Having secured federal tax credits, a company with plans to refurbish downtown Bismarck’s Patterson Place affordable housing are seeking state and local tax exemptions to help with the cost of the project.
The Bismarck City Commission unanimously approved Schuett Development’s request for a five-year, full property tax exemption for the project at 420 E. Main Ave. Schuett Development also will seek final approval for a five-year state income tax exemption through the Renaissance Zone program.
The former Patterson Hotel became a section 8 senior affordable building with 117 units in 1982.
“The Patterson has not had a major capital infusion since 1982 and is in need of many repairs,” Schuett Development wrote in its application.
The company plans to invest nearly $7.2 million into the building. The estimated, five-year property tax benefit is $250,000.
Along with the federal Low Income Housing Tax Credits, Renaissance Zone tax benefits will offset a portion of the company's cost for replacing windows, repairing the roof, replacing boilers, repairing masonry, upgrading electric and HVAC and refurbishing bathrooms and kitchens.
Tom Schuett, of Schuett Development, said the company has all of its financing in place and hopes to close on the purchase of the building by June. Construction would begin shortly after.
“The historic nature of the building, together with the valuable project-based section 8 subsidy for 117 units should make this a priority investment for North Dakota in order to preserve the building and the federal subsidy,” the company said in its application.
Once the rehabilitation of the building is complete, the company will also begin offering its CompassionCare services for the elderly and disabled, according to Schuett, who described CompassionCare as independent living with services, such as cleaning and issuing medications, and includes an on-site registered nurse.
“It allows them (residents) to age in place and not prematurely move into a nursing home when they only need help with a few things,” Schuett said.
Also, the state’s five-year affordable housing needs analysis, highlighted by the company, calls for housing rehabilitation, preservation of existing housing and senior-friendly housing.
With a shortage of senior housing with services, Schuett said he thinks more programs, such as CompassionCare, should be added to section 8 housing developments, taking better advantage of space that already exists.
Another section 8 project recently rehabilitated by Schuett Development is Park View Terrace in Moorhead, Minn.
"It’s a dramatic change," he said of the building.