Storm Lake backs tax credit bid for 48-unit west side apartments

Storm Lake gave AXIS Capital a key local boost Monday, unanimously approving a support letter for the Orange City developer’s bid for state workforce-housing tax credits tied to a proposed 48-unit apartment building near Ace Hardware. City officials framed the move as a practical step toward easing the west side’s housing squeeze, but the letter itself does not approve construction.

The project is described as a $6 million development that would bring one-, two- and three-bedroom apartments to a 3.5-acre parcel east of Ace Hardware. Under the Iowa Economic Development Authority’s Workforce Housing Tax Credit program, a small-city project can receive up to 20 percent of qualifying investment, with total benefits capped at $1 million per project. The current application deadline for this round is June 10 at 4:30 p.m., and the award announcement is set for September 15.

Economic Development Services Specialist Lee Dutfield told the council the project would add assessable valuation, fill a real housing need and help move the apartments across the finish line. He also told members that a support letter from Storm Lake is often an important signal in the state review process, and that developers who receive one typically go on to secure approval from the Iowa Economic Development Authority.

The council had already cleared the site in April, rezoning the parcel from institutional to residential so apartments could go there. City staff said the land fits the comprehensive plan, sits among high-density residential and community-commercial zoning, and could be developed within a reasonable timeframe. The rezoning report also noted there had not been a new solid multi-family apartment product in Storm Lake since 2013.

Adam Howerzyl said AXIS manages 2,300 units across Iowa, including Paradise Park Apartments and Seneca Place Apartments in Storm Lake. AXIS says it took over management of Seneca Place in 2023 and describes that property as a 48-unit, income-restricted building with one-, two- and three-bedroom layouts, a detail that shows the company already has a footprint in town.

The meeting also produced a small reminder of how closely housing and neighborhood issues can overlap. Councilwoman Maggie Martinez asked whether the company would help with the stray-cat problem around Paradise Park, where feeding stray cats can violate city code. Howerzyl said the company had tried to address the issue before and would do so again.

Storm Lake’s broader housing picture explains why the council is still pushing new apartment projects. The city’s updated housing needs analysis projects demand for about 1,450 new housing units from 2024 through 2035. Earlier figures showed only about 455 new units were permitted between 2010 and 2024, leaving a gap that officials say still shapes every housing decision, including how much public subsidy the city should extend and whether the return in workforce housing is worth it.