Council once again seeks to develop city-owned property into affordable housing

Asheville City Council has once again revised a proposal to sell city-owned property at 360 Hilliard Avenue for development as affordable mixed-income housing. Council will vote on whether to repeal and replace an existing agreement with Kassinger Development Group during its meeting Tuesday, June 11.

A 2016 press release from the city notes that a plan for converting the property was first proposed during an October 2014 work session. Council agreed that redeveloping the Parks Maintenance Facility, located at 360 Hillard Avenue, would be Asheville’s first attempt at repurposing city-owned property for affordable housing. The city originally required that 51% of the development be affordable to households earning 80% or less of area median income — with 20% affordable to households at 60% or less of AMI — and that it remain affordable for at least 20 years.

In September 2016, Council entered into a contract for 360 Hilliard with the Wilmington-based development group Tribute Companies, but the agreement fell through. The city then contracted with the Kassinger Development Group, which has offices based in Asheville, in June 2017; Council agreed to a 50-year lease of the property for a 64-unit rental development including 33 affordable apartments. During negotiations with the city, however, construction costs gradually climbed to the point that Kassinger representatives called the apartment plan “infeasible.”

In November 2018, the city reworked the plans by changing the development from rental apartments to for-sale condominiums that would still meet the desired affordability levels. Council approved the revision unanimously, and construction was set to begin in February 2019 — until city staff struggled to legally guarantee the permanent affordability of the units. Kassinger also experienced difficulty securing a loan under the project’s for-sale framework.  

The fourth and latest iteration of the contract restores the development to a rent-based model and would include 86 units, 18 of which will be available at 60% AMI and 16 at 80% AMI for a 50-year period. Kassinger plans to buy the 1.75 acre property from the city for a total price of $475,000, below the market value of the land, and is requesting both a $1.4 million Housing Trust Fund Loan and a Land Use Incentive Policy grant. The development company will also pay to install a trailhead and about 400 feet of the Bacoate Branch Greenway, as well as share half of the city’s costs for a public parking lot. If the project is approved, construction would be set to begin in late summer.

In other business

Despite public pressure to amend Asheville’s fiscal year 2019-20 budget to provide additional funding for transit, tree protection and city employee wage increases — among other requests — Council plans to adopt the proposed budget without any changes to operations spending from its first presentation on May 28. The capital budget was updated, however, to include an additional up to $1.5 million that the Civic Center Capital Fund will receive over the next 12-18 months from the new Harrah’s Cherokee naming rights agreement.

Consent agenda

Council’s consent agenda for the meeting contains 12 items, which will be approved as a package unless singled out for separate discussion. Highlights include:

• A resolution authorizing the City Manager to direct staff to prepare and submit an application to the Federal Highway Administration for Riverside Cemetery to be designated under Activity Category A land use. The designation would identify the property as a place where serenity and quiet are of extraordinary significance and limit potential noise that would come from the Interstate 26 Connector, a project scheduled to begin in fall 2022. Only two locations nationwide have earned the designation.

• A resolution amending the City Council Rules and Procedures on Boards and Commissions to allow members of boards created by state law to serve more than two terms, at Council’s discretion, based on the level of desired board expertise and experience, matters pending before the board and whether additional terms would contribute to board stability and continuity. The current term limit is two successive terms of three years each.

• Amend the budget by moving $216,000 from the General Capital Projects Fund to the Transit Capital Projects Fund to pay for additional expenses related to the city’s new Proterra electric buses. Money is needed to purchase fareboxes and software — “because staff thought fareboxes from the old buses could be reused in the new buses,” according to a staff report available before the meeting — as well as vehicle registration fees, design/construction costs for charger installation, acceleration and brake pedal extenders and GPS trackers on all five buses.

• A resolution authorizing the City Manager to enter into a $2.9 million contract with Bryant’s Land and Development Services for the Phase 3 Bond Street Resurfacing Project that will resurface approximately 3.1 miles of city streets. The project includes Brooklyn Road, Cisco Road and Kenilworth Road.

Asheville City Council meets at 5 p.m. in council chambers on the second floor of City Hall at 70 Court Plaza, Asheville. The full meeting agenda and supporting documents can be found here.