By Lonnie Huhman,
A big step toward bringing affordable housing and a new food pantry location to Dexter was taken by the Dexter City Council on Jan. 28, as it unanimously approved a purchase agreement with Avalon Housing.
In her report to the council, city manager Courtney Nicholls said the city, “has been working with Avalon Housing and Faith in Action over the past two months to come to an arrangement on a purchase agreement for property located at 7651 Dan Hoey.”
“The purpose of the sale would be to facilitate Avalon’s construction of affordable housing and a permanent food pantry for Faith in Action,” Nicholls said.
In its project description, Avalon said it’s “planning to purchase approximately 2 acres at 7651 Dan Hoey Road in Dexter. We anticipate approximately twenty-four (24) units of affordable and supportive housing on-site including one-, two- and three-bedroom units in townhouses and up/down flats.”
Avalon Housing is an Ann Arbor-based organization that has built healthy, safe and inclusive supportive housing communities with 288 units in Washtenaw County and has previously partnered with Faith and Action and others to purchase and develop Sharon Ann Apartments in Chelsea as affordable housing.
“We anticipate approximately half of the units as supportive housing with vouchers through MSHDA- Michigan State Housing Development Authority,” Avalon said. “The remaining units would be rented to households under 50 percent or 60 percent of area median income. Additional funding is projected to include MSHDA Low Income Housing Tax Credits and a permanent loan, along with the Washtenaw County HOME funds currently being sought.”
Nicholls said the first milestone in this project is the application for the Washtenaw County Home Funds, which is due February 7, 2019.
“Avalon needs to demonstrate site control to gain the most amount of points on their application,” Nicholls said. “This is a significant source of potential revenue for the project-likely in the $300,000 to $400,000 range- and will be beneficial to show on the tax credit funding application that will be due in October 2019.”
The stated purchase price is $187,500.
With the purchase agreement adopted, Nicholls said, “Avalon will make application to the County for the Home Funds in February 2019.”
“The lot is currently being split into two parcels, which is necessary regardless of whether this project moves forward due to the sale of half the land to DTE,” Nicholls said. “If this project moves forward, Planning Commission will need to take action to rezone the property to Village Commercial. Avalon will then go through the site plan process with the goal of receiving approval prior to the October 2019 submission date for the tax credit application. At some point prior to closing, City Council will also need to hold a public hearing on the land sale in accordance with the City Charter.”
In the agreement, there is a “Buy Back Provision,” that states, “If after Closing, the Purchaser is unable to secure a construction loan to finance the improvements to the Property; to receive an allocation of the low income housing tax credits; or is otherwise unable to own, operate and manage an affordable residential rental development as contemplated in this Agreement, the Purchaser must offer to sell the Property to the Seller at the Purchase Price which Purchaser paid for the Property.