New Market Tax Credits Key to City’s Revival

Cincinnati’s development coffers got a little fatter last week, as $125 million in federal tax subsidies flooded into the city. These subsidies, called New Market Tax Credits (NMTCs), incentivize local investors to funnel capital into low-income communities and have essentially bankrolled Over-the-Rhine’s entire revitalization.

For example, Washington Park — perhaps the most emblematic example of OTR’s rebirth — received nearly $14 million in New Market Tax Credits (NMTC) from the Local Initiatives Support Coalition (LISC) to help support its reconstruction. Several ongoing developments have also received some or all of their funding through NMTCs, including the Market Square and Ziegler Park projects.

Ziegler Park Aerial

New Market Tax Credits helped transform parts of Over-the-Rhine like the reconstruction of Ziegler Park (Photo by Travis Estell)

Developers often balk at the prospect of developing low-income communities because they fear their investment will be wasted. NMTC are the federal government’s attempts to allay these concerns. Congress first authorized the subsidies through the Community Renewal Tax Relief Act of 2000. Over the past fifteen years, the bill’s success has earned it bipartisan support. According to the program’s 2016 report, the tax credits have created 750,000 jobs and invested over $75 billion to businesses and revitalization projects in communities with high rates of poverty and unemployment.

Less than 25 percent of the applications submitted each year are awarded, but three major Cincinnati developers beat the odds this year: Cincinnati Development Fund ($65 million), Uptown Consortium (45 million), and the Kroger Community Development Entity ($15 million).

To win an NMTC grant, a corporation — in federal parlance, Community Development Entities (CDE) — must lobby the U.S. Treasury’s Community Development Financial Institution (CDFI) Fund on behalf of private investors like the Cincinnati Center City Development Corporation (3CDC). If the CDFI approves the application, then the investors who pledged money to the CDE will receive a seven-year tax abatement to support development.

3CDC, in particular, has secured a eye-popping $238 million since the program’s inception. Without this capital, it’s unlikely that OTR would have changed as drastically as it has. The community was a no-brainer for NMTC-driven development due to its extreme poverty. The neighborhood’s median household income during the 2010 census was a paltry $14,517. Six years and billions of dollars have certainly improved its lot, but its average income still pales in comparison to the city’s 2015 median income, $56,826.

While OTR will likely continue to receive the majority of NMTC-driven development, other distressed neighborhoods are receiving attention. According to Director of Development Thea Munchel, the Walnut Hills Redevelopment Foundation expects approximately $6.5 million in NMTC Equity for its expected revitalization of Paramount Square. “It is too early to know who all will participate in the deal,” she said. “But Cincinnati Development Fund received a huge award and has indicated that they will contribute some into the project.”

Cincinnati Rent Data Reveals Housing Challenges

Renting an apartment in Cincinnati is comparable in price to most of the geographically close and similar-sized cities in the Industrial Midwest and Upper South regions. Apartment-finding website RentCafé investigated the average apartment size and rent in America’s 100 largest cities. Using a baseline of $1,500, the data provides a glimpse America’s most and least-expensive cities.

Cincinnati’s price per square foot comes out to be exactly $1.00 and, with an average apartment size of 863 square feet, the average rent in the city is $866. Cincinnati is identical in price per square foot with St. Louis, MO, although a smaller average apartment size makes the average rent ($839) cheaper in that city. Cincinnati’s average rent is less than in Pittsburgh, PA ($1,070) and Cleveland, OH ($927) but more expensive than Columbus ($800), Indianapolis ($758), and Louisville ($841). Besides Indianapolis and Pittsburgh, most nearby cities remained relatively similar in average rent prices.

rentanalysisohio

RentCafé’s data also shows, unsurprisingly, that New York City, San Francisco, and Boston top the list with average rents coming out to $4,031, $3,275, and $3,111, respectively. Using the baseline of $1,500, you could afford a 271 square foot apartment in New York City, a 342 square foot one in San Francisco, or an apartment with 399 square feet in Boston. Other cities at the top of the list include other expected cities such as Washington, DC, Seattle, WA, and Los Angeles, CA. The cheapest cities for rent in the nation are Memphis, TN, Wichita KS, and Winston-Salem, NC.

Despite rent in Cincinnati and related cities being relatively cheap renters in these cities’ respective counties struggle to afford a decent apartment. Based on data from the National Low Income Housing Coalition (NLIHC), a typical renter household in Hamilton County, OH (Cincinnati) will spend 36.9% of their income to afford a two-bedroom apartment. The NLIHC considers anything more than 30% to be unaffordable. In Marion County, IN (Indianapolis) that number is 35.1%, in Jefferson County, KY (Louisville) it’s 35.5%, 33.9% in Allegheny County, PA (Pittsburgh), and 37.1% in Cuyahoga County, OH (Cleveland). Franklin County, OH (Columbus) comes close to being affordable at 30.4% and St. Louis County barely makes the cut at 29.7%.

While housing crises are well-documented and discussed in America’s booming cities like New York City and San Francisco, this data shows the need for more affordable housing in many of America’s smaller metropolises as well. In fact, looking at the data from the National Low Income Housing Coalition, one would be hard-pressed to find many major American cities that meet the 30% of income threshold set by the NLIHC.

PHOTOS: $30M Renovation of Historic YMCA Building Now Complete

Following a year-and-a-half renovation process, the historic Central Parkway YMCA reopened last month, and leaders at Episcopal Retirement Homes, the company overseeing the residential portion of the project, have recently welcomed the project’s first residents.

