Council weighs using city parcels for small workforce housing; staff proposes restrictive covenants

City staff presented preliminary options for using public land to meet council goals for workforce and attainable housing. The Customs House parcel was presented as able to accommodate roughly 8–9 units (750–1,000 square feet each) if laid out to maximize density; staff used a $250-per-square-foot build assumption to estimate unit pricing in the neighborhood of $200,000 to $265,000 per unit.

Staff recommended restrictive covenants and qualified-income thresholds to preserve units for local workforce buyers or renters and suggested pursuing a request-for-proposals model to limit upfront city risk. Councilors debated the city’s role (developer versus enabler), the risk that units would not sell if the market softened, funding sources (system development charges, urban renewal) and the difficulty of long-term resale restrictions that permit modest equity growth while keeping prices in an attainable range. One councilor suggested outreach to local developers and housing-resource partners before hiring consultants; staff agreed to convene stakeholder feedback and return with options.

Councilors also discussed alternative land parcels (a Tapiola Park remnant and a site near Florence Street), potential infrastructure impacts (moving an 8-inch sewer line and considerations for a 36-inch sewer lobe), and the possibility of rental models with nonprofit partners if council preferred a rental focus. Staff said no final decisions were made and that next steps include developer outreach and stakeholder meetings.