Council OKs

TIF plan

development

Project is 56-unit

addition to

Ridgeway on German

By KREMENA TODOROVA

Journal Staff Writer

NEW ULM -- The City Council on Tuesday gave city staff the go-ahead to develop a tax increment financing plan for a new project, a 56-unit addition to an assisted-living facility on South German Street.

The Housing Alternatives Development Company (HADC), which owns the 52-unit existing facility in question, Ridgeway on German, is seeking some $450,000 in public assistance to build an addition to that project.

The existing units are all rented, and the facility enjoys a substantial waiting list, said manager Dean Bloemke, in a letter justifying his request for funding.

"It is the intention of HADC to expand 'the continuum of care'," said Bloemke. "We have proposed a 56 unit 'catered living' facility ... where 'housing with services' is an option within an apartment-like setting."

"It is our intention that most residents will be elderly, with all residents requiring some sort of assistance with daily living."

Bloemke said that the need for city assistance is fueled by "a strong desire" to "continue to serve" low-income residents.

The existing facility, Ridgeway on German, serves clients aged 31 to 100, of all income levels, according to company information. Of 52 rentals, 13 are receiving help from Medicaid programs. Approximately 75 percent are considered to be low-income.

Bloemke also said that the company is willing to accept "pay-as-you-go" TIF assistance.

The exact amount of the funding gap, and hence of the city involvement, will not be known until construction bids are received and a financial package is developed. However, the project is expected to total more than $4 million.

HADC would like to start building the project this fall and open it next spring, Bloemke also said.

In TIF projects, which are often undertaken to rehabilitate properties that have been off tax rolls for lengthy periods of time, local government recoups its investment by "capturing" increased taxes generated as a result of development.

In the case of Ridgeway on German, any funding would be granted based on the assumption that the project is fully taxable, said City Attorney Hugh Nierengarten.

The council's approval of a TIF analysis does not guarantee government funding for the project at this point. To authorize any assistance, the council would go through a decision-making process that involves several steps, including the signature of a development agreement.