Journal Express, Knoxville, IA

Local News

November 7, 2013

Council moves forward with housing projects

The Knoxville City Council took action Monday night to seek funding for housing rehabilitation and approved support for a new development.

After hearing from a third developer about a proposed housing development, the council voted to support a Section 42 housing application by Jim Bergman, who had addressed the council at a prior meeting. Bergman’s concept is for 52 new housing units of various sizes and style, including duplexes and quadplexes.

The Section 42 tax credit is similar to a lottery system, in which 30-40 proposals are received each year and approximately 13 are selected to receive the credit. If one of the proposals for Knoxville is selected, the City of Knoxville will have to provide a financial match, up to 6 percent, to the project. How much of an investment this would require, and where the money would come from is unknown. The council set aside $350,000 this fiscal year for housing development, which could be a source, but that has not been determined. To be selected, the housing must be affordable for low to middle income families. City Manager Harold Stewart said the proposals are not the usual low-income housing projects, rather they are aimed at families who may be starting out and cannot yet afford a home. People making a good wage could still qualify to live in the homes, but they could also be turned down for making too much money.

Stewart had good things to say about all three developers, all of whom were awarded Section 42 housing funds last year. As for why the council chose Bergman’s project, he believes it was because of the size and scope of the project.

“It was the biggest proposal,” Stewart said. Council also believed that having one strong application in to the program would make the City more competitive than if multiple efforts were backed. Most communities are fortunate to have a single developer interested in such housing projects, let alone three, Stewart added.

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