Athens City Council on Monday voted unanimously to approve amending the terms of legislation that entered the city into an agreement with a private developer to construct close to 50 single-family townhouses inside the University Estates subdivision, raising the market price per home by $20,000 because of pandemic-related supply constraints on building materials.
The move by Council assures that construction will move forward on property owned by Albany-based Cornerstone Home Builders in the far West Side subdivision, though the developer must first get home designs approved by the city.
Each unit will be sold at a base price no higher than $240,000 as requested by the developer, up from the $220,000 that the city originally agreed to. Although, potential home buyers could opt to purchase more expensive features for their unit, such as premium countertops, raising the base price.
The price hike is the result of severe shortages in essential building materials such as lumber, which has raised the cost of constructing homes across the country by tens of thousands of dollars per unit, according to CNBC.
The agreement is a product of the city’s Affordable Housing Commission, which identified in recent years the need for expanded owner-occupied housing in the city that is affordable for young professionals, The NEWS previously reported.
Each new home will be financed solely by the developer — not the city or taxpayers.
The city’s role in the agreement is to create a tax increment financing fund (TIF) to collect 75 percent of the increased property valuation of the land for 10 years after the homes are built. The money collected from the TIF would be used by the city to pay the developer to service a bond to finance roads and other infrastructure needed for the homes.
Previously, the price hike had troubled Councilmembers Beth Clodfelter and Jeffrey Risner, who were concerned that the new cost would be out of reach for the Affordable Housing Commission’s target demographics.
Councilmember Sarah Grace, however, maintained during Monday’s meeting that homes were never intended to be billed as “affordable,” despite being recommended by the Affordable Housing Commission. The purpose was to instead construct two and three-bedroom homes that incorporate principles of “universal design,” made to accommodate several demographics including those who are elderly or disabled, according to the amendment.
“Just because the affordable housing commission recommends proceeding with a project, does not automatically mean that project is identified specifically as affordable housing,” she said. “It means the affordable housing commission has very carefully reviewed the identified housing needs of the city and has carefully reviewed the planned project and has decided that this project helps us to meet our housing needs.”
Risner, who previously signaled he would oppose the price hike, ultimately voted in favor of it, saying in an interview Grace and Councilmember Chris Fahl sold him over the past several weeks on the project’s merits and the inescapable realities of supply constraints on building materials.
“Our housing stock in Athens is pretty bad right now in terms of the number of available units. It’s definitely a seller’s market right now and there just isn’t a lot of choice out there,” he said of his decision to support the amendment.
Clodfelter, who voted for the measure, said in an interview she was also swayed by Grace and Fahl. Clodfelter noted she was misinformed about the project’s purpose in the past when she questioned the affordability of each home.
“It also wasn’t clear to me at that point that nobody was calling this particular housing development an affordable one. I think there was confusion because it was the affordable housing commission that proposed it, but they were never calling this one affordable,” she said.