Council tables developer assistance request for 401 Lincoln Street after debate over TIF and demolition aid

Councilors approved a site plan and the rezoning needed for a proposed 16-unit workforce housing development at 401 Lincoln Street, but they tabled consideration of additional city financial assistance after an extended discussion about tax-increment financing (TIF) terms and demolition costs.

Developer West Shelton told the council he purchased the former Johnson school in 2021 and demolished the building, saying demolition and remediation costs exceeded $60,000. Shelton presented a proposal for a roughly $2 million single-story building with 12 one-bedroom and four two-bedroom units and estimated the redevelopment would increase the property’s annual taxable value from about $160 to an estimated $22,000–$24,000 once leased. "This is going to be a 16-unit apartment building... designed specifically for workforce," Shelton said.

The council first approved a site plan, with staff and the developer describing alley access, replacement sidewalks, and existing water and sewer connections. A councilor had noted a discrepancy in the parking count shown on the plan (21 stalls shown vs. the asserted requirement of 24); Shelton said he could reconfigure stalls to meet the required count. The site plan vote passed with the members present.

Discussion then shifted to Shelton’s request for assistance with demolition costs and a potential TIF package. Shelton said earlier conversations with city leadership discussed options that included more generous terms—examples cited in the discussion included 100% rebate for 15 years in other communities—but the city’s historic practice, several councilors said, has been 85% rebate for 10 years. "We have never gone above 85% and we have also never done above 10 years," one councilor said, urging consistency with precedent to avoid creating expectations for future applicants.

Council members repeatedly raised fairness and fiscal concerns: with state funding declines and limited local revenue, several said it would be imprudent to award a more generous deal to a single developer. Others acknowledged higher construction costs and noted longer TIF terms are used elsewhere to make projects feasible. Councilors also advised Shelton to re-run the project numbers under the city’s usual 85%/10-year framework and to investigate external grant possibilities for remediation or brownfield funding. On asbestos and related mitigation costs, Shelton said inspections revealed more extensive abatement than expected, increasing demolition expenses.

After extended back-and-forth and a request that the developer "crunch the numbers" and return with revised financials, a councilor moved to table further action on assistance; the motion was seconded and the council voted to table the item. Shelton thanked the council and said he would re-evaluate the project's pro forma.

Next steps: the zoning and site plan decisions stand for the project as approved; consideration of demolition reimbursement or atypical TIF terms was deferred pending additional financial detail from the developer and possible staff analysis.