PITTSFIELD, Mass. — The Community and Economic Development Committee has recommended two housing tax increment exemption, or TIE, agreements to the full council.

 

The exemptions recommended last week will help developers create market-rate housing on East Street and Tyler Street. 

 

"The TIEs are modeled exactly after the TIFs," Director of Community Development Deanna Ruffer said. "It is not a subsidy nor are any existing funds being diverted from other programming or services ... It is the incremental phasing in of the taxes for the increased value."

 

Ruffer said, in general, there is a demand in Pittsfield for market-rate housing, and that lack impedes Pittsfield companies from hiring.  

 

Business Development Manager Michael Coakley affirmed this and said companies such as General Dynamics lose qualified employees because they can't find a place to live.

 

"One of their main issues in recruitment is finding market-rate housing for their employees," he said. "There is a huge demand." 

 

AM Management plans to invest $2,584,125 in 235 East St. to develop 27 units, 24 of which will be market-rate.

 

The agreement will provide an exemption on property taxes based on the growth portion in assessed valuation of the property at 100 percent for the first year and decrease 10 percent each year for 10 years, reaching 10 percent in year 10.

 

The agreement would begin July 1, 2021, and extend to 2031.

 

A representative of AM Management said the property was once a Jewish community center and was most recently Reigning Love Church.

 

The housing would be developed over three floors and would include storage, laundry, parking, and a landscaped area outside.

 

The committee mostly discussed housing in general in the city, and Councilor Dina Guiel Lampiasi of Ward 6 said although there is a need for market-rate housing in the city, she did not want to separate this from the need for affordable housing.

 

"One of the things that makes me nervous is when we talk about them separately because when we have affordable and market-rate separately that sort of stratifies our community," she said.

 

Ward 1 Councilor Helen Moon agreed and added that she rather see more mixed-income housing. 

 

Ruffer said there are two ways to do this and mixed-income units can be within the same development or neighborhood. She said both of the projects up for discussion are really too small to have mixed units within but will exist in income-diverse areas. 

 

Moon continued and said she was concerned that new development would displace those who already live in the neighborhoods. She was worried about gentrification. 

 

"No one wants to talk about the consequences when we don't create alternatives for people living in those neighborhoods," she said. "I want to honor the people that are already here. I don't want to leave them out of these kinds of developments."

 

Ruffer said her department continues to work toward affordable housing development, and diverse housing is a benefit to the city. She said it allows for upward momentum within neighborhoods, and residents do not have to move across the city to improve their living situation. 

 

She added that she is hesitant to adopt programming that would mandate a portion of affordable housing in developments. She said there is not enough development in the city

 

To accommodate the project, the committee also approved an amendment of the Housing Development Zone Map that creates incentives for developers to create market-rate housing. This amendment would extend this zone three parcels to include the entire property. 

 

The city has amended this map in the past.   

 

The second is a tax incentive agreement for 730-748 Tyler St. and 765 Tyler St. for Mill Town Capital.

 

"Tyler Street is a really important geographical location, and it connects the city's two largest employers," Tim Burke, CEO and managing director of Mill Town Capital said. "We hear from employers large and small there is a lack of housing in the area across the entire spectrum."

 

The private investment group will develop two projects: the redevelopment of five adjourning parcels on 730-748 Tyler St and the construction of two new multi-family structures with parking in the rear. A 16-unit building will front on Tyler Street with four units in a separate building fronting on Forest Place. 

 

The project will create 20 units of market-rate rental housing. This project represents $6.3 million of capital investment.

 

The second project on 765 Tyler St will include the rehabilitation of an existing multifamily building -- $3.6 million will be invested to create 16 units of housing and two retail spaces.

 

The exemption would be scheduled the same as the East Street agreement and city assessors have estimated the value of the proposed TIE for 730-748 Tyler St. to be approximately $151,259. Mill Town Capital would pay approximately $209,429 in taxes over the 10-year term of the agreement. 

 

The estimated value of the proposed TIE for 765 Tyler St is approximately $84,189 and Mill Town Capital would pay approximately $271,307 in taxes over the 10-year term of the agreement.

 

765 Tyler St. received the most attention because it was affordable housing. Ruffer said the complex was deteriorated and has been neglected. She said it had become a place for "undesirable activities" such as drug use and sex work.

 

Moon drew issue with this and although understood the need to improve the property, was concerned about completely eliminating some affordable housing stock. She did not want to take away resources from those facing housing insecurity.

 

"I don't think we talk enough about the rights of people who are drug users and sex workers, and we kind of push them aside," Moon said. "Where should they go? They have social factors and hardships, and I don't feel comfortable just moving them out."

 

She did thank Mill Town who worked with Berkshire Housing to rehouse people displaced from the building.

 

Councilor at Large Earl Persip said he agreed with Moon but that the building really did need to be cleaned up.

 

"No one should be living in there," he said. "I was in there 15 to 20 years ago and it was terrible."

 

Burke said it was hard for his team to enter the building and apartments were littered with needles and human waste. He said carpets, kitchens, and bathrooms were filthy.

 

"Where should people go? I don't have an answer for that, but no one should be living in that building," he said. "I don't care what their circumstances are. It was inhumane, and that is what led us to our decision."

 

Moon was the only one to vote in the negative against this project.