Douglas County agrees to join 15‑year, 95% tax rebate for Nindale Lofts 2 affordable housing in Lawrence

The Douglas County Board of Commissioners voted 5–0 July 16 to participate in a 15‑year Neighborhood Revitalization Area (NRA) that would rebate 95% of the incremental property tax increase generated by the Nindale Lofts 2 project at 716 East Ninth Street in Lawrence.

Brandon McGuire, assistant city manager for the City of Lawrence, said the project developer (Tony Kresnick) is applying for a 9% federal Low Income Housing Tax Credit (LIHTC) award with state matching credits from the Kansas Housing Resources Corporation. McGuire said the proposal includes 24 affordable one‑bedroom units targeted at 30%, 40% and 60% of area median income, 12 market‑rate units and six live‑work ground‑floor units. He told the board the city supports the project as part of its affordable housing goals.

Tom Calico of Baker Tilly Municipal Advisors outlined the NRA mechanics and fiscal assumptions. He explained that the NRA is a state statutory rebate program that establishes a base assessed value for the property; 95% of the difference between tax revenue on the base and the tax revenue on the new assessed value would be eligible for rebate over 15 years. Calico said the school district’s capital levy is excluded from rebate calculations and that the county appraiser administers annual calculations and disbursements.

Calico described the project as an approximately $14 million development with a 30‑year affordability requirement for the LIHTC units and eligibility for Section 8. He said the city had provided $450,000 from its affordable housing trust fund and the project sought additional incentives including a sales tax exemption on construction materials through issuance of industrial revenue bonds. Calico said the developer’s pro forma had been reviewed for reasonableness, and Baker Tilly judged the 95%/15‑year request to be reasonable for filling the financing gap.

The county appraiser explained that, under state law, tax‑exemptions and LIHTC restrictions require valuation based on actual cash flows; affordable rents produce a lower assessed value than market‑rate peers, and assessments are revalued if the project later exits the affordability restrictions.

Fiscal modeling presented in the staff packet estimated a present‑value benefit to the county of roughly $43,000 without the project and about $107,000 with the project (present‑valued over the 15‑year term), meaning the county’s net present‑value tax receipts would increase under the proposal despite the rebate. The cooperative agreement authorizes the county appraiser to perform annual administration and allows the county to collect a $1,000 annual administrative fee for handling calculations and distributions.

Commissioners asked for more documentation on how the 95% and 15‑year terms were chosen and requested that the city provide more transparent line‑by‑line impacts for taxing jurisdictions when the city returns with additional approvals. The commission approved a motion authorizing the county administrator to execute a cooperative agreement with the City of Lawrence and USD 497 for administration of the NRA and to participate in the 15‑year, 95% rebate.

The city will finalize its NRA ordinance and related approvals; the county’s participation is voluntary and implemented only through a cooperative agreement recorded between the taxing jurisdictions.