Ludlow council expresses intent to grant IRB for Fischer Homes development

Haley Parnell
Haley Parnell
Haley is a reporter for LINK nky. Email her at [email protected]

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A previous version of this story used the incorrect name for Cityview Station development. The name has been corrected in the story. LINK regrets the error.

Ludlow City Council voted to approve a memorandum of agreement to grant developer Fischer Homes a financing incentive for the Cityview Station development proposed for the hillside off Highway Avenue in Ludlow.

The incentive comes in the form of an Industrial Revenue Bond, which municipalities can issue to provide a lower interest rate for the financing of a project.

The 30-year IRB for $120 million is the next step in the plans that have been ongoing since last year to get the $106 million development up and moving around summer 2023.

The 64-acre development has plans that include 32 single-family homes, 213 condominiums, and 220 apartments. It is expected to bring in approximately 1,063 new residents to the city.

Plans for the Crestview Station development in Ludlow. Photo provided | Fischer Homes project plans

The IRB will allow the city of Ludlow to collect 75% of real estate taxes from the development, while Fischer Homes will get 25%.

“The fact that we’re getting 75% back is substantially higher than what you see throughout Northern Kentucky,” Ludlow Mayor Josh Boone said.

The city was not obligated to issue an IRB to Fischer Homes, but they would not be getting money back from the project if they hadn’t. IRBs in Kentucky provide an incentive for cities to have residential projects. The debt of the project is the debt of the developer, not the city. 

Ludlow will collect $16,336,000 in city real estate revenue over a 30 years from the IRB.

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By passing the resolution at the council meeting, the city expressed its intent; it did not grant the IRB. Fischer Homes will have to return to the council in 2023 for the issuing of the bonds.

Jim Parsons, a partner at Keating Muething and Klekamp PLL, specializes in tax incentives for business development. He explained that almost any major development in the last 10 years in Bellevue, Dayton, Newport, and Covington has happened with some incentive, whether it’s an IRB, TIF, or something else. 

Other developments in the river cities that have used an IRB include the Hotel Covington expansion in Covington, Newport on the Levee, and the Newport Aquarium in Newport.

The City of Ludlow benefits ($33 million in tax revenue) according to the Fischer Home plans include:

  • City real estate tax revenue (30 years) $16,336,000
  • Fire/EMS real estate tax revenue (30 years) $8,491,000
  • Payroll tax revenue – direct from homebuilding activity $468,000
  • Auto tax revenue (30 years) $2,912,000
  • Rental unit tax revenue (30 years) $165,000
  • Insurance tax revenue (30 years) $4,752,000

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