City Council OKs Abatements For Proposed Little Crow Lofts

Construction on converting the Little Crow manufacturing building to an apartment building in downtown Warsaw could begin as early as November.
During its meeting Monday night, the Warsaw Common Council heard an update on the Little Crow Lofts project before approving a 10-year tax abatement on real property improvements and a three-year tax abatement on the existing vacant facility.
City Planner Jeremy Skinner told the council the developer – The Commonwealth Companies – is estimating spending roughly $6.4 million to rehab the Little Crow building at 201 S. Detroit St. He said there will be 42 residential apartment units in it once it’s completed.
The three-year abatement is allowed by the state under the vacant building deduction, Skinner explained, which is an “additional tax abatement for the existing assessed value of the building that’s been vacant for two or more years.” The Little Crow building has been vacant for about four years. The tax abatement is for 100 percent the first year, and 50 percent for the second and third year, he said.
Skinner said these tax abatements, being downtown, weren’t necessarily based on job creation but rehab, reconstruction or reinvestment in facilities downtown. From that standpoint, Skinner said Commonwealth met the criteria for the 10-year tax abatement.
In his presentation, Commonwealth Vice President of Development Kevin McDonell said his company is an apartment developer from Wisconsin. It is a developer and general contractor.
In the Little Crow project, McDonell said Commonwealth will be performing all three duties, but like to identify as the general contractor in projects like this.
“General contractor does mean local construction jobs. We have in-house carpenters and painters, and that’s all we self-perform, so all the other trades, we’re looking to hire local – subcontractors to do the work,” McDonell stated.
Commonwealth focuses on historic preservation projects where it utilizes historic tax credits, as it will with the Little Crow facility.
He said they received approval from the state’s historic preservation office for its construction plan, which was the “biggest hurdle we had left.” The state now has forwarded that on to the National Park Service, which oversees the allocation of the historic tax credits. McDonnell said they should get a response back from the Park Service in about two weeks. Typically, McDonnell said the Park Service does follow suit of the state.
Of the 42 units in the Lofts, he said there will be seven one-bedroom units and 35 two-bedroom units.
“They’re going to be targeted as enterprise loft units to support and promote Warsaw’s work force and provide downtown housing that we don’t see currently existing in the marketplace,” he said.
McDonell said they have a “unique” partnership with OrthoWorx to provide educational events for the Lofts’ residents, as well as community citizens, to talk about the orthopedic industry and to promote other entrepreneurial-type educational opportunities.
The Lofts will have a community room, an exercise room, a billiards room and an on-site property management office. There will be a property manager and maintenance staff.
McDonell said by the end of this week, Commonwealth will be submitting its formal plans to the state for its approval. He said they typically get those approved within 30 days.
“So we’re looking to start construction early in November, certainly before the end of November,” he said.
In response to a council question, McDonnell said the building will look “similar” to the way it currently does, but cleaned up and with some new windows, especially on the east side. The southernmost portion of the building will be re-exposed so that the metal structure is coming down to show the historic brick. The metal structures on top of the building will be removed.
Councilman Ron Shoemaker asked if they had any issues with the railroad. McDonell responded they are working with the railroad, have gotten to an agreement, but are waiting to see the lease. The railroad has approved the plans.
The Lofts will have parking to the north and on the southern side of the building where the metal is being taken down.
Skinner said the city’s review committee has gone through the site plan and it’s passed.
Mayor Joe Thallemer said the Little Crow building was one of the city’s original Stellar Communities projects.
“We’re very excited that Kevin and his group stepped forward and applied for those tax credits,” Thallemer said. “I’ll just tell you that Kevin’s projects scored the highest when he was going after the grant. And I think that says something about their company as well.”
The council approved both of the tax abatements as requested.
Also on the council’s agenda was the municipal sewage works and stormwater utility financial management reports for review.
Thallemer said the cash position is good and the rate sufficiency meets the current guidelines. However, he said on page five of the report there is some discussion on projects, planned capital improvements and expansion, that the city recently discovered with the aging infrastructure. He said there are studies being done and meetings going on about the extent of those projects.
“At that point, there probably will be some discussion of a rate increase, which we actually haven’t had in the last eight years,” he said.
The rates are fine right now, Thallemer stated. “As these necessary projects become identified, we can get a better idea on the costs and we’ll have to sit down and look at the costs,” he said.
The mayor asked the council to study the reports for discussion at a later time.
A public hearing was held on the 2017 budget, which totals over $24 million, with no public comments. It was approved on first reading, with the second reading scheduled for Oct. 17.
In other business, the council approved:
• A revision to a resolution it passed Sept. 6 for the Parks & Recreation Department to seek a $500,000 grant from the Office of Community and Rural Affairs for two parks on East Market Street. The revision adds the specific amounts for matching grant dollars.
• The 2017 general salary and fire territory salary ordinances on first reading. The state requires they be approved by Nov. 3.
The elected officials salary ordinance was tabled as it doesn’t need approved until Dec. 31.
• A transfer of $2,200 from Oakwood Cemetery’s salaries and wages account into its professional services account to pay part-time help for leaf season.
• A transfer of $20,000 from the Building & Planning Department’s salaries account to professional services. Skinner said with all the projects the city did this year, he needs some more funds in that account.
• A transfer of $34,000 from the street department’s salary and wages account into the street professional services for the hiring of the fall leaf crew.
• On first reading an amendment to the employee personnel policy handbook for emergency city closings. The second reading will be Oct. 17.