders said 12 of the units would be set aside for people exiting homelessness and would receive on-site supportive services provided by Building Health and local partners.
Becky Gray, executive director of Building Health Inc., said Building Health will be a 51 percent owner of the entity that will hold the development if the low-income housing tax credit (LIHTC) application succeeds. Heather Bradley Geary, Vecino Groups director of supportive housing, said Vecino has applied for 9 percent LIHTC through the Kansas Housing Resources Corporation (KHRC) and was invited to submit a full application in May; awards are expected in August.
Project financing shown to the commission included federal and state tax credits, a National Housing Trust Fund request of $1,000,000, HOME dollars from KHRC (listed as $500,000 on the presentation), the construction loan (estimated at about $8,000,000), and the citys proposed revolving loan fund assistance. Vecino representatives said they reduced their original request to the city from $300,000 to $170,000 to improve competitiveness in the KHRC scoring process.
Vecino representatives described proposed rents aligned with HUD AMI bands: the LIHTC maximum rent at 30 percent AMI for a one-bedroom was cited as $465 and two-bedroom $558; Vecino said its proposed rents would be roughly 10 percent below those caps. Commissioners pressed for clarity on vouchers and supportive housing operations; KHRC application materials and coordination with the Public Housing Authority were discussed on the record.
City staff and the EDAC recommended approval of the $170,000 loan at 1 percent, amortized over 20 years with a seven-year term. The commission approved the commitment by voice vote; staff clarified the loan is a contingent commitment and funds would only be disbursed if other funding sources listed in the project application are secured.
Speakers on the record included Heather Bradley Geary (Vecino Group), David Allison (Vecino Group), Becky Gray (Building Health Inc.), and City Manager Blake (presenting the EDAC recommendation).
