COVID-19 stimulus money could provide low-income housing tax credits
WCNC Charlotte, James Brierton, March 22, 2022
U.S. Congresswoman Alma Adams (D-NC-12) and Representative David Rouzer (R-NC-07), both from North Carolina, have introduced a new bill in the U.S. House of Representatives that would make American Rescue Plan funds available for affordable housing developments receiving low-income housing tax credits.
H.R. 7078, known as the LIHTC Financing Enabling Long-term Investment in Neighborhood Excellence Act or LIFELINE Act, would use the emergency stimulus money first introduced during the COVID-19 pandemic.
“The legislation removes the statutory barriers in place, so that cities, counties, and states can use their State and Local Fiscal Recovery Fund dollars to support affordable housing developments,” an announcement from Adams’ office explains.
Mecklenburg County was awarded $215 million in funds and has $114 million remaining, according to the county.
The legislation is welcomed news for low-income housing developers.
“More and more people need affordable housing because of rent growth but it’s becoming harder and harder to produce the same amount of housing with the resources we use to have because construction costs are rising,” Lee Cochran, the Senior VP of Development for Laurel Street, an affordable housing developer in Charlotte.
Cochran said the need for low-income housing has grown significantly in recent years but the cost to construct them has gone up 20% in the past year.
“Developments that were funded with low-income housing credit across North Carolina were ready to go but they couldn’t go and start construction because they had a funding gap because of that construction cost,” he explained.
However, if the proposed bipartisan bill passes it would provide funds available to offset those rising construction costs. Adams said this help is necessary to address the housing crisis.
“Our city needs an additional 32,000 units of affordable housing to meet the current need,” Adams said. “This means more than 55,000 Charlotteans don’t currently have an affordable place to live.”
Cochran said this legislation would free up about $170 million of stimulus funding allocated to affordable housing in the state.
“We will develop as much as we can,” Cochran pledged. “Ultimately the constraint is how much public dollars and public resources are put towards the problem.”
Laurel street told WCNC Charlotte they are committed to providing affordable housing and looking into innovative ways to fund projects by working with private sectors, partnering with churches, and nonprofits.