South View Estates Gains Added Flexibility Under Salina Housing Grant Agreement

The Salina City Commission voted 3-0 on Monday to approve an amendment to the South View Estates, LLC, Moderate Income Housing grant agreement, expanding the number of eligible homes that can be used to meet the project’s obligations under the state-backed program.

Mayor Mike Hoppock recused himself from the line item and did not participate in the discussion or vote.

City staff told commissioners the amendment was needed to allow Phase 3 of the three-phase South View Estates development to be included in the Moderate Income Housing, or MIH, grant agreement. The change gives the developer additional flexibility in matching qualifying buyers with eligible homes.

Staff said the city already has a broader development agreement in place for the property that brings together the project’s various incentives. In addition to the MIH component, the property is also tied to the Kansas Housing Investor Tax Credit, or KHITC, which is a separate state-run program connected to income tax credits and is not part of the city’s development agreement.

According to staff, the project was not awarded funding during the first round of the KHITC program in 2023, but did receive an award in the second round that year.

Under the MIH portion of the agreement, the development must provide 24 units for eligible moderate-income homebuyers. Staff said there is still an income qualification requirement that leaves six units needing to be matched with MIH-qualified buyers.

At present, the developer can draw eligible homes from Phase 1 and Phase 2 of the South View Estates project. The request before commissioners was to fold Phase 3 into the agreement as well, allowing homes across all three phases to be used to meet the 24-unit obligation.

Staff said the developer has already identified four eligible homebuyers interested in units in Phase 3, which would account for four of the six remaining units needed.

One of the challenges, staff explained, is that the subdivision includes different housing products, and the timing does not always line up between available homes and qualified MIH buyers. In some cases, the right type of home may already be sold out or purchased by a non-MIH buyer before a match can be made.

By adding Phase 3, staff said, the development would have more options available to better match buyers with the right homes and keep the project in compliance with the grant agreement.

City staff also said they had spoken with the Kansas Housing Resources Corporation, which did not object to including Phase 3. The amendment needed to be documented in the city’s development agreement in order to satisfy the state’s expectations.

Staff told commissioners there is no new fiscal obligation to the city tied to the amendment. Instead, the change is intended to keep the project aligned with the grant agreement while preserving access to the funding already in place.

Following discussion, commissioners approved Resolution No. 26-8338 amending the South View Estates, LLC, MIH grant agreement on a 3-0 vote.