Near North affordable housing project in Ann Arbor moving forward with brownfield plan

Approval of the plan allows Avalon Housing to seek Michigan Business Tax Brownfield Redevelopment Credits from the state, said Michael Appel, executive director of Avalon Housing.

City officials said the brownfield plan doesn't include any tax-increment financing and would not reduce the amount of taxes received by any local taxing jurisdictions or public schools.

The City Council approved the 39-unit Near North Apartments Planned Unit Development last September and a payment-in-lieu-of-taxes for the project in October.

With approval of the brownfield plan from the City Council, the Washtenaw County Brownfield Redevelopment Authority now will consider the plan on June 10, and the Washtenaw County Board of Commissioners review will begin July 7.

Approval is required by the county and the state.

Avalon, a nonprofit housing corporation, is developing Near North with its for-profit partner, Three Oaks, as a mixed-use development. It will provide 25 affordable apartments to households with low incomes and 14 supportive housing apartments with project-based Section 8 rent subsidies.

The project consists of a 65,144-square-foot, mixed-use building with 39 residential units, 2,714 square feet of retail, and 1,553 square feet of office use.

The project was identified as potentially eligible for brownfield financial incentives after a finding that the property contained benzo(a)pyrene, arsenic, lead, barium, chromium, copper, mercury, selenium, silver and zinc in the soil exceeding the generic residential cleanup criteria under state regulations known as Part 201.

In a separate unanimous vote on Monday, the City Council amended the development agreement for the Near North PUD to make sure the developer follows through on cleaning up the soils.

Appel said Avalon Housing is hoping to break ground in early fall.

"We are waiting to hear from the Michigan State Housing Development Authority about tax credits, which are the key financing proposal for us," he said. "And they said they were going to announce in mid-May and here we are in early June, but we're optimistic. We think we score pretty well. We have investors lined up, and we're hopeful that we'll be able to have some good news real soon."

Local funding approved so far includes $500,000 in Washtenaw County HOME Funds and $500,000 from the Ann Arbor Downtown Development Authority.

"We're excited that despite what's pretty rocky time in Michigan for doing low-income housing development, it looks like Near North is going to move forward," Appel said. "But we still need to hear about the funding."