Council committee backs pilot tax‑payment agreement and creation of an affordable housing fund for Heritage Trails project

City staff and a developer detailed a plan the Community Investment Committee recommended to the full council Tuesday that would let a developer pay a fixed, stepped annual payment to the city instead of the normal property tax bill while dedicating those receipts to a new affordable housing fund.

The committee accepted a substitute ordinance authorizing a 15‑year pilot agreement for the 180‑unit Heritage Trails project and voted to send the item to the Committee of the Whole with a favorable recommendation (roll call: 5 ayes, 1 abstain). The committee also voted 6‑0 to send a companion resolution that would establish the city’s affordable housing fund.

City staff described the structure as similar to a tax abatement but with a critical difference: the pilot fixes what the property owner will pay each year. “In year one of this pilot program, they would pay $36,000 in taxes, and then every year they’ll pay 3% more,” a Community Investment presenter told the committee. Staff said the owner has agreed to the schedule and the receipts must be dedicated to the newly established affordable housing fund.

Staff said the estimate of the project’s full tax liability after construction is roughly $330,000 per year; the pilot structure produces an estimated $4.6 million in tax savings over 15 years that the city is treating as the city’s support of the project. The project was awarded low‑income housing tax credits in November 2025, officials said.

Developer representatives told the committee the project will deliver 100% of units at or below 60% of area median income, include amenities such as a clubhouse, pool and bike racks, and incorporate a 100% rooftop-and‑carport solar installation so residents would have a single rent payment that covers utilities. “This deal was awarded in November 2025. It’s a 180‑unit, family workforce housing project, all at that 60% AMI level,” the developer said.

Committee members pressed on affordability and operations: a slide shown during the presentation listed an example two‑bed, two‑bath rent at about $1,188 per month, and a council member described that level as “a little steep” for affordable housing. Staff and the developer said that advertised rent includes utilities and that the developer carries a roughly $200,000 annual operating and maintenance budget plus reserves.

Staff said the city is not providing a direct grant or TIF for the project; instead, the pilot agreement and an SDC waiver (estimated at about $270,000) are the forms of city support. The affordable housing fund — created by resolution — will be administered by the Department of Community Investment and limited by state law to qualifying affordable housing activities, staff said.

Next steps: both measures now go to the full council for consideration and final action at an evening session. The committee record shows no public speakers in favor or opposition during the committee public hearing.

The committee’s recommendations do not finalize the agreement; if the council approves the pilot and the fund, staff will finalize the pilot agreement and the city will record the form of the agreement required by the ordinance.