Seward City Council members on Dec. 16 approved the first application for Tax Increment Financing in the swath of Seward they designated Redevelopment Area 3 in August.
The project approved will be a fourplex at 428 N. Third St. where an older structure with five apartments burned in 2022 and was later torn down. The owners, Peery Housing, said on their application the two-bedroom apartments would bring the property’s estimated assessed valuation to $525,043 for tax purposes in the spring of 2027 compared to the current lot value of $22,557.
Construction will begin this spring.
TIF, for which the city offers financing funds, would be a $108,770 loan. The difference between the current annual taxes and the annual taxes that are expected to be $7,251 after construction are then applied to repay the loan for up to 15 years.
Mark Peery, one of the housing partnership owners, briefed council members on the plans, which cater to young professionals and young families with one of the four units complying with Americans with Disabilities Act (ADA) criteria for accessibility.
Off-street parking is included in the plan with five diagonal public street parking spaces to be developed in addition to five spaces on the property accessed by the alley.
The Peery application indicated the property will provide workforce housing and affordable rents, two housing priorities noted in the county’s last housing study.
While no one appeared to oppose the financing at the public hearing, council members deliberated the precedent this application could set for other properties in the 116-lot Redevelopment Area 3.
Mayor Josh Eickmeier noted that the city’s previous redevelopment areas have been in less residential areas. The first area included the Seward Rail Campus and nearby properties along Highway 15, though some of those designations were to be removed earlier this year.
The city also designated a 167-acre section of town that includes much of the Seward business district between the Blue River and Bradford Streets for redevelopment.
Nebraska statutes allow first class cities to designate up to 35% of their property as blighted and dilapidated.
City Council Member Karl Miller, the only council member to vote against the TIF project, questioned its use in a situation where the property owners had an empty lot, asking if the city is guaranteeing profit or helping with exorbitant costs.
“Would this project happen but for TIF financing happening?” Miller asked.
But Mayor Josh Eickmeier noted that in filling the vacant lot with housing fits with TIF intent in Seward.
He said the city wants to invest in areas where they can get “more bang for the buck” and had not used TIF for residential buildings before.
Council member Zane Francescato said TIF is 16% of the project.
“Realistically this is an ideal project for TIF. In 15 years we will recoup that back when TIF expires,” he said.
Andrew Willis, an attorney who assists the city with TIF projects, said the project meets the city’s building codes and requirements for seeking this financing.
Willis told the council that cities handle TIF differently and noted that South Sioux City is providing TIF financing for single-family housing.
“There’s a lot of communities doing a lot of different things,” Willis said.
Eickmeier said the city is aware of the precedent it may be setting with the Peery project and he appreciated the discussion at the council meeting.
“Once you start heading down this path it will be harder and harder to say no,” he said.
Peery Housing is planning a structure that is appropriate for the neighborhood and increases housing options in Seward, he said.
“At the end of the day it is going to make that area better.”
The designation for Redevelopment Area 3 was based on dilapidation shown by 18% of the structures in the area that were badly worn or worn out, deterioration based on sidewalk and street conditions or the lack of sidewalks, an average structure age of 91 years, and conditions that endanger life or property, which again noted the area’s sidewalks and streets.
Such designation is required for TIF considerations.
Five Rule Rural Planning completed the study in August for the area bordered by Lincoln Street on the north, Roberts Street on the south, North 10th Street on the west, and North Third Street on the east, but excludes the block between Roberts and Moffitt Streets from North Fifth Street to Highway 15 and the southern half of the block between Highway 15 and North Seventh Street north of Roberts Street.
The excluded areas near downtown are in the second redevelopment area.
The study was initiated based on the Peery Housing plans on Third Street and interest expressed in possible TIF financing to the city by Concorde Apartments between Moffitt and Lincoln Streets on North 10th Street, which has a quarter of a city block that is undeveloped.
Before taking action on TIF financing at the meeting, the council changed Seward’s Unified Land Development Ordinance reducing minimum lot sizes for properties zoned R-3 mixed density, R-4 multi-family and UC-urban corridor.
City Building and Zoning Director Tim Dworak said when reviewing the ordinance for the TIF application, staff members realized a large number of existing multi-family use lots did not comply with current size regulations.
That is an issue, Dworak said, because should a property be damaged, noncompliance with the lot size could make rebuilding impossible.
The change approved drops the minimum site area for multi-family developments to 4,500 square feet, which is down from 9,500 but still larger than the 4,400 or 3,000 square feet requirements for other residential properties.
On another zoning matter, the council was presented a request to rezone a property on River Street from R-4 multifamily to I-1 limited industrial uses, but the matter was dropped without a motion for or against the request.
Dworak said he received calls opposing the change, the owner would not be living on site, and it would require the city to “spot zone” in the area, which it works to avoid.
The Seward Planning Commission voted 7-1 to recommend the city council deny the request, Dworak said.
In other action on Dec. 16, the council:
• pproved rezoning a 6.68-acre property at 2909 Waverly Road RR-rural residential from AG-Agriculture following a public hearing at which no one spoke.
• ezoned 18 acres of property south of Rumery Lawn and Landscape from AG-agricultural to C2-highway commercial district to allow the business to expand.
• pproved a liquor license for Seward Petroleum LLC doing business as NP Mart 34 at 541 Jackson St. and recommended Anne Gordon as manager of a Class D liquor license for the business.
• pproved a poisonous and flammable gases storage permit for fuel tanks at Summit Contracting Shop on Izaak Walton Road.
• assed a $10,507 claim for property damage filed by St. Gregory the Great Catholic Seminary on to the city’s insurance and legal advisors.
• pproved a work order increase of $105,044 for the Worthman Boulevard extension project.
• dded $26,085 to an agreement with HDR, Inc. for services at the Seward levee interior pump station project.
• pproved preliminary plans, specifications and estimates for the Nebraska Department of Roads’ Plum Creek Bridge project.
• reated a city staff title of seasonal groundman.
• pproved an extension to the interlocal agreement for cooperative public safety software, hardware and related services, which is hosted by Seward County.
• oted Seward city offices will be closed Dec. 25 and 26.
