Dripping Springs city council supports workforce housing

Dripping Springs city officials have thrown their support behind two potential apartment complexes that have applied for federal tax credits to help create workforce housing.

Earlier this month, the Dripping Springs City Council approved resolutions in support of applications filed by the Western Springs and Merritt Headwaters developments for low-income housing tax credits from the Texas Department of Housing and Community Affairs (TDHCA). Both developments want to build apartment complexes within the Dripping Springs city limits.

Michelle Fischer, Dripping Springs City Administrator, said the resolutions are one step toward the possibility of offering more affordable housing options in the city.

“We need both [levels of worker]. We hear from employers often how hard it is to find employees. It’s hard to find a place to afford here, especially if you’re an entry level worker.” Michelle Fischer, Dripping Springs City Administrator

Western Springs is a proposed apartment complex that is to be two stories, which falls in line with current city ordinance.

Laura Myrick, principal with BETCO Consulting, LLC, said Western Springs is a proposed 72-unit development located along U.S. 290 near city hall that could have two and three bedroom units. 

Myrick said Western Springs would have an approximate mix of 25 percent market value apartments and 75 percent income restricted units.

She said the location was selected due to its proximity to amenities. In addition, the location could be close to job opportunities, which could allow future residents to be close to their jobs.

“A lot of businesses in Dripping Springs have had a difficult time maintaining employment and finding employees,” Myrick said.

She added many entry-level employees who work in Dripping Springs have to live in South Austin, Buda or San Marcos. Those employees often find jobs closer to their residences and away from Dripping Springs.

“That doesn’t seem like a far commute, but when you think about it, it’s a ways away for a lot of people,” Myrick said.

Merritt-Headwaters, to be located on the northside of U.S. 290, is a proposed 80-unit apartment complex on 7.6 acres along U.S. 290 in the Headwaters Planned Development District (PDD).

As a result of the PDD, Fischer said Merritt is allowed to have a three-story complex.

Fischer said the proposed complex could have a 50-50 split when it comes to market rate versus income-restricted units.

The News-Dispatch reached out to Merritt Communities for comment but did not receive a response as of press time. 

Fischer said Western Springs is the furthest along so far. Any potential apartment complex built would join The Springs apartments, which were recently annexed into the city limits.

Both Merritt and Western Springs applied for nine percent housing tax credit program, which is the more competitive of two programs offered by TDHCA. Myrick said the Internal Revenue Service administers the tax credit program.

The credits are awarded to eligible participants to offset a portion of their federal tax liability in exchange for the production or preservation of affordable rental housing, according to the TDHCA website.

Myrick said the program differs from Section 8, or subsidized, housing as there is a public and private partnership. She also said the housing tax credits program is not affiliated with the U.S. Department of Housing and Urban Development.

Additionally, residents must meet certain guidelines regarding income in order to be selected.

“This is the most successful program on putting housing for workforce men and women who don’t make enough money yet to buy a big home,” she said. “This is a far cry from subsidized housing.”

Applicants are selected based on criteria such as financial feasibility, indicators of local support, size and quality of units and amenities provided to the tenants.

Myrick said Texas receives $65 million for the tax credit program, which is dispersed across several regions. Only one development in Region VII, which includes the Dripping Springs area, will receive tax credits.

Myrick said Western Springs is aware of Merritt and they understand the competitive nature of the program. She said if they are not successful, they could continue conversations with the city to look at other avenues for development. They could also consider reapplying.

“If it’s our development or theirs, the winner we would want to be is Dripping Springs,” Myrick said.

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