Council directs staff to draft amended ground lease for S4 Flats workforce housing

The Town of Jackson on Feb. 17 directed staff to draft a second amendment to the ground lease for the S4 Flats affordable workforce housing development in Midtown, moving forward after months of design revisions and schedule delays.

Housing Director April Norton told the council staff recommended amendments “to revise the unit mix, revise the restriction type, revise parking, and include a binding project timeline,” citing a roughly 16% increase in total project costs since 2022 and a set of design changes that reduced total bedrooms while increasing the unit count to 13.

Developers said the redesign was driven by site constraints and the failure of automated parking stackers. "We do have a final design and a final budget that is viable," Joe of Figure 9 said during the presentation, adding the team considers the project “shovel ready.” Staff emphasized the town is not being asked for additional funding; the public contribution remains the same, staff said.

Councilors raised concerns about affordability and livability. "There’s something in economics called the sunk cost fallacy," Councilor Schechter said, warning against letting prior investments alone determine the decision. Other councilors pressed whether the project’s shift toward predominantly one-bedroom units would serve employee demand and whether storage and livability met community needs.

The motion, moved by Councilor Regan and seconded by Councilor Beaman, directed staff to draft an amendment that: revises the unit mix to nine one-bedroom and four two-bedroom condominium homes (13 total); revises restriction types to a mix of affordable ownership, workforce ownership and workforce rental deed restrictions; provides 14 parking spaces; and includes a project timeline with milestones, deadlines and default-and-cure provisions. The council voted unanimously to direct staff to prepare the amendment.

Key details in the staff report: the developer fee remains $250,000; staff listed the town’s net financial position to the developer as negative roughly $195,000 to date; unit and bedroom counts changed (13 units, 17 bedrooms in the proposed design versus about 12 units and 20 bedrooms earlier); and an unmet housing-needs grant application of $1.2 million could reimburse the town for the purchase of one lot if awarded. Staff noted the project had proceeded directly to building permit because 100% deed-restricted projects are exempt from planning commission review.

The council’s direction does not itself approve changes to deed restrictions or commit the town to new funding; it asks staff to prepare the formal amended ground lease with enforceable milestones for future council consideration.