The Great Bend City Council Monday night approved a Rural Housing Incentive District (RHID) resolution and an industrial revenue bond (IRB) resolution for the $6 million loft project in the historic Zarah Hotel.
The first resolution makes certain findings and determinations as to the need for housing within the city and sets forth the legal description the property proposed to be designated as a RHID, said Dominic Eck, the city’s bond counsel with the firm Gilmore and Bell of Wichita. The second is determining the advisability of issuing taxable industrial revenue bonds for the purpose of financing the acquisition, construction, renovation, furnishing, and equipping of a multi-family housing facility.
As for the first, the approval was the first step, Eck said. Now, the Kansas secretary of commerce must approve it, and the city has to hold a public hearing and then approve an ordinance establishing the RHID.
What the RHID does is it captures the incremental increase in (property taxes) to pay off the infrastructure costs. This can be used to help with the renovations of historic properties, such as the Zarah, he said.
With the IRB, the project developers, in the this case Mytown, will receive a sales tax exemption during the construction of the project, Eck said. After completion, the bonds would be issued and Mytown would be responsible for paying for them.
The effort advanced in April with the state approval of a $1.425 million Moderate Income Housing Grant from the Kansas Housing Resource Corporation, said Justin Pregnont. Working with Mytown and GMLV Architects of Wichita, he is the owner of Pomeroy Development, an Atchison-based firm that specializes in renovating historic properties.
The council applied for the grant on behalf of Great Bend Economic Development Inc. This marked the third time GBED tried for the funding after being turned down in September 2021 and August 2022.
GBED sought the funds to build affordable housing in the Zarah, located at Main and Lakin. The building is owned by the MyTown organization and this is its project, GBED is merely helping facilitate it.
Mytown, an organization striving to fill downtown store fronts, has owned the Zarah since 2008.
The Lofts at the Zarah will include some studio apartments renting for around $800 per month, one-bedroom apartments renting for around $1,000 and two-bedroom apartments renting for around $1,200.
If all goes well, the hope is to complete the work by the end of 2024 or early 2025.
These new homes have to be considered affordable, meaning the tenants can’t be rent-burdened (the rent can’t be greater than 30% of their income as tracked by the KHRC).
Although most of the units will be “rent restricted,” there may be a couple available to tenants who exceed the income guidelines.
