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Bluffdale RDA hears $5M-plus request for Centrum apartments, asks staff to draft participation contract
Summary
Developers requested just over $5 million in RDA support for a 308-unit Centrum apartment at Port Rockwell and 146 South, including a $3.4M net-present-value tax-increment ask and $1.8M pre-performance grant; the board asked staff to draft a participation agreement and return with options.
Jake, presenting to the Redevelopment Agency board, asked the agency for “a little over $5,000,000 in RDA funds” to support the Centrum project at Port Rockwell and 146 South and described the developer’s offer to deed-restrict 10% of units at 80% of area median income for 20 years.
The project, as presented, would deliver 308 units (about 24% studios, 46% one-bedroom and 30% two-bedroom units) with amenities including a pool, fitness rooms, theater, and pickleball courts. The presenter said comparable market rents average a little over $2,200 per month and that, using assumed growth rates (5% market, 3.6% subsidized), the cumulative lost rent from deed-restricting units over the development period and 20 years would be roughly $8.7 million; discounted at an 8% rate, that stream produces about $3.4 million in net present value, which the developer asked the RDA to treat as tax-increment assistance. Separately the developer requested a $1.8 million pre-performance grant to help cover permit and impact fees and urged that staged payments be tied to construction milestones and certificate of occupancy.
Board members and staff probed the assumptions and the policy fit. Staff said the request could be structured from two RDA sources: (1) the municipality’s general tax-increment incentive funds and (2) the RDA’s 20% ‘‘moderate-income housing’’ set-aside (referred to in discussion as the Olene Walker set-aside). Staff and the board discussed remaining balances in the set-aside, the six-year commitment timing on those funds, and the question of whether the $1.8 million up-front grant is essential to make the project financeable. Staff noted sensitivity options (tying the pre-performance amount to interest-rate movements or staging payments to reduce upfront exposure) and explained that moving the tax-increment payments earlier in the project life would reduce the present-value amount the developer requests.
No contract or vote was taken. After extended discussion about the RDA’s goals, remaining moderate-income housing funds and the merits of keeping dollars local, the board directed staff to draft a participation contract that lays out options (different mixes of pre- and post-performance payments, conditions tied to financing costs, monitoring/reporting requirements, and exact language for the deed restriction) and return to the board for review and decision.
What happens next: staff will prepare a draft participation contract and additional financial options for the board to vet at a future RDA meeting; board members asked for clearer numbers on available set-aside balances, timing constraints and alternative incentive structures before authorizing any award.
