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Council reviews proposal to convert Thorstenson LTDA to 25 income‑targeted units under LIHTC
Summary
Staff recommended allowing a developer to amend the 2015 LTDA to deliver 25 LIHTC income‑targeted units instead of 30 market‑rate units, saying the developer lacks a feasible path to deliver the original market units and that LIHTC conversion would stabilize the vacant Thorstenson building and bring modest tax and economic benefits.
Eric Gibson presented data and a staff recommendation asking the council to approve an amendment to the 2015 Land Transfer and Development Agreement that would permit the Thorstenson building to be redeveloped as 25 income‑targeted units under the Low‑Income Housing Tax Credit (LIHTC) model rather than the 30 market‑rate units originally contemplated. "Once again, the decision before the council is to approve or disapprove a contract amendment that would allow the development of 25 income targeted units in lieu of the 30 market rate units that were agreed to in that 2015 LTDA document," he said.
Gibson summarized the developer’s argument that the original market‑rate plan is not currently financially feasible; staff said denying the amendment could leave the building vacant for the foreseeable future. Gibson cited an estimated $20,000–$25,000 in additional annual property tax revenue if the LIHTC option proceeds (figure provided to staff by the developer, Lotus) and estimated approximately $500,000 per year in additional discretionary spending in the local economy from the 25 occupied units.
Jeremy, the neighborhood development director, explained subsidized housing types and LIHTC mechanics and showed that about 82% of county subsidized units are located in Ogden City. He also presented occupancy and pipeline data (occupancy >90% for subsidized units; CoStar pipeline numbers: roughly 313 market‑rate deliveries in the next 12 months with 97 subsidized units under construction).
Council members raised a range of concerns: that Ogden bears a disproportionate share of county subsidized housing, whether LIHTC units would hollow out occupancy in other subsidized properties, and how new market‑rate development nearby might affect downtown property values and the city tax base. The transcript records a council member saying the city ‘‘keeps on piling on when the other cities in our county are not doing much,’’ and staff replied that high LIHTC demand makes vacancy displacement unlikely and that denser development typically yields higher revenue per acre.
Staff said LIHTC compliance periods (15 years, often renewed) make an LIHTC conversion likely to remain income‑restricted for a prolonged period, and again recommended approval based on contractual history and market analysis. The work session did not record a formal council vote on the amendment; staff framed the recommendation for the council’s forthcoming decision.
Next steps were not voted during the session; council members continued discussion and requested further details about regional housing distribution and pipeline timing.
