Economic and Community Development Committee — Columbia, SC
Date: 2021-05-25
Time: 13:00

COLUMBIA ECONOMIC AND COMMUNITY DEVELOPMENT COMMITTEE
 MEETING AGENDA
 TUESDAY, MAY 25, 2021


The Columbia Economic and Community Development Committee will conduct a meeting on
Tuesday, May 25, 2021 at 11:30 a.m. using Video Conferencing Technology. The meeting will
be streamed online at www.columbiasc.gov.

CALL TO ORDER
COMMITTEE DISCUSSION

1. Review of Student Housing Incentives - Mr. Ryan Coleman, Economic Development
 Director

ADJOURNMENT




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COLUMBIA ECONOMIC AND COMMUNITY DEVELOPMENT COMMITTEE
 MEETING AGENDA
 TUESDAY, MAY 25, 2021


The Columbia Economic and Community Development Committee will conduct a meeting on
Tuesday, May 25, 2021 at 11:30 a.m. using Video Conferencing Technology. The meeting will
be streamed online at www.columbiasc.gov.

CALL TO ORDER
COMMITTEE DISCUSSION

1. Review of Student Housing Incentives - Mr. Ryan Coleman, Economic Development
 Director

ADJOURNMENT




 Page 1 of 1
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MEETING DATE: May 25, 2021

DEPARTMENT: City Clerk

FROM: Erika Hammond, City Clerk

SUBJECT: Review of Student Housing Incentives - Mr. Ryan Coleman,
 Economic Development Director
FUNDING SOURCE &
ORIGINAL BUDGET:

FOCUS AREAS: Economic Prosperity - Endless Possibilities




Updated: 5/24/2021 10:47 AM Page 1
 Packet Pg. 2

COLUMBIA ECONOMIC AND COMMUNITY DEVELOPMENT COMMITTEE
 MEETING MINUTES
 TUESDAY, MAY 25, 2021

CALL TO ORDER

Attendee Name Title Status
Sam Davis, Chair Councilman - District I Present
Tameika Isaac Devine Councilwoman - At Large Present
Will Brennan Councilman - District III Present

COMMITTEE DISCUSSION

1. Review of Student Housing Incentives - Mr. Ryan Coleman, Economic Development
 Director

Ryan Coleman, Economic Development Director provided a historical overview of the student
housing incentives and the projects that have been completed. The incentive was adopted in
2014. At the time, it was more aligned with the commercial development incentive. Student
housing was not initially specified as the purpose. A lot of the initial interest in the program
came from student housing developers. We amended the original resolution in 2014 to apply
only to student housing projects, to include Bull Street and to allow for soft costs to apply
towards the $40,000,000 total. Then we amended it again to allow for the inclusion of
comparable market rate apartment projects and included a sunset provision for December 31,
2015. In 2018, Reign Living approached the city and county with a project to be located on Shop
Road. We reopened the program for several months and they accepted a reduced tax incentive at
33%. That was the end of the official student housing incentives. The commercial development
incentive program began in 2019 and it is generally in line with prior program criteria. Student
housing is not excluded from this; it is taxed at 6% just as a multifamily project would be.

Councilor Devine said if we decide to continue this, it needs to be clear that any due diligence or
investments that are done, is at the developer's own risk.

Ryan Coleman, Economic Development Director said we provide two pages of guidelines and
we can strengthen that language and place it in a more prominent location. I am clear with
student housing developers that we are concerned about saturation, student housing is being
scrutinized more, and if they are interested in bringing these projects, they need to focus on the
other public benefits they are providing.

Councilor Davis asked Ryan to share the verbiage with the committee members before it is
changed.

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 COLUMBIA ECONOMIC AND COMMUNITY DEVELOPMENT COMMITTEE
 MEETING MINUTES
 TUESDAY, MAY 25, 2021

Councilor Brennan inquired about the idea of the incentive having a layer of public benefit and
public infrastructure. What form has that taken in the past?

Ryan Coleman, Economic Development Director said public benefit has been treated broadly.
We look at it in the general sense of placing underutilized property into a higher and better use.
Public benefit can include the creation of tax revenue, utility revenue, housing, or jobs. We also
like to look at what is above and beyond expectation. Are they creating public parking or traffic
and right-of-way improvements? Are they increasing safety? Are they remediating brownfields?
What is the icing on the cake?

Councilor Brennan said it would be great to research and possibly include this information. The
environmental cleanup that the developer at the Bombers Stadium is offering is icing on the
cake. Come up with some of those line items to include in the language.

Ryan Coleman, Economic Development Director reported that since 2014, six student housing
projects have received the tax credit incentive and five are operational. The sixth one is Clayco.
The Lofts on Lincoln is the seventh project and it is categorized as a market rate housing project
that rents by the unit, not by the bed.

Missy Gentry, P.E, Assistant City Manager noted that some of the projects have the zoning of a
private dormitory meaning there are four bedrooms.

Krista Hampton, Planning and Development Services Director clarified that some of these
projects are special exceptions. It depends on the location and density. The Edge on Assembly
Street was the last project done by special exception.

