St. Paul plans to direct property taxes on portions of the former Ford plant toward construction of 195 affordable housing units on the site, which is undergoing a multimillion-dollar transformation into the new Highland Bridge development.

The City Council on Wednesday unanimously approved the creation of two new tax-increment financing (TIF) districts on the site that will allow St. Paul to funnel up to $46.9 million in public funding to three proposed housing projects.

The 122-acre site in St. Paul's Highland Park neighborhood is bustling with construction traffic these days, a stark contrast to the years it went dormant while officials decided how to tackle one of the largest redevelopment projects in city history.

TIF is a tool used by cities and other public authorities to promote development in areas where it may not otherwise occur. The city is planning to capture the incremental increases in property taxes spurred by development on the Ford site and use that money to pay for improvements that advance public interests — in this case, affordable housing.

The two TIF districts approved Wednesday include two planned developments with market-rate senior housing. The new tax dollars generated by those projects will also be captured and put toward affordable housing.

Minneapolis-based Project for Pride in Living is leading the development of two housing projects southwest of Ford Parkway and Mount Curve Boulevard. One, called Nellie Francis Court, will include 75 units of workforce housing affordable to those earning less than 60% of the area median income, which is $62,040 for a family of four.

The other, to be run by Emma Norton Services, includes 60 units that will be used as transitional housing for women earning less than 30% of the area median income, which is $22,050 for an individual.

St. Paul-based CommonBond Communities is developing a senior housing project nearby with 60 affordable units for those earning 30% of the area median income.

Developer Ryan Cos. purchased the former Ford site in 2019 and broke ground last summer, setting in motion plans to build a modern urban village with more than 3,800 units of housing — 20% of which the city has said must be affordable.

City officials approved a separate $53 million TIF package in 2019 to help fund the construction of Highland Bridge's streets, parks and utilities. The city in 2016 projected it would contribute up to $275 million in public financing to the Ford site's development, and Ryan is expected to request additional funds for more affordable housing.

Katie Galioto • 612-673-4478