photo by: Douglas County GIS/Journal-World

The blue star shows the site of a proposed 250-unit affordable housing complex in south Lawrence.

A new 250-unit affordable housing complex may be coming to Lawrence, and it may land in a neighborhood known for a different aspect of affordability. Plans call for the project to be built near the discount retailers of south Lawrence.

The project is still in its early stages, but Manhattan-based Bison Development LLC has filed preliminary paperwork at City Hall in hopes of moving the project forward. The apartment complex — which would be rent-controlled — would be built at 3100 Michigan St. Despite the address, that is a vacant lot that primarily faces 31st Street. It is basically across the street and a bit east of the Menards home improvement store.

The paperwork filed for the project is a request for a sales tax exemption on the purchase of construction materials for the apartment complex. Normally that request comes as a project is nearing construction, but in this case it appears to be coming at the beginning. The apartment project proposes to uses state-issued low-income housing tax credits to help finance the project.

Those tax credits are awarded by the Kansas Housing Resources Corporation through a competitive process. More projects normally apply than what the state can provide credits for. Having a local government supporting the project through an approved sales tax exemption generally strengthens the project’s application.

All that is to say that the project doesn’t seem to have its financing fully in place, so whether it comes to fruition is still a bit unclear. I’ve got a call into a representative with the development group to learn more, but haven’t yet heard back.

Nonetheless, the prospect of such a project is still significant. The idea of 250 rent-controlled housing units being built in Lawrence all at once is a significant prospect on Lawrence’s affordable housing scene.

According to the plans filed with City Hall, the project would have a strong focus on family-style housing. The apartment complex would feature 63 three-bedroom units. It also would have a mix of one-bedroom and two-bedroom units, plus would include a central fitness facility, community center and swimming pool.

The site is within walking distance of lots of shopping, several health care offices, banks, restaurants and public transit stops.

“Situated in an amenity rich location near shopping, transportation, and recreation, the site provides an ideal location for families and seniors,” Bryan Elsey, owner of Bison Development said in a letter that was part of the city’s application process.

This is the second time in the last year that Elsey has tried to build an affordable housing project in Lawrence. Elsey was part of the Manhattan-based group that sought to rezone property on East 15th Street.

Lawrence-Douglas County planning commissioners in October rejected that rezoning request for a 500-unit apartment complex on vacant land at 2111 E. 15th St. One of the reasons that project was rejected was due to its distance from shopping, schools and other amenities.

The south Lawrence location is quite a bit different in regard to what’s available. But one of the biggest differences between the two sites is that the 3100 Michigan St. property already is zoned for apartment development.

Now, it seems the key factor in whether the south Lawrence project will move forward is whether it can win the state tax credits. Developers in their application to the city said those tax credits were critical to their financing plan. The good news for the project is that state officials have awarded those same types of credits — 4% low income housing tax credits, if you are keeping track at home — to another south Lawrence project not long ago.

In 2021, the state awarded the tax credits to Union at the Loop, a 248-unit affordable housing complex at the intersection of Michigan Street and the South Lawrence Trafficway. That project basically is a block south of the proposed project.

The tax credits give developers a valuable asset to sell to investors who are looking to lower their tax liabilities. Developers are hoping to receive and then sell $45 million in tax credits to help fund the approximately $70 million project.

But the tax credits come with an important string attached; any project that uses them must agree to limit its rents to certain levels so that lower income residents can afford the apartment units.

In this project’s case, the rents must be affordable for residents who have incomes that are 50% to 70% of the average median income in the area.

Lawrence city commissioners will have one item related to the proposed project on their agenda for Tuesday’s meeting. Commissioners are being asked to formally receive the project’s application for a sales tax exemption, which would come through the issuance of Industrial Revenue Bonds. Per the city’s policy, such requests first must receive a recommendation from the city’s Public Incentives Review Committee. Commissioners are expected to forward the application to that committee for review.