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Council backs major downtown housing project with TIF and state bond support
Summary
The Rochester City Council and its EDA approved development assistance agreements and authorized combining tax increment financing and DMC resources to support a 341-unit downtown project that includes a 76-unit affordable senior building, drawing debate over public subsidy and timing.
Rochester — The City Council on June 16 approved a package of actions to advance a major downtown housing development that pairs market-rate construction with a deeper-affordability building aimed at seniors.
The Rochester Economic Development Authority and council approved purchase-and-development assistance agreements and authorized use of up to $500,000 in General State Infrastructure Aid (GSIA) and a performance-based tax increment financing (TIF) structure to support the Civic Center North project, which Sherman Associates proposes to build on the city-owned civic parking lot. Developer Sherman Associates and partners described a two-building scheme totaling 341 units, including a 76-unit affordable, age-restricted building averaging 50% area median income (AMI) and rent/income restrictions for at least 30 years.
City staff and developer representatives said the financing stack combines tax-exempt multifamily revenue bonds, Low Income Housing Tax Credits and TIF to bridge a gap that the affordable portion alone could not cover. "But for the market-rate component, we wouldn't be able to support the affordable housing gap," a city official told the council. Sherman Associates said the project will deliver a riverfront walkway extension and structured parking that screens service areas from downtown.
Why it matters: The package is intended to produce significant new housing supply downtown while delivering deeper-affordability units not otherwise viable without subsidy. Council supporters cited the public benefit of adding housing near transit and civic assets; critics cautioned about long TIF terms and the size of public assistance for a private development.
Key details and votes: The council and RDA adopted the agreements and findings required for the project; the development assistance agreement contemplates a TIF district (District 82) sized and timed to repay the city’s obligations if increment materializes. Staff noted the affordable building must remain affordable under program rules for decades, and that TIF payments are performance-based (paid from new taxes generated by the project). The council vote on the package carried with a majority; one councilor recorded a dissent on grounds of subsidy scale.
What’s next: With council and RDA approvals in place, the developer will move into final financing and permitting. City staff said some of the public support—bond issuance and any GSIA—must meet state deadlines and program requirements; the affordable building’s funding package is scheduled to close this summer. The city emphasized that TIF and other public funding are subject to the project producing the projected increment and to the legal and timing constraints of the bond programs.
