Wednesday, July 31, 2019
Kristina Tirloni (512) 475-4743
- 2019 tax credits will finance over 4,900 affordable rental units
- Every eligible at-risk application received tax credits; second year in a row
- 2018 developments yielded approx. $4B economic impact
State housing agency’s $79.5 million tax credit allocation to expand housing options for income-eligible Texans
(AUSTIN) – Texas Department of Housing and Community Affairs (TDHCA) has announced awards through the 2019 Housing Tax Credit (HTC) Program allocation that will help finance the development of rental properties offering reduced rents and increased housing options.
TDHCA will provide $79.5 million in housing tax credits to private developers constructing or rehabilitating 68 properties across the state that will offer rents affordable to households earning up to 60 percent of the area median family income.
“As Texas continues to outpace other states in terms of job creation and livability, TDHCA’s multifamily financing remains an important component to ensuring our expanding workforce has adequate, high quality housing in which to live,” said TDHCA Acting Director David Cervantes. “The housing tax credit program is a remarkable example of how public and private dollars can serve all Texans and benefit the overall economic health of our state.”
The credits are expected to help finance the building of 52 high quality, new properties with a total of 3,822 units, and the rehabilitation of 16 properties offering 1,148 units to income-eligible households across the state. The at-risk set aside, totaling more than $11.9 million for the 2019 cycle, is used for the rehabilitation or reconstruction of aging housing developments that could soon lose rental subsidies provided to their low-income residents.
“For the second year in a row, every eligible at-risk application we received will be awarded tax credits,” explained Marni Holloway, TDHCA director of multifamily finance. “Because of this, TDHCA’s efforts will help preserve housing affordability for some of our most vulnerable Texans in rural communities.”
The Housing Tax Credit Program, authorized under the Internal Revenue Code, is the state’s primary means of directing private capital toward the development of affordable rental housing. Investors purchase credits allocated to developers to which they may apply toward their federal tax liability each year for 10 years on a dollar-for-dollar basis in exchange for their investment in the property.
Developers use proceeds from the sale of the credits as financing for their property. The credits announced today are designed to cover approximately 70 percent of each property’s eligible development costs.
Since 1987, more than 260,000* affordable housing units have been built or preserved in Texas using the Low Income Housing Tax Credit Program. It’s estimated that the new construction and rehabilitation of developments that opened in 2018, alone, led to the creation of 26,000 jobs statewide with compensation totaling $1.03 billion. The total economic impact generated for the state was approximately $4.4 billion**.
*As of December 2018.
**total does not include job creation, increased property tax valuations, and economic activity made possible by reduced rents.
About the Texas Department of Housing and Community Affairs
The Texas Department of Housing and Community Affairs is committed to expanding fair housing choice and opportunities for Texans through the administration and funding of affordable housing and homeownership opportunities, weatherization, and community-based services with the help of for-profits, nonprofits, and local governments. For more information about fair housing, funding opportunities, or services in your area, please visit www.tdhca.state.tx.us or the Learn about Fair Housing in Texas page.
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