Update: After nearly two hours in closed session Monday, Mayor Satya Rhodes-Conway said the Finance Committee gave "several specific instructions" to the negotiating team.
She said the instructions will be implemented over the coming weeks but did not elaborate. Negotiations are ongoing with Gebhardt Development.
Moving forward on the affordable housing portion of the Judge Doyle Square project in downtown Madison will require a decision that balances city costs, the number of affordable units and a desire to scatter the affordable units throughout the building.
The city is working with Gebhardt Development to bring affordable housing in a mixed-use tower above a new underground public parking structure that is nearing completion on the block behind the Madison Municipal Building.
Gebhardt’s proposal stood out from other applicants because it had the highest number of affordable housing units — 78 of 196 apartments would be reserved for residents making salaries at or below 60% of the county median income.
However, the city has strongly objected to Gebhardt’s plan to keep the affordable units separate from the mixed-rate units.
“This is very troubling to me. Extremely troubling. I understand the financial benefits to the city if we do it this way,” Ald. Donna Moreland, District 7, said at the July 8 Finance Committee meeting. “How will people be made to feel having to be on a separate floor where it’s known that these floors are segregated?”
In response to the city’s concerns, Gebhardt developed three options to disperse the affordable units throughout the building. However, the options present a trade-off between cost and the number of affordable units, according to a memo from the city’s negotiating team.
- Keeping the 78 units for those earning up to 60% of the county median income for a total city subsidy of $4.5 million.
- Dropping the number of units available for those earning up to 60% of the county median income to 40 for a total cost to the city of $2.45 million.
- Reducing the number of units, still available for those earning up to 60% of the median income, to 30 for a total cost to the city of $2.32 million. This option would make 16 units available each for those earning up to 70% and 80% of the county median income.
The Madison Finance Committee will discuss the options Monday at 4:30 p.m. in room 215 of the Madison Municipal Building, 215 Martin Luther King, Jr. Blvd.
Gebhardt’s original $52 million proposal called for a total of 196 total units and 26,000-square-feet of commercial space and amenities in a tower over the city’s new parking garage.
Stone House Development’s competing proposal called for a 159-unit apartment building and the Milwaukee-based Mandel Group proposed 150 units of housing.
To finance the project, Gebhardt had planned to seek a $1.75 million loan from the city’s Affordable Housing Fund and federal low-income housing tax credits through the Wisconsin Housing and Economic Development Authority (WHEDA).
The new options propose using 100% city subsidy to provide low-income units.
The block is half of a major development project downtown that spans two blocks known as Judge Doyle Square.
The city is working with Beitler Real Estate to develop the block where the Government East Garage currently stands. The garage is expected to be demolished in October, which will make way for a hotel and apartment complex.
Beitler was originally expected to develop both blocks, but the city took ownership of the municipal building block due to disagreements between the partners.