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Topeka council waives utility fees for two LIHTC applications to boost affordable housing bids
Summary
On May 5 the council approved two ordinances to waive up to $40,000 each in utility connection fees to help two proposed projects (34 and 42 units) receive scoring points for the 9% low-income housing tax credit process. The actions prompted public concern about using readiness‑to‑serve/base utility funds to support fee waivers.
The Topeka Governing Body approved two home‑rule ordinances on May 5 to waive specified utility system and connection fees — $40,000 per project — for two proposed affordable developments seeking 9% low-income housing tax credits (LIHTC).
Leah Bowling, the city’s director of economic development, told the council the waivers are part of the 2026 Qualified Allocation Plan scoring approach administered by KHRC and would provide applicants with five additional points that can be pivotal in a competitive 9% tax‑credit round. “The applicant is applying for a low income housing tax credit 9% application through KHRC,” Bowling said. “A fee waiver is part of the 2026 QAP to provide the applicant eligibility for 5 additional points on their LIHTC application.”
The first ordinance (action item 5B) covers a 34‑unit project at 2800 Northwest Rochester proposed by DW Development Group LLC; staff said the project would be subject to a land‑use restriction for 30 years and the city would still collect roughly $26,780 in remaining fees if the $40,000 waiver were approved. The ordinance passed: the clerk recorded nine yes votes and Mayor Spencer L Duncan abstained to avoid taking a position on the record for that vote.
The second ordinance (action item 5C) would waive the same level of fees ($40,000) for Peaks of Topeka LLC, a proposed 42‑unit development estimated at $12.49 million that staff said would likewise include a 30‑year affordability covenant and a 100% income‑restricted unit mix at 30%–60% AMI. Mike Grube of MG Real Estate, representing the developer, told the council all 42 units would be income‑restricted and estimated rents for 30% AMI units in the low $400s: “All 42 units will be income restricted… Those 30% rents will be somewhere between $400 and $500 a month.” That ordinance passed 9–0 with the mayor not voting on the item.
Public commenters raised objections focused on the source of the waiver funds. Pat Delap argued the waivers are effectively paid from the utilities readiness‑to‑serve (RTS)/base‑charge fund and urged greater transparency and a forensic review: “I cannot fully support it… the source of funding. Well, it's coming from the water department,” Delap said, urging caution given utility budget stresses and customer hardship.
Staff responded that the waiver amounts are explicit in the ordinance ($40,000) and that the developers and affiliated entities had been verified as active and in good standing with the state and without outstanding code or utility fines. Developers and staff emphasized the LIHTC application deadline (May 15) and the competitive nature of point scoring that drove the compressed timeline.
What happens next: With the ordinances approved, each project can record the waiver in its application materials for KHRC scoring. Staff said they will continue due‑diligence and that any developer receiving awards will be subject to required affordability covenants and follow‑up conditions.
