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Bay View project prompts tax debate

Eric Wagner, part-owner of Cafe Centraal on Kinnickinnic Avenue, says he thinks the city should pursue a redevelopment plan for the vacant Army Reserve site that will generate higher property taxes. Photo by Corey Hengen

Eric Wagner, part-owner of Cafe Centraal on Kinnickinnic Avenue, says he thinks the city should pursue a redevelopment plan for the vacant Army Reserve site that will generate higher property taxes. Photo by Corey Hengen

Sean Ryan
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Bay View residents are worried a proposed development with housing for low-income seniors will not generate as much in property taxes as other ideas for the 5.6-acre property.

The Housing Authority of the City of Milwaukee wants to build the senior-living apartments as well as town houses and single-family homes on the vacant Army Reserve site in Bay View. The Milwaukee Department of City Development picked the authority’s plan for the northeast corner of Logan Avenue and Conway Street from seven proposals.

But there are not enough budget details available regarding the authority’s project or the other six proposals to nail down how much in property tax each would generate.

The authority’s development must receive tax credits to be successful, and projects using the credits generate less in property taxes than other developments, said Alderman Tony Zielinski.

“That’s going to be a key factor in this whole thing,” he said.

Eric Wagner, part-owner of Cafe Centraal on Kinnickinnic Avenue, said he is astounded Milwaukee did not pursue a development that would generate more in taxes, particularly considering the city’s tight budgets.

“Clearly, we would like the city to take another look at this massive opportunity,” he said at a project hearing Tuesday.

But Andrea Rowe Richards, Milwaukee DCD communications manager, said tax generation only was one factor by which a panel of judges, including three Bay View residents, ranked the projects.

“We’re not just judging this based on the proposed increase of the tax base solely,” she said.

The other factors include the price offered for the Army Reserve land, developer experience, the possibility of getting the money to make the project happen, the effect on the surrounding neighborhood and whether the development meets a requirement to generate its own electricity, Rowe Richards said. The authority’s proposal has more housing units than the six others and, unlike some of the competition, will generate its own electricity, she said.

Allyson Nemec, principal designer at Quorum Architects Inc., Milwaukee, said the site would generate its own electricity with 75,000 square feet of solar panels.

Warren Jones, managing director of development for the housing authority, said the agency plans to apply this year for tax credits from the Wisconsin Housing and Economic Development Authority.

State rules require properties that receive tax credits to be assessed according to the amount of income they generate through their tenants, Jones said. It is meant to prevent high property taxes from hurting an affordable-housing development’s ability to charge below-market rents, he said.

However, the proposed development’s town houses and homes would be sold at market rate, and one-third of the senior apartments would be rented at market rate, Jones said. So the taxes paid by those market-rate units would be the same as any other development, he said.

If the housing authority’s project is rejected, Milwaukee DCD must go back and negotiate with the other developers, Rowe Richards said, and revealing the details of their project plans could influence that competition.

The city received proposals from Sherman & Associates, Minneapolis; HD Development LLC, Milwaukee; Direct Current, Milwaukee; Traditional Neighborhood Design, North Carolina; New Land Enterprises LLC, Milwaukee; and Vetter Denk Properties LLC, Milwaukee.

“We try to share what we can with the public without compromising the (request for proposals) process,” Rowe Richards said.

Zielinski said he will consider the residents’ concerns and will not rush to make a recommendation to the Common Council. If the majority of the area residents come out against the development plan, he said, he will ask the city to step back and look at other proposals.

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