WALLINGFORD — The town Housing Authority is seeking up to $3 million from a competitive state grant to rehabilitate a newly acquired property and expand affordable housing at the site.
On Tuesday, the Town Council authorized the application for a CT Community Challenge Grant from the state Department of Economic and Community Development (DECD).
DECD plans to release $20 million to $50 million in this initial round, according to information from DECD.
Grant sizes range from $1 million to $10 million per project. Wallingford is requesting $3 million.
Applications are due Jan. 14, 2022, and the announcement of awards is scheduled tentatively for March or April.
Wallingford’s grant funding would be used to rehabilitate 2 Wharton Brook Drive — a vacant mixed-use commercial and residential property — and add up to 16 new units of low to moderate income housing at the Ulbrich Heights apartment complex, located behind the site.
The Wallingford Housing Authority purchased the 3,888-square-foot building and .92-acre property in May and plans to move its office into the former commercial space.
The current office, 45 Tremper Drive, would be converted into additional housing.
“It's contiguous to two of our properties and just makes more sense than where we currently are in the neighborhood,” Kelly McDermott, Housing Authority executive director, said Wednesday.
McDermott said that the town purchased the building with damage from when the building caught fire in April 2019.
Fire officials said at the time that the blaze started in the kitchen of an apartment unit. The apartment had smoke and fire damage and the laundromat beneath it had water damage. Three other apartments and a convenience store in the same building did not appear to be damaged.
“If you drive by, it's boarded up,” McDermott said, “and we try to take care of it when illegal dumping happens, or graffiti happens on the site. That was a big part of why we took ownership of it, because it was this long-term site that went through so many things that just aren't productive for the community.”
The DECD grant would be used to renovate the residential areas of the building and build the new units.
McDermott said that the town has applied for a $500,000 federal grant to renovate the commercial areas into office space through U.S. Rep. Rosa DeLauro’s office.
The award notification may come by the end of the year or in January, McDermott said.
“We have two funding sources that are going to accomplish the renovation of that existing building if they're both awarded,” she said.
McDermott said during the council meeting Tuesday that the DECD grant requires a 50 percent match, so $1.5 million in leveraged funds is needed for Wallingford’s $3 million grant request.
“That makes a difference on the application, actually,” she said. “The amount of leveraged resources you can show into a project actually increases your scoreability and your ranking.”
Leveraged funds can be anything that is non-state or non-federal dollars, McDermott said. An appropriation request counts as match, as would debt service, contributions from private partners and the Housing Authority's own business fund.
To date, the Housing Authority has contributed $285,000.
“With the anticipated cash flow for that property, we'd be able to leverage almost $3 million in debt service as well. We have some private partners as well in this project,” she said.
The Housing Authority makes a payment-in-lieu-of-taxes (PILOT) to the town on rental income.
Ulbrich Heights pays 12.5 percent of net shelter rent, which amounts to between $120,000 to $140,000 a year, McDermott said.
All sites have waiting lists, and each list can reach a maximum of 300 families, McDermott said. Apartments come up about once a month.
“The Town of Wallingford is working really hard right now on developing an affordable housing plan per state statutory requirement and has a deadline,” McDermott said. “This project would really be supportive of increasing your affordable housing stock in town, getting it up to the state minimum. We’re really excited that we were considered for this application.”