Business Specialties
Development
Jul 29, 2009
By: Barbra Murray, Contributing Editor
When the credit markets froze, so did the development of much-needed affordable housing across the nation, but the U.S. Housing & Urban Development is making strides in tackling the issue. The agency, acting through its new $2.25 billion Tax Credit Assistance Program, which is funded via the American Recovery and Reinvestment Act of 2009, has just approved the second dispensation of approximately $1.2 billion to state housing finance agencies in 26 states to finance the resurrection of various affordable rental housing programs.
As the credit crunch took hold, it squeezed the life out of the low-income housing tax credit market. The tax credits, or LIHTCs, had previously proven successful in motivating investors to supply financial backing to developers of apartment properties for low- to moderate-income households. However, as the value of LIHTCs went into a downward spiral, so did affordable housing construction activity. According to HUD, the progress of an estimated 1,000 projects accounting for 150,000 residential units came to a halt--and that is where TCAP comes into play. This second round of grants allots funds for the remaining states that were not covered in the first round. California, for example, has been awarded nearly $326 million while Florida and Texas will receive approximately $101 million and $148 million, respectively.
All told, TCAP will make affordable housing available to approximately 35,000 households in the 50 states, the District of Columbia and the Commonwealth of Puerto Rico. But the program's benefits go beyond the augmentation of the nation's affordable housing supply. With the revival of low-income apartment property construction come construction jobs, which began to evaporate rapidly with the crash of the single-family housing market. Given the overwhelming demand for employment opportunities, the program is held to a Recovery Act-enforced deadline that calls for the state housing agencies to focus on construction projects that can begin right away and deliver by Feb. 16, 2012.
Affordable housing seekers and construction workers are not the only groups that will benefit from TCAP. Developers will get a helping hand, too. "This program will not only create hundreds of thousands of quality jobs and provide thousands of new affordable housing units for residents, but it will also allow developers to invest in new housing projects or restart stalled projects, all of which will greatly impact local economies across the country," a HUD spokesperson told CPN.
By: Barbra Murray, Contributing Editor
When the credit markets froze, so did the development of much-needed affordable housing across the nation, but the U.S. Housing & Urban Development is making strides in tackling the issue. The agency, acting through its new $2.25 billion Tax Credit Assistance Program, which is funded via the American Recovery and Reinvestment Act of 2009, has just approved the second dispensation of approximately $1.2 billion to state housing finance agencies in 26 states to finance the resurrection of various affordable rental housing programs.
As the credit crunch took hold, it squeezed the life out of the low-income housing tax credit market. The tax credits, or LIHTCs, had previously proven successful in motivating investors to supply financial backing to developers of apartment properties for low- to moderate-income households. However, as the value of LIHTCs went into a downward spiral, so did affordable housing construction activity. According to HUD, the progress of an estimated 1,000 projects accounting for 150,000 residential units came to a halt--and that is where TCAP comes into play. This second round of grants allots funds for the remaining states that were not covered in the first round. California, for example, has been awarded nearly $326 million while Florida and Texas will receive approximately $101 million and $148 million, respectively.
All told, TCAP will make affordable housing available to approximately 35,000 households in the 50 states, the District of Columbia and the Commonwealth of Puerto Rico. But the program's benefits go beyond the augmentation of the nation's affordable housing supply. With the revival of low-income apartment property construction come construction jobs, which began to evaporate rapidly with the crash of the single-family housing market. Given the overwhelming demand for employment opportunities, the program is held to a Recovery Act-enforced deadline that calls for the state housing agencies to focus on construction projects that can begin right away and deliver by Feb. 16, 2012.
Affordable housing seekers and construction workers are not the only groups that will benefit from TCAP. Developers will get a helping hand, too. "This program will not only create hundreds of thousands of quality jobs and provide thousands of new affordable housing units for residents, but it will also allow developers to invest in new housing projects or restart stalled projects, all of which will greatly impact local economies across the country," a HUD spokesperson told CPN.
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