City Approves Development Agreement for Ponderosa Affordable Housing Project
July 6, 2023
The City Council of West Des Moines has approved a Development Agreement for the Ponderosa Affordable Housing Project, marking a significant step towards addressing the growing need for affordable senior rental housing in the community. The agreement, entered into between POMP of West Des Moines, LLC, and the City, aims to facilitate the construction of approximately 156 affordable senior rental housing units.
Under the Development Agreement, POMP of West Des Moines, LLC will receive financial assistance of $125,000 per unit, totaling $19.5 million, to support the construction of the housing units. The City will create a pay-as-you-go Tax Increment Financing (TIF) district, wherein POMP of West Des Moines, LLC will receive property tax rebates based on the increment generated by the currently undeveloped areas of the Ponderosa development. However, the property tax rebates will be capped at $125,000 per unit, ensuring that the developer does not receive rebates beyond this limit.
The Development Agreement also establishes an Economic Development Urban Renewal Area (URA) for the project, allowing the TIF district to run for 20 years instead of the usual 10 years for a Housing TIF. This approach, utilizing the income approach to project valuation, will enable the Ponderosa Affordable Housing Project to contribute to the economic development of the area while addressing the critical need for affordable senior housing.
The Ponderosa Affordable Housing Project was met with support from the Finance & Administration City Council Subcommittee during its presentation on February 22, 2023. Following the Council Subcommittee’s endorsement of the project and proposed subsidies, the City Council directed staff to initiate the process of approving the development agreement and creating the Ponderosa Urban Renewal Plan and Area.
With the Development Agreement approved, the City of West Des Moines is one step closer to realizing the vision of the Ponderosa Affordable Housing Project. The initiative aligns with the City’s commitment to fostering inclusive and sustainable communities, ensuring that residents of all ages have access to safe and affordable housing options.