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Johnson County approves $1M loan for ‘workforce housing’ development in Shawnee

A Shawnee apartment complex that will accept rent-reducing housing vouchers crossed a final hurdle to construction Thursday when the county commission okayed a $1 million loan to the developer. Why

A Shawnee apartment complex that will accept rent-reducing housing vouchers crossed a final hurdle to construction Thursday when the county commission okayed a $1 million loan to the developer.

Why now? Developer Jason Swords had asked for the loan to cover the gap in financing caused by post-pandemic supply chain pressures and inflation of construction costs.

  • Swords already had Kansas Low Income Housing Tax Credits that would pay about 40 percent of the $30.5 million estimated project cost. The city of Shawnee last year approved tax incentives to exempt the sales tax on construction materials.
  • The loan is a non-interest-bearing mortgage lien, to be paid off in $10,000 annual payments over 14 years, with a balloon payment on the 15th year.
  • At the meeting Thursday, Swords told commissioners that the project could not go forward without the additional loan.

The bigger picture: The loan was hailed by some as at least a small step in addressing a shortage of affordable housing in Johnson County for first responders, teachers, restaurant workers and others who might not have the means to pay market rates.

  • But the idea also met with pushback from some members of the public.

‘A shakedown’: Several residents opposed to approving the loan shared their views at the commission meeting.

  • The idea that, “they can’t do it if they don’t get another million dollars of interest-free money – there’s a word for that. It’s called a shakedown,” said Maria Holiday of Overland Park, a real estate agent. She added that she is not against below-market rate housing but balked at the use of tax money: “I don’t want to pay for it.”

Other concerns: Others objected to various aspects of the design and its placement, like Abbie Rawie of the neighboring Crystal Place subdivision, who said she was disappointed in the process.

  • “I really don’t trust a developer that tells the Shawnee City Council and citizens that it’s for teachers, firemen and policemen. Let’s call it what it is – Section 8,” she said, referring to the former name of the low income tax credit program.
  • That echoed another woman’s concerns about the lack of a play area or green space for the children of the complex, and she also disliked the design of the clubhouse.
  • “To me that clubhouse looked very vanilla,” she said. “Our homes range from $400,000 to $650,000 a block away from this. I don’t want to drive by something that looks so vanilla.”

Affordable housing needs: But some speakers said the project would be a welcome help in addressing housing issues.

  • Jane Knoche, who also lives in the Crystal Place subdivision, said she has worked with the Johnson County Interfaith Hospitality Network, a group that assists people with housing needs.
  • “The more you can do as county commissioners to provide lower cost housing options, the easier it is for the situationally homeless to transition back to productive, tax-paying citizens,” she said. She urged adoption of the loan as a pilot program that could be expanded.

Homelessness prevention: Brian Hogan also read a statement of support from the Good Faith Network, an interfaith group addressing homelessness in Johnson County, among other issues.

  • “We see creation of affordable housing as a correct strategy for the prevention of homelessness,” he said. “We see this as an example of how Johnson County could come together to solve a problem that was made all so obvious in the recent housing study by United Community Services.”

At least on commissioner skeptical: Some other speakers joined Commissioner Charlotte O’Hara in her skepticism about the project.

  • A loan of this type would be new for the county and could start a bad precedent from other builders demanding similar treatment, she said.
  • “This is a Christmas tree that just never stops giving,” she said, adding she favors for-profit projects. “They already have a bag full of goodies and now they’re coming and asking for another million dollars. The sweet aroma of money, that’s all that I can smell.”

Developer defends project: Commissioners said comments they got since the plan came up as a potential agenda item last week indicated a lot of misinformation about the potential of a “slumlord” moving in using discounted materials for the building.

  • Swords said he plans to build a “class A” workforce housing complex with 144 units that meets Shawnee’s requirements for amenities including a swimming pool and gym.
  • He said the project was known among Shawnee council members: “There’s been zero point zero bait and switch. It’s been workforce housing from day one,” he said.

Commissioners in support: Commissioner Jeff Meyers, a former mayor of Shawnee, said the area has been zoned for apartments since 1999.

  • The plan meets a commission goal for affordable housing, is fully secured and an extremely low risk to the county, he said.
  • Commissioner Becky Fast disputed the idea that this loan will cause other builders to line up with hands out. Low income tax credits are extremely hard to get, often going to rural areas, she said. Last year only 12 projects in Kansas got them, and the year before that, only nine. “It could be another five years before Johnson County gets a low-interest tax credit project.”

How they voted: Ultimately, the loan was approved 5-2, with O’Hara and Commissioner Michael Ashcraft voting against.

Roxie Hammill is a freelance journalist who reports frequently for the Post and other Kansas City area publications. You can reach her at roxieham@gmail.com