Agency defends housing grants

The seven-story structure was starkly modern, with a facade of metal and concrete.

Architect Mike Patano thought the minimalist design of The Lofts condo tower would suit Coeur d’Alene’s changing skyline. When they looked at the drawings, however, the Lake City Development Corp.’s board members had another view: too brash, too Seattle. They preferred brick – a better match, they felt, for Sherman Avenue’s historic character.

Patano agreed to a brick facade. The agency agreed to split the cost, pledging $190,000 for the upgrade.

The facade has become fodder for critics of Coeur d’Alene’s urban renewal agency. It’s on their shortlist of objectionable funding.

The Lofts are luxury units, priced from $650,000 to $1.3 million for penthouses with sweeping views of Tubbs Hill, St. Thomas Church and tugboats on Lake Coeur d’Alene.

Why, critics ask, should tax dollars subsidize the brick work? Or contribute toward the cost of a wrought iron fence at the Ice Plant Townhouses near Sanders Beach?

“If someone can afford a million-dollar condo, don’t you think that fellow can afford to pay for his own infrastructure?” said Dan Gookin, an outspoken urban renewal critic.

The debate is part of a larger discussion about downtown housing subsidies. Four years ago, a consultant recommended more housing units downtown. Adding a residential component strengthens inner-city retail districts by creating a ready customer base. As a result, the Lake City Development Corp. has channeled $2 million into downtown housing. Many of the units that received funding, however, are priced far beyond the reach of ordinary citizens.

“A unit in McEuen Terrace, a $13 million office-condo tower, is currently advertised for $895,000.

“Prices for the Ice Plant Townhouses, an $8.3 million project currently under construction, range from $279,000 to $439,000.

“The Parkside, a $55 million retail-office-condo tower also under construction, will feature units starting at $427,500 and ranging up to $2.5 million for penthouses.

“If it was for low-income housing, which we have a lack of, I could understand that,” said Duane Rasmussen, a local attorney. “But even $300,000 is not the average cost of a house here.”

In California, 20 percent of urban renewal funds are designated for low-income housing. Gary Edwards, who runs Fresh Start, a homeless advocacy group in Coeur d’Alene, would like to see a similar requirement here. A few of his clients lost rental units when older homes were razed to make way for new development downtown, he said.

“Some of that money from higher property taxes should be set aside for the people being displaced by these slum clearances,” Edwards said.

Charlie Nipp, chairman of the Lake City Development Corp., defends the subsidies, crediting them with jump-starting new residential construction downtown. In each case, the public money involved was a fraction of the project’s overall cost, he said.

Some of the most criticized expenditures were added to make the housing developments more attractive to the public, said Tony Berns, the Lake City Development Corp.’s executive director. He hears complaints about the $70,000 the agency contributed to the cost of the wrought iron fence at the Ice Plant. The project was initially submitted without the fence, but board members thought it helped the townhouses blend into the older neighborhood around it, softening the impact of denser development, Berns said.

Not all of the $2 million went into high-end housing either, other board members noted. The agency also put money into a couple of apartment buildings, and gave a grant to the more modestly priced Indiana Arms condominiums.

Affordable housing is the agency’s next priority, Nipp said. Last year, Lake City Development helped pay for a $45,000 study of Coeur d’Alene’s housing needs. It will guide the agency going forward, he said.

The debate over The Lofts’ brick façade isn’t the kind of publicity that Patano and his business partner, contractor Mike Dodge, envisioned for their project.

“We have this love and passion for downtown,” Dodge said, “so it’s hard to be embroiled in a controversy at this level.”

Two years ago, Patano and Dodge renovated the 1910 building housing Figpickels Toy Emporium on Sherman Avenue, adding a residence above the retail space. They could see an emerging market for downtown living, particularly among empty-nesters.

But developing downtown is expensive, Patano said. Land costs are higher. Developers also have to figure in the extra expense of razing old buildings and adding parking garages. Those costs ultimately lead to higher-priced units, Patano said.

The public doesn’t always understand how “thin and risky” the projects are, said Monte Miller, a partner in Miller Stauffer Architects, which developed both The Parkside and McEuen Terrace.

The Parkside had been on the drawing board since 1993, Miller said. It probably wouldn’t be under construction now without an $820,000 pledge from the Lake City Development Corp., which helped the developers relocate the Social Security Administration office, he said.

“The view by the public is that developers have unlimited funds,” Patano said. “Neither Mike nor I have deep pockets.”

That’s why The Loft’s original façade featured the lower cost steel-and-concrete design. When the Lake City Development Corp. reviewed the design and preferred brick, “we tried to be a good neighbor, but we couldn’t do it by ourselves,” Patano said.

The contribution for the brick is part of a $405,000 urban renewal package for the $8.9 million condo tower. The package also includes money for demolition and site remediation.

But the developers don’t get the $405,000 upfront. They’ll be reimbursed over time from the property taxes paid by The Lofts’ condo owners.

“It doesn’t do anything for us unless we’re successful,” Dodge said.