BERLIN – A proposed senior living development on Broad St. provoked some skepticism over requested tax abatements and the low-income requirements during the Monday Berlin Mayor and Council meeting, when the developer outlined his proposal.
The council did not vote on a resolution of support for lack of a quorum. There must be three town council members for a quorum. Council members Elroy Brittingham and Dean Burrell were absent, and Councilman Troy Purnell, as an owner of the company that owns the land in question, recused himself, leaving only two voting members of the town council.
“I’m not about to do anything that’s going to impact the town or the neighborhood detrimentally,” Purnell said.
A partnership which builds and manages low=income senior housing has proposed building a 40-unit senior housing development on Broad St., on 4.5 acres now owned by Berlin Properties North.
“We are the developers, builders, and management company,” said Jonathan Triandafilou, a partner with John Schuster Inc. “We’ve been developing and building them for over 25 years and enjoy a great reputation on the Eastern Shore.”
The senior housing developments they build are funded through low-income state loans and tax credits sold on the New York stock exchange, said Triandafilou.
The affordable one-bedroom apartments would be income restricted and open to one single senior over 62 or a married couple, with one spouse over 62.
Rents would be graduated based on income, with three to five units at $294 per month available to seniors making 30 percent of the median Worcester County income, 10 to 12 units at $424 per month available to seniors making 40 percent of the median income, 10 to 12 units at $553 per month available to seniors making 50 percent of the median income and seven to eight units at $683 per month available to seniors making 60 percent of the median income.
“All these units are independent living. All of them are self sustaining…all the units are the same,” said Triandafilou.
The development would include a community center and van service to doctors’ offices, grocery stores, restaurants and outings. Senior citizen organization
The maximum annual income for one resident to qualify for an apartment at the proposed senior living development tops out at $28,000, while a couple’s combined annual income is limited to $36,500. Management does do income verification, Triandafilou said.
A manager is on site during business hours unless the partnership can find a resident manager. “That’s what we prefer, but it doesn’t always work out that way,” said Triandafilou.
The closest example of the partnership’s work are the cottages at River House on Pemberton Dr. in Salisbury, now on the third phase of construction. An open house at the Salisbury location has been tentatively planned for anyone curious about the proposed future Berlin senior living site.
Only one phase is planned for Berlin, but Triandafilou said if the first phase turns out well, they might consider more units.
Financing through the state of Maryland is a lengthy and detailed process, said Triandafilou. The application includes the rents to be charged to residents by income level, for example. The state also wants assurance that the town or local jurisdiction is contributing to the project meant to fulfill a need for low-income seniors.
The partnership is asking the town of Berlin for a 10-year tax abatement, with 90 percent abated the first year, 80 percent abated the second year and so on.
“It enables us to reduce our operating costs which helps us reduce the rents for our proposed tenants,” said Triandafilou.
Triandafilou assured the town that the rental rates would be kept low. “We can’t take these funds, turn around, and make a market rate deal,” said Triandafilou, who added the state requires monthly reports showing that income restrictions are being met.
The audience was allowed to air some questions and concerns, although there was no official public hearing.
“My huge issue tonight is the water and the sewer,” said resident Mary Moore, a longtime resident of Broad St., who also had some reservations on the requested tax abatement and negative revenues to the town.
Triandafilou assured Moore that the partnership would pay the connection fees for water and sewer that are required for any new service.
Moore said that rather than giving the project a 10-year tax abatement, the project should be giving back to the town.
“Obviously, no one does anything without making a profit,” Moore said.
Moore later suggested that the senior housing project partnership provides a new water tower to the town to improve slack water pressure.
“That abatement does bother me big time,” said Councilwoman Paula Lynch during the discussion. “You’re asking us to give you something and down the road that may cost us a lot.”
While wastewater improvements are under construction, the water system in town also needs a major overhaul in the future that will cost “megabucks,” Lynch said.
Ten years is a long time for a tax abatement, she added.
Triandafilou said the tax abatement plan would be graduated. “We’re paying into the town slowly,” he said.
The project would also be paying connection fees for water and sewer, totaling $139,000, plus impact fees, and in future would pay for sewer and water just like any resident, he said.
Councilwoman Lisa Hall said she had issues with the tax abatement and pointed out that there are other impacts on the town, like ambulance and fire services. With 40 to 80 senior residents, ambulance calls will increase, Hall said.
Resident Jim Hoppa wondered whether there were ways other than the requested tax abatements that the town could contribute to the project.
Other options would be reduced or abated impact fees or reduced or abated tap fees, Triandafilou said.
“We have a policy we don’t negotiate our tap fees,” said Williams. Impact fees could be negotiated, he said, but, “It’s one bucket or the other you’re taking it from.”
Moore later said that Berlin’s population needs balance and the town does not want too many low-income people moving into town, citing the need to attract residents to support local businesses.
“These people aren’t going to be walking uptown to get a salad with grilled chicken for $15,” said Moore.
Williams agreed the population in town needs to be balanced.
“That’s why the Mayor and Council reserve the right to allocate EDUs,” Williams said.