Council directs staff to prepare updated agreement for First & Pine affordable ownership townhomes

On Nov. 3 the Ellensburg City Council directed staff to prepare a revised affordable housing agreement for a reformulated proposal for the First & Pine site, asking staff to negotiate details of covenant language, presale requirements and assignment/continuity from the previously selected proposer.

Housing Program Manager Lily Fry introduced the revised submittal. Skyler Bissom Rapp, representing Manastash Architecture/Planning & Development and joined by TM Construction and Homesite (a community development financial institution), described a new "simple townhomes" ownership model intended to deliver 16 or 17 for-sale units. Presenters said the change followed underwriting and lender constraints on the prior design, which relied on owner-occupied rental income for underwriting; lenders and state programs created a "catch-22" that undermined the earlier financing approach.

Under the revised model, units would be sold to owner-occupants with conventional 30-year mortgages administered or supported by Homesite; down-payment assistance would combine state Commerce housing trust DPA (3% deferred, potentially up to $45,000 case-by-case), HomeSight Project Reinvest (0% deferred), a Bridal Communities Assistance Corporation construction-loan LOI (with $15,000 DPA), and Homekey Opportunity funding. Developers estimated a one-bedroom model could target a sale price near $256,000 with a presale-driven construction financing model. The proposal included a 51-year affordability covenant requiring resale to income-qualified buyers (80% AMI) and contingency language for foreclosure or nonprofit acquisition if needed.

Several members of the public raised process and financing concerns: a resident asked that mortgage products be fixed-rate, and another raised fairness questions about continuing the project with a reformulated team rather than reissuing an RFP. City legal staff noted the surplus-land enabling legislation gives council discretion and said the current proposal could be characterized as a continuation of the previously selected project; the Affordable Housing Commission had recommended the updated approach.

Councilmember motioned to direct staff to prepare an updated affordable housing agreement for the revised proposal and the motion passed. Council asked staff to work with the applicants to finalize the covenant language, presale and performance milestones, and other transactional details.