New Round of Funding to Spur Housing Construction and Preservation, Support 2,400 Jobs in Communities Across Illinois
CHICAGO – December 10, 2013 – (RealEstateRama) — Governor Pat Quinn today announced more than 1,470 affordable apartments will be created or preserved for working families, seniors and people with disabilities in communities across the state. Today’s announcement is part of the Governor’s agenda to ensure quality affordable housing for working families, seniors and people with disabilities across Illinois.
“Easing the cost of housing for hard-working families, seniors and people with disabilities is a priority in Illinois,” Governor Quinn said. “We must do everything we can to both increase and preserve quality affordable housing to help working families achieve housing stability and create thousands of jobs.”
Financing for the apartments was approved from two sources – the federal low-income housing tax credit (Housing Credit) and the Illinois Housing Development Authority’s (IHDA) Preservation Now program. A new round of Housing Credit financing will support the construction and rehabilitation of 1,021 units in 16 developments in the areas of Chicago, Metro East, Springfield and Peoria. Under the state’s Preservation Now program, more than 450 units of affordable housing for hard-working families and seniors will be preserved in six developments located in Southern Illinois, Peoria and the Quad Cities. This combined financing will support an estimated 2,400 jobs statewide and local real estate tax and revenue will be generated to spur economic activity. Under Governor Quinn, the IHDA has financed the creation and preservation of more than 17,800 rental homes statewide.
As the state’s housing finance agency, the IHDA allocates the federal Housing Credits through a competitive process to finance qualified affordable housing developments. With the recent approval of the IHDA board, developers will now seek private investment for the new developments. Work to build new housing or rehabilitate existing multifamily developments will generate construction and post-construction jobs. Construction is expected to begin by next spring.
In 1986, Congress created the federal tax credit program to spur the development of affordable housing. It is widely considered the most productive affordable housing financing tool in the nation. The sale of federal housing credits to private investors generates equity, and this equity reduces the need for the developer to borrow money for the new development. This savings results in lower rents.
This was the second round of funding under the Preservation Now program, which Governor Quinn launched this year. Last month, the IHDA approved financing to preserve an additional 600 affordable rental units for seniors and people with disabilities in Chicago and Peoria, creating more than an estimated 500 jobs. Approximately $245 million in project-based rental subsidy will be preserved over the next 20 years as a result of Preservation Now, which provides funding through the Illinois Affordable Housing Trust Fund and other resources. Trust Fund revenue is generated from half of the state real estate transfer fee.
“Governor Quinn is a strong advocate for leveraging public-private partnerships to meet the affordable housing needs of the state’s low- to moderate-income residents,” IHDA Executive Director Mary R. Kenney said. “The Housing Credit and Governor Quinn’s Preservation Now program effectively safeguard the affordability of these developments for decades.”
To qualify for the affordable units, residents must earn at or below 60 percent of the area median income (AMI), or $35,340 in the Chicago area, $32,280 in the Springfield area, or $33,240 in Madison County for a two-person household.
Developments approved for financing include:
Nehemiah Homes in Springfield – A new construction family development of 30 rental single-family homes will be built on various sites in Springfield’s Eastside neighborhood. Developed by the Calvary Mission Baptist Church, this is the third phase of the Nehemiah Homes development initiated to provide decent affordable housing after storms ravaged the area.
Aurora Impact Initiative in Aurora – Forty units of vacant single-family homes will be acquired and rehabilitated to return to the market as rental housing in Aurora. All units will receive rental assistance through the Aurora Housing Authority.
Wisdom Village of Oak Street – An abandoned building and unused tennis courts on Chicago’s Near North Side will be replaced with a 106-unit new construction mixed-income development for seniors.
Bloomington-Normal Scattered Site – In the Bloomington-Normal area, 26 vacant single-family homes will be acquired and rehabilitated to return to the market as rental homes. Work will include upgrades to add more energy-efficient features.
May Apartments in Edwardsville – An existing independent living development serving seniors and people with disabilities will be rehabilitated, and a new wing will be built in Edwardsville – creating and preserving 70 affordable apartments.
Shawnee Village in Marion – The 120-unit Shawnee Village for working families and seniors in Marion will be equipped with new flooring, roof and HVAC replacements, energy efficient appliance and lighting upgrades.
Sandburg Village Apartments in Galesburg – New flooring, windows, roof and HVAC replacements, energy efficient appliance and lighting upgrades will be added to the 128-unit Sandburg Village Apartments in Galesburg.
For a full list of approved developments, please visit www.ihda.org/about/news.