By Miles Flynn | Southern Indiana Business Report
FRENCH LICK — Lack of workforce housing is now identified as one of the biggest stumbling blocks rural America faces in economic development. In Orange County, a large employer, the local economic development organization, government leadership, and other organizations are now actively working to tackle the problem.
Spearheading the drive are French Lick Resort, and parent company Cook Group, along with the Orange County Economic Development Partnership, and construction is now underway on the first two homes of a major building project.
Chuck Franz, Cook Group vice president and chief information officer, explained the direct action on the part of the firm follows an attempt from four years ago to bring together banks and builders to construct homes on empty lots the government of French Lick planned to gift to the endeavor. “We just weren’t able to ever connect the dots,” he said.
State grant accelerates project
Meanwhile, in September 2019, French Lick Resort was selected by the Indiana Housing and Community Development Authority as one of four employers around the state eligible for $1 million grants for housing projects through the Anchor Employer Workforce Housing Program. The plan, at the time, was for the resort to partner with a builder to construct 10-15 new single-family homes to be sold at affordable prices to people working in Orange County, with the proceeds from each sale going to fund further construction via a revolving loan fund. Prices for the three-bed, two-bath homes have been targeted all along to be low enough to allow for payments in the neighborhood of $600 per month, which should be an easy transition for residents now paying that much or more in rent. “We want to stay $150,000 and below to get to that number,” Franz said.
The building sites selected were resort-owned land on Klondike Street on French Lick’s north side and at a farm just north of West Baden Springs on Abbeydell Pike, purchased by the resort in 2019. The French Lick site could accommodate 25 lots, Franz said, while the West Baden Springs site has room for approximately 75 lots. “The total project, at the end of the day, is 100,” Franz said.
Resort wanted to move even faster
While the announcement by the state may have helped put the local effort into high gear, the exhaustive process required led the resort leadership to decide to do something even faster in the meantime. So, the work that’s now underway at the Abbeydell site is not only being funded by the resort, it’s being completed by the resort’s own construction team. (HVAC is being subcontracted to the local firm HPDI.) Franz explained the resort crew has been kept busy in the past on projects such as the relocation of a historic barn to the resort’s stables, the pavilion at the Pete Dye Course, and the new dormitory units behind the French Lick Springs Hotel. While it’s a skilled crew, Franz said, “We’re not saying we can build 100.”
The plan is that by utilizing the in-house team on the first two homes, the resort’s finance department can track all costs involved to come up with a model that will allow a builder to be plugged in for future construction, all while ensuring sale prices can be held down to the desired level. Franz said the process has already been very revealing, especially in tracking COVID’s impact on the cost of building materials. Fortunately, he said, a decrease in prices is already being seen on the second home.
Work on the first home is slated to be complete by the end of this fall, and the hope is to have foundation work finished at the same time for another three homes. “We’ll get all the way up to eight as quick as we can,” Franz said.
New targets for state monies
That initial goal of eight homes mentioned by Franz is being dictated by the capacity of the existing sewer infrastructure available at the Abbeydell site. Additional sewer work will be needed to go beyond eight homes at the location, and sewer and water will be required to construct any homes on the Klondike site in French Lick.
That infrastructure, of course, comes with a hefty price tag, and the plan at this point is that state monies secured through the housing grant and, possibly, from the state’s new Regional Economic Acceleration and Development Initiative program could help there. The state is expected to make available $500 million through READI, with regional grants of up to $50 million. Proposals submitted to the state will be reviewed through October and November, and first-round investment decisions will be announced in December.
The OCEDP has been actively working on the READI front with Regional Opportunity Initiatives and Radius Indiana, which are the two groups heading up the pursuit of READI funds on behalf of Brown, Crawford, Daviess, Dubois, Greene, Lawrence, Martin, Monroe, Orange, Owen and Washington counties. OCEDP Executive Director Kristal Painter said she believes French Lick Resort’s commitment to the project puts Orange County well ahead of the curve. “Housing is a big focus of the READI planning that is taking place for our region,” she related. “Everyone involved in the planning process understands the importance of housing for workforce attraction, business attraction, talent attraction, quality of life, and everything else that entails regional economic acceleration and development. Infrastructure development is a huge hurdle for communities trying to solve the housing shortage, especially when you’re talking about development of workforce or affordable housing. Assistance for the infrastructure costs will allow developers to keep the housing prices affordable for workforce. The teams at ROI and Radius have been diligently working on the creation of a true regional plan and have listened to the needs of each community. They’re actively developing program ideas that will help communities overcome hurdles and challenges in ways that work for each individual community.”
