GOSHEN — The Goshen City Council tabled a request by Lacasa and Oaklawn for up to a $500,000 loan during its meeting Monday night.

Oaklawn and Lacasa are working on creating 48 permanent supportive housing units in six phases that would be located on the Oaklawn campus, 302 Lakeview Drive. These one- and two-bedroom apartments would be for Oaklawn clients and not for the general public.

It was explained during the meeting that one of the barriers for these clients is transportation, so having living units on the same campus as to where they are being treated eliminates that issue.

In a PowerPoint presentation, Hunsberger and Mary Bales, manager of Housing Development for Oaklawn, explained that 270 individuals and families, and 500-plus children are in need of these services.

Yet before any of that can start, water and sewer infrastructure needs to be run through the campus to the build site, which is where the $500,000 will come in. The whole $500,000 will not be given at one time to Lacasa, which will handle the money, but instead be disbursed as qualifying bills are submitted, according to the resolution presented to the council.

The first eight units are Phase 1, and, according to Brad Hunsberger, vice president of Real Estate Development for Lacasa, the project won’t be possible without the $500,000 loan from the city. He explained that there has been a drastic increase in construction prices. When the group built a similar project on Westplains in Elkhart it cost about $930,000. Today, the same amount of beds will cost $1.6 million.

All phases, to be built over the next 10 years, will cost $12 million.

According to Hunsberger, the first phase can begin construction at the end of this year.

The $500,000 would come from the city’s Local Major Moves Construction Fund. The fund currently has about $4.5 million in it.

Mayor Jeremy Stutsman explained that money from the Major Moves Fund was set up in a manner that it could be loaned out and then repaid so it is never diminished. It is not part of the General Fund, which is where city expenses are paid from.

The resolution included that no interest would accrue for the first two years of the loan; no payments will be due until construction of the second set of eight apartments is completed; and that upon completion of each eight-unit building, the city will forgive a principal amount of $83,333.

With what is forgiven, the city would commit to pay the loan back from its General Fund (or fund of its determination) into the Major Moves fund.

None of the council members seemed opposed to the resolution, but Councilman Don Riegsecker did want to table the matter so that he could study it further.

Council president Brett Weddell sits on the Board of Directors of LaCasa and took off his council hat to speak as a member of the public.

“I think this is a great opportunity to serve individuals in our community we haven’t served before,” he said.

Community member Glenn Null felt there needed to be more “clawback” included in the agreement just in case Oaklawn and Lacasa faulted on the loan.

He also did not believe the taxpayers should have to pay for Lacasa and Oaklawn’s loan if portions were forgiven.

Stutsman said he believed the build would be beneficial to the community and that the “clawback” is if they don’t build what they say they will, they will have to repay the loan.

Council member Julia King said the benefit of this project is stability.

“It seems to be clearly beneficial,” she said.

Stutsman added additional thoughts.

“I think this is a project that’s good for our community. … We need to continue to invest in our community to fill the pieces that are missing,” he said.

The matter will be readdressed at the council’s Feb. 6 meeting.

Editor’s Note: Look for more from the city council meeting in Thursday’s edition.

Sheila Selman can be reached at sheila.selman@goshennews.com or 574-533-2151, ext. 240311. Follow Sheila on Twitter @sselman_TGN.

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