Application deadline next week

When the development group seeking to transform the former St. Elizabeth Hospital in Hannibal into a senior apartment complex submits its application for low-income housing tax credits, it will do so with local support.

“We’ve secured 58 written endorsements, from multiple governments, businesses, residents; a variety of different entities and people,” said Jeff LaGarce, city manager.

Among the local governmental bodies lending its backing is the Marion County Commission, which approved issuing a letter of endorsement on Feb. 20.

“I think it’s a good idea to support it,” said Eastern District Commissioner Larry Welch. “What’s good for Hannibal is good for Marion County.”

“If they can find somebody to come in and make use of that (former health-care complex) I think it’s a win-win situation,” added Western District Commissioner Steve Begley.

LaGarce believes the application to the Missouri Housing Development Commission (MHDC) is due in Jefferson City next week.

“That is their application, not ours, though we support it 100 percent,” he said.

While the MHDC voted to stop issuing state low-income housing tax credits in late December, a federal tax credit is still available to investors in affordable housing through the MHDC.

Application error

Renovation plans hit another snag recently. Fortunately it was a problem the city council could correct, which it did during its Tuesday night meeting at city hall.

According to LaGarce, when the St. Elizabeth partnership group was preparing its application to the MHDC for the low-income housing tax credits, it was discovered that one sentence in both legal descriptions had been omitted.

“We do not know the cause of this error, nor did we make this error,” wrote LaGarce in a memo to the city council, stressing that the mistakes “need to be fixed.”

The resolution that was approved allows the “missing sentence to be inserted/included into each exhibit, the lease itself, and the accompanying assignment of grant and land-use option,” according to LaGarce.

Reportedly the property’s legal description is “huge.”

“It spans a full page, comprises two separate tracts, and includes all or parts of 12 original lots platted in the 19th Century. It’s the parts of lots that create complications,” said LaGarce.

In December 2017, the council approved a resolution entering into a 50-year lease at a rate of $1 a year with The Villas of St. Elizabeth, LP.

“This modification neither invalidates the Dec. 31 lease nor changes the intent of either party,” said LaGarce. “It’s basically a scrivener’s error that’s being repaired with formal legislation.”

City efforts

The city took a number of steps in 2017 to help make the renovation project fly, including taking ownership of the Virginia Street property. That step was taken in order that the site might be eligible for an Environmental Improvement Energy Resources Authority (EIERA) Grant through the Missouri Department of Natural Resources (DNR).

“We’ve submitted the preliminary application, which DNR has approved, but we haven’t submitted the ‘full’ application yet,” said LaGarce. “That requires complete environmental assessment reports of asbestos in the building. The DNR and EPA (Environmental Protection Agency) are performing those assessments right now, at no cost. Once they’ve completed those assessments, those documents become part of our ‘full’ EIERA Grant application, which is otherwise ready to go.”

If awarded the grant a public entity, such as the city of Hannibal, it may obtain funding up to $200,000 to abate asbestos on public property.

“Once we obtain the assessment reports, we’ll determine the amount to seek. If there is only $150,000 of asbestos removal necessary for that building, we’ll apply for $150,000,” said LaGarce, who expects the asbestos removal to occur this summer.

Once the asbestos removal has been completed the city still intends to turn ownership of the property over to the developers.

The city decided to seek the EIERA Grant to lower the cost of rehabilitating a portion of the property into senior housing. It was anticipated that reducing the project’s cost would enhance the chances that the developers could secure tax credits to help pay for the $9.5 million project.

Reach reporter Danny Henley at danny.henley@courierpost.com