Getting people into the homes
Throughout the undertaking, Franz has repeatedly stressed that it’s truly a project for the community and not just the resort. The business isn’t profiting off of the process, and in fact, the homes themselves aren’t only for resort employees. “You need to work in Orange County,” Franz explained. “That’s the only stipulation to apply.”
Covenants for the homes are still in the process of being crafted. Another mechanism being put into place will allow homeowners who end up needing to move out of the county within a three-year window to sell their home back to the resort in order to keep the property in the system.
For the initial homes, the resort is working with local realtors to sell them. However, he said there’s an education process involved to keep the prices at the predetermined level. “It’s not market driven,” he emphasized.
After the first few homes, provided the infrastructure is in place and a builder is recruited for large-scale construction, the OCEDP will help facilitate the process of matching homes to buyers through a special committee that organization has created. “We each have a role to play, and Orange County Economic Development Partnership will assist in the marketing and education to prospective homeowners,” Painter shared. “Having already spoken to a few eager residents lets me know just how important all of this really is.”
Expanding Cook Group’s model beyond Orange County
As ambitious as the project is already, Cook Group isn’t limiting its scope to the two sites in French Lick and West Baden Springs. Conversations are underway in neighboring Paoli and Orleans, and Franz believes the model being developed can easily be replicated wherever municipalities are willing to step up with infrastructure support to make further development possible. “It’s not only a need in Orange County,” he said.
Right now, the firm is in the exploratory stages of expanding the project into Owen County, which is home to a Cook manufacturing plant and is facing a very similar housing issue. The company is looking at a piece of land and talking with local government officials. “It doesn’t have to stop at 100,” Franz said. “… This is sort of the model project here in Orange.”
Resort isn’t only homebuilder in town
The new houses being constructed by French Lick Resort in West Baden Springs aren’t the only homes being built in the area. Two arms of French Lick town government are expected to break ground before the end of August on three more houses on downtown lots purchased by the town through beautification and redevelopment efforts since the rebirth of French Lick Resort as a major tourist attraction. “We need to do something with those, and right now the housing is the biggest problem in French Lick,” said French Lick Redevelopment Commission President David Wolford. “There is no housing.”
The work is being made possible through that agency’s collaboration with the Dickason Community Development Corporation — an entity formed approximately a decade ago to undertake the rehabilitation of a long-neglected commercial and residential space downtown known as the Dickason Building. That space is now home to apartments and several businesses.
The redevelopment commission worked with consultant Brad Hurt of Urban Initiatives to come up with a plan of how to proceed on the new housing effort, and the decision was made to build three homes right away on Wells Avenue — the stretch of State Road 56 a short distance south of the resort. Two houses will be built fronting the highway, with room for an additional home to be built later. A third house will be built on the back side of the tract.
The two homes in the front will be three-bed, two bath homes. The house in the rear will be a two-bed, two-bath home. All three houses will have two-car garages and fairly large yards. Wolford explained while the consulting firm concluded the space could accommodate up to seven homes, officials decided that kind of arrangement wasn’t suitable for the town.
All three homes will be built in a craftsman style that will match existing homes in the neighborhood. The local contracting company Lindsey’s Construction is building all three homes, and the plan is to have them complete by early 2022.
Dickason is working with the builder, using funds from the redevelopment commission, and the company will also be working with realtors on selling the homes. As with the houses being built by the resort, these homes will also be reserved for people working in Orange County. Unlike the resort, construction costs and market value will determine the price tags. However, Wolford said, even if the effort only breaks even or loses a small amount of money, it will still be worth it to address the housing problem and get the properties back on the tax rolls. No matter what the final price is, he noted the income-based loan terms available through the United States Department of Agriculture should make the homes more affordable than many rental options currently available in town.
The three homes are seen as just a starting point for the collaboration of the redevelopment commission and Dickason. There’s more town-owned land available, and plans under consideration include further home construction, apartment construction, or land sales to other builders. “We’re just really excited to offer new housing in the area,” Wolford said.