Press Contact Only:
Margaret Matrone, NCHFA, 919-877-5606,
Connie Helmlinger, NCHFA, 919-877-5607,
North Carolina will gain $227 million in affordable rental apartments as the result of federal tax credits approved this month by the Tax Reform Allocation Committee and loans from the North Carolina Housing Finance Agency.
The $17 million of tax credit awards will finance 44 developments providing 2,169 privately owned, affordable apartments in 26 counties. Nearly seventy percent of the apartments (1,435 units) will be designated for families, and 669 units will house elderly residents.
Two developments (65 units) provide housing and coordinate supportive services for residents with disabilities. In addition, 10 percent of the apartments in the other 42 development will be set aside for persons with disabilities, through a cooperative arrangement with local service organizations, the housing finance agency and the N.C. Department of Health and Human Services. These 253 apartments are part of an initiative by the General Assembly in 2006 to create affordable housing for individuals living on Supplemental Security Income (SSI) of approximately $600 a month. The General Assembly appropriated $1.2 million for rent assistance to make the apartments more affordable for disabled persons.
“Combining the state rent assistance with federal tax credits will help us reach our state’s most vulnerable citizens,” said Lucius S. Jones, chairman of the N.C. Housing Finance Agency.
Twenty-two of the apartment developments will also receive $11.6 million of loans approved by the N.C. Housing Finance Agency’s board of directors, and 40 will receive state tax credits as authorized by the General Assembly. The loans and state tax credits make it possible to build new apartments in rural counties where incomes are low, and to reduce the rents in urban counties.
All of the apartments will be affordable to North Carolinians whose incomes are at 60 percent or less of the median, which range from $42,960 for a family of four in Raleigh to $28,260 in lower income areas such as Ashe or Tyrell counties. Adding state tax credits to the federal housing credits makes some of the apartments affordable to households with incomes at 50 percent or less of the median, or $35,800 for a family of four in Raleigh down to $23,550 in Ashe or Tyrell counties.
The N.C. Housing Finance Agency evaluates the tax credit applications on behalf of the Tax Reform Allocation Committee, which consists of Secretary of Commerce James Fain, State Treasurer Richard Moore and State Budget Officer David McCoy.
To recommend the 44 properties, the N.C. Housing Finance Agency evaluated 95 applications for federal tax credits. The evaluation consists of independent market studies of each property, site visits by agency staff, and invitations for comments by local governments. Each property is rated for architectural design, rent affordability, financial stability, capability of the development team, and statewide distribution.
The federal Housing Credit Program finances virtually all of the affordable rental developments now being built nationwide. In North Carolina, the program has financed 48,000 privately owned, affordable apartments since it began in 1987.
To make the properties economically viable at below-market rent levels, the owners are allowed to take a credit on their federal income tax of 9 percent of the eligible costs, for a period of 10 years. Properties that receive federal credits are also eligible for a one-time state tax credit of 10, 20 or 30 percent of the eligible development cost, depending on the county where the housing will be built. The largest state credit applies to developments in counties with the lowest median incomes.
###
The North Carolina Housing Finance Agency is a self-supporting public agency. It has financed 176,000 affordable homes and apartments in the last three decades, including nearly 74,000 homes for first-time home buyers. To learn more, go to www.nchfa.com or call 919-877-5700 or 800-393-0988.
