North Carolina Eighth District U.S. Representative Larry Kissell called the funding “a positive step as we continue to focus on turning our troubled economy around.”
“The funding will help the state put good people to work building affordable homes,” Kissell said in the release. “It is a common sense solution to a desperate need in our communities.”
The money will be doled in a tax credit assistance program, explained NCHFA Director of Government Relations and Communications Margaret Matrone.
“It’s going to be used to help affordable rental housing, in the form of apartments, for people who receive 60 percent or less of their county’s median income,” Matrone said. “Basically, this program was created in 1987, and it’s a federal tax credit for the owners of affordable apartments.”
The U.S. Department of Housing and Urban Development describes tax credit assistance as grant funding for capital projects.
Matrone explained the NCHFA facilitates the development of affordable rentals with federal revenues by offering tax credits to private developers, who then sell the potential revenue from the credits to investment groups.
The concept is that there will then be less debt on the part of the developer, and less service on the debt, so that it makes financial sense to offer the apartments at a rental fee below the market price.
“This program depends on a developer being able to sell the use of the credits to an investor, and in the past Fannie Mae has been a big investor,” she continued. “But, with the economy the way it’s been the last couple of years, it has become more difficult for these private developers to sell the credits. So with this program, instead of getting just tax credits, they’ll get part tax credits and part tax credit assistance.”
She said tax credits allow most of the affordable rentals in the country, “certainly in North Carolina,” and said over 54,000 apartments have been developed in the state using the programs.
Projects funded from 2007 on are eligible to receive the tax credit assistance.
The last time a developer was awarded tax credits through the NCHFA for a project in Richmond County was in 2006, however, when Greenway Development Company was awarded $476,000 in tax credits to build Cameron Grove Apartments.
An attempt to contact the company by phone were unsuccessful, and they did not immediately return an e-mail Thursday.
Developers can apply for this program through the NCHFA. The organization’s website is www.nchfa.com.
This type of funding will be extended to housing finance agencies in 25 other states as well.
Post a Comment
