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New Milford considers affordable housing offer for former school

September 25, 2018

NEW MILFORD — The Town Council is considering a letter of intent from a company to turn the Lillis Building, which houses the school district’s central offices, into affordable housing.

The letter of intent is for Dakota Partners to purchase 50 East St. for $1.6 million, which is what the property is appraised at. Jim Peys, director of acquisition for Dakota Partners, said the investment is a couple of million dollars more because of the asbestos and lead-base paint removal and the historic preservation.

“Our intent was to create a revenue source for the town with taxes and the $1.6 million, but also affordable housing,” he said.

He said the firm is not getting a tax abatement from the town and will pay taxes based on the rents it receives, not on market value. The apartments are considered affordable workforce housing.

Under the proposal, Dakota Partners would restore the historic facade of the old school and add 15 to 20 apartments, a gym and a leasing office. It would also build two apartment buildings in the back. There would be a total of 75 to 80 units.

The breakdown of the range and percentage of affordable housing will be determined by the state based on income, expenses and state funding.

“We want people in the community to afford to live in the community they work in,” Peys said.

This wouldn’t be the company’s first affordable housing project in New Milford. Dakota Partners also built the apartment complex next to CVS. Peys said there’s a wait list of about 350 for the 38 units.

Before Dakota Partners builds anything, the town will need to sign the letter of intent and a purchase agreement, then the company will do an engineering and architectural report.

The Town Council, the school and finance boards, as well as residents, would also need to approve it.

Council members decided to wait to get more information.

They approved applying for a $20,000 grant with the state Historic Preservation Office that will cover a third party study into what the building can be reused for.

This study will include public meetings to find out what residents want. The final report will have these uses and estimated costs to make them reality, as well the historic value, proximity to downtown and demographics that might use it.

The grant application goes out the first week of October and will be reviewed the first week of November so the report can be compiled over the winter.

Tammy Reardon, the town’s grant writer, said she believes the town has a “very high” chance of being selected.

Councilman Peter Mullen was skeptical the study would reveal something new.

“The cost per square foot is more than any other building in town,” he said. “It’s a money pit.”

Others said the office has experience with salvaging old buildings and finding new uses for them. It also gives residents a chance to comment.

Peys said the market study, appraisal and a lot of the information Town Council wants is needed as part of the application for affordable housing and by signing the letter of intent, Dakota Partners would be responsible for the costs.

School officials have been considering the future of the building for months and whether it makes the most sense to renovate the building and make it more accessible or to move central offices to a different location.

In 2016, then-Mayor David Gronbach proposed the town relocate the district offices to the John Pettibone building once it became a community center, but that fell through because Gronbach changed the memorandum of understanding to have the school district front the money for the renovations.

Though the building under the schools’ ownership is grandfathered in and doesn’t have to meet the Americans with Disabilities Act, school officials still want to make it more accessible. Total recommended costs to repair the building and make it more accessible exceed $5.17 million.

“That becomes our problem,” Peys said. “When we made the offer, we did it with our eyes open.”

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