City rushing to get trailer park land deal done

Port Washington aldermen on Tuesday agreed to negotiate an agreement with Horizon Development, which wants to buy the former trailer park on South Spring Street that’s owned by the city and construct a 40-unit senior apartment building there.

The development company, which plans to create affordable housing by using tax credits from the Wisconsin Housing and Economic Development Authority, hopes to reach an agreement with the city in the next 10 days so it can meet the deadline to apply for other funding for the project.

“That’s going to be very difficult,” City Attorney Eric Eberhardt warned Horizon officials.

Horizon representatives told the city they don’t expect to have every detail of the purchase in the agreement. Instead, they said, they would incorporate numerous clauses that would allow the city opportunities to back out of the deal if things don’t work out.

The city could void the deal by refusing to annex the property, which is currently in the Town of Port Washington, for example, or by denying the zoning needed for the project, said Will Rutherford, a development associate with Horizon.

“There really is no risk to the city,” he said. 

“We fully understand it’s a tall request,” Horizon Director of Development Phil Schultz said. “It’s a bind we get into because of all the different timelines.”

The firm won’t give up on the project if an agreement can’t be reached immediately, he said, but it could push the project back by a year. 

Rutherford told aldermen that Horizon can move ahead if the agreement isn’t reached until mid-July, but reaching an agreement by June 15 would give the company the best chance of receiving the financing from the HOME Consortium for the project. 

In addition, Horizon would seek financing from Federal Home Loan Bank of Chicago, Rutherford said.

It would also require the city to create another tax incremental financing district — a pay-as-you-go district where the developer, not the city, would pay the upfront cost of development and be repaid a portion of the money through increased taxes on the land.

Christy DeMaster, the city’s TIF consultant, has looked at the proposal and said it will pay off, City Administrator Mark Grams said.

Horizon would pay $280,000 for the 2.4-acre former trailer park land, Rutherford said, although the money would not be paid for 15 years.

Grams noted that most communities would sell land like this for $1 to a developer, especially since the trailer park site is not a particularly attractive parcel.

High-tension electrical lines cross the property and railroad tracks border the east end of the lot, making it difficult to sell.

Aldermen were amenable to the project and agreed to try and reach an agreement as quickly as possible to give Horizon the best chance to obtain its funding.

“I don’t see any pitfalls in starting negotiations,” Ald. Mike Ehrlich said.