Lexington Station denied on 8-7 vote

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A 288-unit, six-story mixed-use building planned near Lexington Parkway and University Avenue faces an uncertain future. Approval of the site plan for Alatus’ Lexington Station project at 411-417 Lexington Parkway was denied Feb. 5 on an 8-7 vote.
A decision on the site plan is final unless it is appealed to the St. Paul City Council within 10 days.
The commission rejected site plan approval on a 8-7 vote Jan. 22, then voted 10-4 to lay the matter over. The layover allowed time for the commission, city planning staff and the city attorney’s office to prepare a motion with a legal basis to deny the site plan for the $57 million development. Site plans must meet a series of findings for approval.
Affordability, the project’s compatibility with the surrounding neighborhoods and a long-planned east-west bike and pedestrian connection that the project would block were debated at length by the Planning Commission. But while issues such as affordability are a concern for many commissioners, affordability is not an issue that can be considered when voting on a site plan.
Alatus Director of Development Chris Osmundson told the commission’s zoning committee in January that 155 of the apartments’ rents would be affordable to those at or below 60 percent of area median income. Fifteen units would have four bedrooms to allow co-living, with rents around $900 per person. The building would also include alcoves, studios, one-bedroom, one-bedroom with den, two-bedroom and four-bedroom units.
Supporters including Zoning Committee Chairman Cedrick Baker contended that Alatus’ plans would bring development to a site that has been vacant for 12 years. He cautioned that how commissioners vote could derail what they want.
Supporters said there is no legal reason to deny the site plan. “For a site plan, specific standards must be met,” said Commissioner Kristine Grill. She and some commissioners didn’t see a legal basis to deny approval.
Grill pointed out that currently the only way to require affordable units in a development is if a public subsidy has been provided, such as low-income housing tax credits or grants. Despite pressure from the planning commission, city staff has not brought forward inclusionary zoning requirements that would require developers to add affordable units in all developments.
“I don’t pretend that this project is perfect but there’s no legal reason to deny it,” said Commissioner Nate Hood.
Other commissioners disagreed. Planning Commission Chairman Luis Rangel-Morales said even if the developer promises affordable housing, there is no legal mechanism for the city to keep that in place. “All we have is the word of the developer,” he pointed out.
Project foes said that there’s a need for even more affordable housing near Green Line light rail and questioned whether the development would bring the type of housing the adjacent neighborhoods need. “It’s obvious that this developer does not have this community in mind,” said Commissioner Adrian Perryman.
“I have a hard time with really rigid parameters that don’t take the values of the community into consideration … we don’t just have a housing shortage we have an affordable housing shortage,” said Commissioner Kathy Mouacheupao.
Perryman said the project would have a negative impact on its surrounding neighborhoods, citing potential property tax effects, impacts on area rents and the building’s visual impact. He questioned whether any increase in property taxes brought by redevelopment would indeed benefit neighboring communities where residents are claiming they would seek damages.
Another sticking point is that regional income levels vary greatly from what is in St. Paul and in neighborhoods around the development site. For a family of four, regional area median income is $103,000. That is for the 13-county Twin Cities metropolitan area. Project foes said a lower level must be kept in mind for St. Paul, possibly considering annual incomes around $58,000, putting the affordable level around $32,000.
Apartment prices have been estimated at $850 to $900 per bedroom for the four-bedroom units, with one-bedrooms at about $1,400 and two-bedrooms at more than $2,000. But those figures don’t factor in affordability.

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