Ryan Coleman, Economic Development Director reviewed the taxable investment numbers from
Richland County. The five projects represent $182 million in taxable accessed investment. The
assessed value for Reign Living is about $4.5 million and they are slated to open during the fall
of 2021. After the tax credit is applied, the projects generate $2.7 million in property tax
revenues and the city receives 17% which is $470,358. The projects generated $32,861 in
business license fees and the average annual water/sewer revenue was $570,000. The county
receives up to 20% depending on their millage. The existing projects consist of 1,030 units and
3,228 beds combined. The Edge has 206 units and 679 beds and with an $80 million investment,
the city could expect to see up to $180,000 in tax revenue. The Lofts on Lincoln will have 278
units and with a $72 million investment, the city could expect to see up to $161,000 in tax
revenue.

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 COLUMBIA ECONOMIC AND COMMUNITY DEVELOPMENT COMMITTEE
 MEETING MINUTES
 TUESDAY, MAY 25, 2021


Councilor Devine said I never doubted that this deal needed to be done in order to incentivize
and create value on properties that our tax structure did not support. I think it has done its job.
How much further do we go or have we primed the pump enough? When we sunset the student
housing incentive, the intent was to use the same model to incentivize other commercial
development projects. Are we not sharing the tool with commercial developers? Is it not
attractive to other commercial developers? Are the commercial developers not coming through
the pipeline? It seems like the tool is being used by student housing developers. Is that saturation
and will there be a bubble that ultimately bursts? Will we have units that aren’t being occupied?
At what point do we pivot from having this be the product that continues to come through to
getting the commercial development that we need?

Ryan Coleman, Economic Development Director said the analysis of that is more technical than
I can answer to and it is a subjective question. I have been clear that the interest to do more
student housing has diminished. We want to do more multifamily projects. I am not at the point
where I can tell somebody no or to give them additional criteria. That’s where I look to you all
for guidance in shaping that [policy] going forward.

Councilor Davis said we will end up with more discussions with property owners and the
residents in the area being considered for student housing. We are looking at a project that is
benefiting the public good.

Councilor Brennan said these developers identify Columbia as a strong market for student
housing because of the potential for high rent rates and the growing higher education population.
I am concerned about the unintended consequences we are seeing, especially in district three.
The rent rates are so high that now there is a tiered system for student housing with some going
for $1,000 per bed. The Rosewood neighborhood is a developer hot spot for student housing,
single-family, duplexes, and new construction. There is a need to incentivize market rate
housing, but we also need to layer in a percentage of workforce specific units within these
market rate developments. How can we morph this incentive to have a percentage that is
workforce friendly? The average median income is $45,000 to $50,000 for a household in the
29201 area. We have to figure out how to bundle this in a different form so that it is not student
housing specific but to promote market rate housing with a workforce approach. Affordable
housing and tax credits is a different development process because a lot of them use non-profits
that are already off the tax rolls. This would be a specific market rate workforce housing
initiative that I would like to move forward with this committee.


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 COLUMBIA ECONOMIC AND COMMUNITY DEVELOPMENT COMMITTEE
 MEETING MINUTES
 TUESDAY, MAY 25, 2021

Ryan Coleman, Economic Development Director added that we see an outsized interest in
student housing because these projects receive favorable financing.

Councilor Davis said a well-rounded city has room, space, and amenities for everybody. You
don’t want to identify people by where they live. We are better off when people can afford to
live in a quality development, where they want to live. We need to continue to talk about how we
will maintain relationships with developers that want to come but at the same time consider if we
are getting all of the products that we need as a city given our goals for growth and development
and the quality of life we have committed to in the future. The bottom line is deciding how to
keep the development coming while considering the impact it has. We are not eliminating
student housing incentives but we don’t want to give the appearance of overload.

Ryan Coleman, Economic Development Director said we have three options: continue as is;
disallow student housing; or a middle ground approach that elevates the value that these projects
bring. We have to determine the additional criteria.

Councilor Davis suggested that they pinpoint the fundamental issues with the incentive along
with the impact on growth and future development.

Councilor Devine suggested that Ryan make a proposal to include amendments that raises the
bar of the public-add and criteria for analyzing all projects. I don’t want people to think that if
they meet the criteria, their requests will be approved even if they don’t do certain things to make
sure it is a smart development for that area. This is not about students. For me it is about
saturation of the market and the bubble bursting at some point leaving us with units that are not
kept up.

Councilor Brennan said I would like to see us immediately trend away from the words “student
housing” and gear towards a market rate housing with a quality of life expectation for any
housing initiative incentive that we put together. Moving forward, we don’t want to see rent by
the bed or other tell-tale signs of student housing developments.

Ryan Coleman, Economic Development Director said we had student housing interest, but it was
concentrated outside city limits. We wanted to pull those projects closer to the urban core and
there’s benefit from that. We need to strike a good balance with the policy going forward.

There was a consensus of committee members to ask staff to draft criteria, concepts, and
recommendations for value adds that create a balanced incentive based on today’s discussion.

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 COLUMBIA ECONOMIC AND COMMUNITY DEVELOPMENT COMMITTEE
 MEETING MINUTES
 TUESDAY, MAY 25, 2021


ADJOURNMENT

The meeting was closed at 12:33 p.m.

Respectfully submitted:


Erika D. Moore Hammond, CMC
City Clerk




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