Ames City Council moves forward with affordable housing, pledges more money for fewer units

Danielle Gehr
Ames Tribune
Ames City Council members listen during a council meeting Jan. 11 in Ames.

The Bakers Subdivision is moving forward with uncertainty as the City of Ames pursues a lower tax credit, pledges more money and aims to break ground this year.

Ames hired Prairie Fire Development in October 2020 to pursue affordable housing at 321 State Ave. but recently hit a roadblock after missing out on the 9% low-income housing tax credit. 

The council voted Tuesday to pursue a 4% low-income housing tax credit program now and commit $1.8 million in HOME funds to the project, avoiding another delay — though the October goal to break ground is not a guarantee. 

"There's a lot of places where it could fall apart, but the first step is we need a developer's agreement that says they are going to commit to doing this," housing director Kelly Diekmann said. "I feel like we are committing to option one because it's the quickest option. If they're not willing to commit to that, I think it's a different evaluation of the idea and the project."

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The project will be reduced from 37 to 30 housing units, eliminating one of the buildings from the layout. Unlike the previous proposal, which would have included five market-rate units, all 30 units will be affordable housing. 

"I think we are moving in the wrong direction in terms of density," councilmember Tim Gartin said. 

Gartin was the one dissenting vote Tuesday and said the proposal before them was far inferior to the original opportunity the city had at 321 State Ave. When the council selected Prairie Fire in October 2020, Gartin pushed for a 50-unit proposal instead. 

Seventy percent of the original project would have been funded through the tax credit program. Now 60% would be funded through the city and 40% from tax credits. 

The other option presented to the council Tuesday was to pursue the 9% low-income housing tax credit again, which would extend the timeline by at least another year. With the 4% tax credit, there are still roadblocks to breaking ground this year.

The developer still must design a new site plan. The city does not yet have the $1.8 million it is committing to the project. And an updated cost estimate has not been completed. 

"It's a tenuous partnership where we're both taking risk," Diekmann said. "More so them because they're spending money." 

Diekmann said if this option does fall apart before October, the city will have ample time to prepare for the next round of tax-credit applications in the spring. 

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Future indoor aquatic center to be named after Ames family 

After pledging $3 million to Ames' future indoor aquatics center, Mary and Rich Fitch will be the new namesake of the facility, which will be called the "Fitch Family Indoor Aquatic Center."

The council voted Tuesday to approve the name, as well as names for other parts of the facility honoring donors to the estimated $31.2 million project. 

To recognize a $500,000 pledge from Fareway Stores, the zero-depth entry pool and play structure will be named the "Fareway Fun Zone." The therapeutic pool will be named the "Mary Greeley Medical Center Therapeutic Pool" to honor the hospital's $4 million pledge. 

"We are very, very appreciative of these three donors," parks and recreation director Keith Abraham said. 

Dan Culhane, president and CEO of the Ames Chamber of Commerce, spearheaded fundraising that resulted in more than $8 million in donations. Staff is also looking into finding a way to honor the memory of Geitel Winakor, who donated $2 million to the project. 

Development of needed industrial lots moves forward 

The council voted to move forward with an agreement that will bring much-needed industrial lots to Ames after an appropriations clause caused the developer some hesitancy last month. 

Chuck Winkleblack of Hunziker and Associates said he was uncomfortable with a clause that said the tax-increment funding incentivizing the small industrial lot infrastructure development needed yearly council approval. 

He feared a future council could reverse the agreement. Though the clause was necessary so the maximum rebate of $2.6 million would not be considered debt, the council decided to remove the clause Tuesday. 

In July, the council discussed a "very limited" supply of small industrial lots in the one- to three-acre range. Agribusiness magnate Roger Underwood and Winkleblack proposed at the time the city use tax-increment financing, or TIF, agreements, a reimbursement of taxes to businesses or developers, to attract them to Ames. 

After the city created the TIF program, Winkleblack applied with a project to bring 13 industrial lots to Dayton Avenue, just north of 13th Street. 

Diekmann said a developer agreement will be deferred to later this summer. 

Danielle Gehr is a politics and government reporter for the Ames Tribune. She can be reached by email at dgehr@gannett.com, phone at (515) 663-6925 or on Twitter at @Dani_Gehr.