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Council OKs 15‑year PILOT for a 180‑unit low‑income housing project; establishes affordable housing fund
Summary
Council approved a 15‑year payment‑in‑lieu‑of‑taxes (PILOT) agreement with Heritage Trails Southbend LP for a 180‑unit low‑income housing project and simultaneously established a city Affordable Housing Fund to receive pilot payments. City officials said pilot payments will be deposited into the fund and used only for eligible affordable housing purposes.
The Common Council voted unanimously to authorize a 15‑year payment‑in‑lieu‑of‑taxes (PILOT) agreement with Heritage Trails Southbend LP to support a 180‑unit low‑income housing project on the city’s south side.
Eric Lavich, director of Growth and Opportunity, told council the pilot is the city’s mechanism to set a fixed payment schedule rather than an uncertain tax abatement. Under the proposal, the developer—identified in the meeting as Burgeon Held/Heritage Trails LP and represented by Cole Caress—would make annual pilot payments directly to the city over 15 years; those funds must be deposited into an affordable housing fund established under state code.
Caress described the development as a roughly $50 million, 180‑unit family project awarded 4% low‑income housing tax credits. He said the project includes a roughly $5.2 million solar installation on rooftops and carports designed to eliminate the project’s electric load, and that the owner will provide free Wi‑Fi and utilities assistance to residents. The developer indicated construction was expected to start after a May 2026 closing with an approximate 18‑month build schedule.
Council members pressed staff on long‑term affordability and the tool’s future use. Lavich said the city will record a 40‑year land‑use agreement to preserve affordability, while the pilot itself runs 15 years; after the 15‑year pilot the developer could pursue re‑syndication to extend affordability. On process, staff said pilot agreements are attractive because they align with IHCDA timelines and provide certain, negotiated payments that the state requires be deposited into an affordable housing fund.
Council also passed a separate resolution creating the Affordable Housing Fund to receive pilot payments and spend them on eligible activities for households at or below 80% AMI, including resident support, technical assistance, developer incentives or infrastructure work. The council voted 9–0 to pass the ordinance authorizing the pilot and to adopt the fund resolution.
Next steps: City staff said they will finalize the pilot agreement as an exhibit to the ordinance, record required documents with county offices and begin the administrative steps to receive pilot payments once the project is operational.
