The Housing Authority of New Orleans' ongoing effort to replace the affordable housing units lost when the Iberville public housing project was torn down has received a boost in the form of a tax break.
McCormack Baron Salazar, the St. Louis-based development firm that has partnered with the authority to turn the site of an old Winn-Dixie grocery in Treme into new apartments, snagged a 25-year "payment in lieu of tax" deal last week for that $23 million project.
The Industrial Development Board, which works to incentivize private development in the city, unanimously backed a PILOT for the St. Louis Street site, which most recently was used as a set for the HBO series "Treme."
The deal requires McCormack Baron to keep 30 of the 76 units at the site affordable in exchange for paying a baseline of roughly $4,600 a year, instead of their normal property tax bill.
The $4,600 will increase by 3 percent annually throughout the life of the deal, and the firm will also pay an administrative fee to the IDB. Its first payment will be due Feb. 1 of next year.
Officials said the four-story complex they plan to build at the Winn-Dixie site will replace some of the 821 public housing units that were lost when the Iberville complex was torn down.
"This is part and parcel of that whole neighborhood redevelopment," said the IDB's counsel, David Wolf.
HANO has in recent years worked with private partners to build what are known as "mixed-income" developments — developments that include both subsidized and market-rate apartments — as replacements for its former housing complexes, which had become centers for poverty and often crime. The effort is aimed at alleviating the ills associated with concentrated poverty and giving low-income residents more modern homes to call their own.
The former B.W. Cooper (originally Calliope), St. Bernard, Lafitte and C.J. Peete (originally Magnolia) complexes were rebranded as Marrero Commons, Columbia Parc, Faubourg Lafitte and Harmony Oaks — mixed-income neighborhoods with far fewer units for the very poor than the former public housing complexes.
Iberville became Bienville Basin in an on-site redevelopment that has been handled by HRI, another local developer. McCormack Baron, the firm behind Harmony Oaks and Marrero Commons, is handling the off-site component of the vast Iberville replacement project and has been working to pepper low-income units throughout the surrounding Treme neighborhood.
Of the 821 former Iberville units, HANO and its partners have fully replaced 579, have another 102 under construction and have yet to break ground on 50, officials said. That will leave 90 still to go.
McCormack will continue that work by transforming the old Winn-Dixie, which was recently demolished, into a complex called City Square 162.
The project's first phase has an estimated price tag of $23 million and will be funded partly with low-income housing tax credits and state grants. Landis Construction Co. will be the contractor, and about 40 percent of the construction team will be locals, said Judith Moran of McCormack Baron.
The development will have a fitness center and a business center.
Of the 76 one- and two-bedroom units in the first phase, 30 will be offered to former residents of the Iberville development or others with low incomes, and 46 will be available at market-rate rents.
Generally, residents of publicly owned housing may earn no more than $36,750 a year in some cases; in others, they may earn no more than $27,600.
Residents who benefit from HANO's Section 8 program, who include many one-time residents of the city's former housing projects, make even less than that — no more than $13,800 a year for a one-person household in some cases, or $23,000 a year at most.
City officials intend to extend a portion of the Lafitte Greenway so that it runs near the complex, providing a walking and cycling trail for residents, Moran said.
State Sen. Troy Carter of New Orleans, one of the IDB's 15 members, recalled when the Winn-Dixie was erected during his time as a New Orleans city councilman representing that neighborhood.
"It offered great promise to that community, and when it closed it offered great devastation," he said, adding that the revamp "shows that a development is not ever truly dead."