They’re hoping at least some commissioners have changed their minds since the proposal failed to pass in February.
At the the board’s regular meeting Friday, Chair Robert Williams said the U.S. Department of Housing and Urban Development pre-approved the authority’s application for a Housing Assistance Payment contract contingent on the authorization of tax increment financing, or TIF, to buy the building.
In February, county commissioners split 7-7 on the $4.6 million funding plan and a proposal to increase the downtown TIF district’s debt ceiling, dealing a setback to the authority’s intention to buy the apartment building, move its residents to a new complex and sell the prominent downtown building to a commercial developer.
The authority still needs approval from HUD to take over the subsidized rent contracts of the Sevier Center’s current residents, and listed TIF dollars as its source of funding to buy the building. Williams said that’s still the authority’s plan, but the contract could be modified should the county not approve the proposed use of TIF.
“Ideally, this was a project that was made for TIF, quite frankly, so that’s our Plan A, is to try to go back to the county,” Williams said. “I feel like we’ve addressed the concerns that commissioners had.”
Johnson City Commissioner Joe Wise, also a member of the JCDA board, worried that taking the time to again take the proposal to the county could sour the seller, East Tennessee Limited Partnership.
“My concern is this is a transformational project, and we need to stop driving this car like grandma going to church and start driving it like it’s a race, because it is a race,” Wise, also a former county commissioner, said. “I’m very fearful of losing that contract because of diddling around with it.”
Wise said he fears another buyer would not share the JCDA board’s interest in revitalizing downtown and would instead leave the building in its current state of disrepair, hurting the city’s redevelopment efforts.
He advocated seeking a traditional bank loan to buy the property, the payments for which would be covered by the income from the tenants. With the purchase out of the way, Wise said he believed the redevelopment plan would be less complex and more palatable to county commissioners.
County Commissioners Freddie Malone and Jodi Jones, who represent the county on JCDA’s board, shared Williams’ optimism, and said coming back to the commission with the HUD pre-approval in hand may help change some commissioners’ minds.
“My impression is there are at least the two, maybe three that want to vote in a positive way for the project, but they want to feel good that it will be a successful project,” Malone said.
Williams added that he and the authority’s staff are in close contact with the sellers and vowed that the board would move quickly to secure traditional financing should it appear another buyer was moving in.
“We’re not going to let that happen,” he said. “Being good stewards, we feel like the first ask should be the TIF, because that’s what it’s in place for and it makes it a more simple transaction if it’s TIF on the front end. If it doesn’t happen, we’ll move forward with traditional financing and we could come back at the TIF afterwards, but I think the preference is, if we can, to go that route first.”