The $30 million project overhauled the entire 123,000-square-foot structure and was undertaken by Model Group. The upgraded YMCA includes a new saline lap pool, all new equipment, and expanded class offerings. Officials hope the renovated club attracts 1,600 members by the end of the year and eventually reaches 2,000 members.

The building’s upper six floors include 65 residences for seniors, providing much-needed affordable housing in the heart of the center city. A similar partnership has been tried before with the Parkview Place project in Anderson, Indiana, which also consists of affordable senior apartments located above an historic YMCA.

Nearby, scores of multi-million dollar development projects are underway that will add dozens of hotel rooms, hundreds of residents, and tens of thousands of square feet of commercial office and retail space. Such changes are expected to both raise rents and further increase the desirability of Over-the-Rhine, Downtown and the nearby West End neighborhood.

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DOTE Hosts Final Open House for Liberty Street Narrowing Alternatives

The City’s Department of Transportation and Engineering will present the final two design alternatives for consideration at its third public open house tomorrow night at the Woodward Theater. The study which began in 2013 as a Complete Streets initiative proposed by the OTR Brewery District Master Plan now lives on as a proposal to physically narrow the street by ten to twenty feet on the south side. The new land could potentially unlock development sites along the street.

In its original configuration Liberty Street was once the dividing line between unincorporated territory and the city of Cincinnati. It was a narrow street with enough room for parking and less than two full lanes for traffic. In 1959 the City began to demolish properties along the south end of the street to widen the street to seven vehicle lanes and two parking lanes. The once quiet side street became a thru-way for automobile traffic looking to connect to the interstates and Central Parkway.

As revitalization progresses in Over-the-Rhine renewed attention is being paid to the street. The narrowing is an attempt to stitch back the fabric of the north and south halves of the neighborhood. Because of its configuration it is difficult for pedestrians to cross the street in the provided amount of time and bicycling is unsafe due to the high volume and speeds of automobile traffic.

Initial configurations were many ranging from a restoration of the original street width to preserving the current set up. In between proposals called for a reduction to four or five lanes with bicycle lanes or rush hour traffic configurations. After two subsequent meetings the options are down to two: A five-lane and a six-lane configuration. Input taken from this open house will be used to narrow down to the final alternative. Once that alternative is selected it will be presented for adoption at the Over-the-Rhine Community Council in September.

The meeting is this Tuesday evening, 6PM at the Woodward Theater on Main Street in Over-the-Rhine. The Theater is accessible by the #17, #19 and #24 Metro bus routes, and is within 100 feet of a Cincy Red Bike Station located at Main Street and Orchard Street.

Hamilton Looking At Possibility of Developing Urban Trail on City’s West Side

The City of Hamilton is looking at the possibility of acquiring approximately 36.5 acres of land from CSX Corporation following its filing for abandonment of the former freight railroad. If city officials ultimately decide to proceed with the purchase, the plan will be to turn it into an urban bike and pedestrian trail on Hamilton’s inner west side.

Running from CSX’s main line in Millville to the former Champion Paper Mill, which is in the process of being redeveloped into a youth sports and entertainment complex, the property also includes a former railyard near the Great Miami River at Two Mile Creek.

Hamilton’s west side neighborhoods currently lack any protected bike lanes or off-street bike paths. As a result, the possibility of adding such an amenity has community leaders excited.

“The proposed Beltline trail will be of great value to our community,” said Hamilton Councilman Rob Wile. “By connecting these neighborhoods to our existing trail infrastructure we open up a number of convenient outdoor recreational opportunities to our residents.”

Earlier in the year city officials hosted public hearings to gather feedback on the concept, and are continuing to gather feedback through an online survey. The results, they say, will help determine whether they should ultimately pursue the project.

“The survey lets the City know what kind of benefits residents see in the trail, how often they may use it, what potential negative aspects or problems may occur with it; and is being used to see what generally the public thinks about the potential trail,” Nicholas Garuckas, City Management Fellow inside Hamilton’s Office of the City Manager, explained to UrbanCincy.

“The [survey] results are carefully being looked at and considered in helping determine whether or not the City should be moving forward with this project or not.

In the meantime, Garuckas says that City Hall is moving forward with an appraisal of the land’s value, along with assessing the possibility of various grants from agencies like the Ohio Public Works Clean Conservation Fund, Rails to Trails Conservancy, Dopplet Family Fund, Ohio Department of Natural Resources Clean Ohio Trail Fund, and Recreational Train Fund.

The project follows a pattern of other more marque urban trail projects around the country that are transforming former industrial rail corridors into park and recreation space for under-served urban communities.

Last June, Chicago celebrated the opening of its 2.7-mile trail called The 606. Atlanta, meanwhile, has been opening segments of its much larger 33-mile BeltLine project in phases over recent years. Nearby, in Cincinnati, city officials are poised to acquire an abandoned 7.6-mile freight rail line in its eastern neighborhoods for what is being called the Wasson Way project.

While smaller in scope, the approximately 2.7-mile Hamilton Beltline has, at least initially, has gained the support of Hamilton City Council, and is rooted in the city’s planning documents. In fact, city officials explain that the idea for the project came out of discussions about what to do with the Champion Paper Mill complex and surrounding areas.

“This project is part of the bike path master plan and it will be an asset to all those who enjoy the outdoors including walkers and joggers,” Wile concluded.

If Hamilton is successful in acquiring the land, it would add significant recreational facilities and new transportation options to the city’s west side. If abandonment proceedings continue without Hamilton moving to purchase the property, it will instead be sold off in piecemeal fashion to private owners.