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Release No. 98-02-05
February 19, 1999

Commission Approves 42 Rental Properties for Funding, Tax Credits

Jefferson City -- The Missouri Housing Development Commission approved funding for 42 affordable housing developments for fiscal year 1999 during its regular monthly meeting Feb. 19 in Jefferson City.

MHDC administers rental housing production programs, including the federal and state Low Income Housing Tax Credits. Rental production programs also consist of MHDC fund balances and federal HOME funds. Tax credits are a reduction in tax liability allocated to a qualified development, which are generally sold to create equity. Affordable rental rates are made possible with low interest rental housing production loans and housing tax credits. At least 15 percent of the HOME funds are set aside to finance Community Housing Development Organization (CHDO) proposals. At least 10 percent of tax credits must be set aside for nonprofit organizations.

This year's funding includes:

· $6,706,500 MHDC Loans

· $7,306,000 Federal HOME loans

· $2,029,975 Federal HOME CHDO funds

The Commission also allocated more than $13.4 million in Low-Income Housing Tax Credits.

· $6,706,500 Federal Low-Income Housing Tax Credits

· $6,706,500 Missouri State Low-Income Housing Tax Credits

The 42 developments will create 1,164 new affordable housing units and rehabilitate an additional 86 units throughout the state. The units include 963 family units and 287 units designated for the elderly. [A full breakdown of units and funding in each region of the state is enclosed].

These funded developments are located in areas throughout the state, with some in areas that had not received funding in recent years, such as Poplar Bluff and East Prairie, according to Bob Holden, Missouri State Treasurer and MHDC Commissioner. "We were very pleased to fund proposals in areas that have a great need for new affordable housing, as well as to help rehabilitate housing in other communities."

The funding process began when the MHDC staff received 117 proposals in response to a Notification of Funding Availability sent out in August. Three proposals were later withdrawn from consideration by the developers.

Each proposal was underwritten to assess the details, ensuring the development is a good risk. This requires reviewing the land, construction costs, equity, funding source and operational details. It also includes evaluating creditworthiness, the ability of the developer or organization to proceed with the work, and the appropriate rents for the units.

MHDC staff has made personal visits to all the sites and held public hearings on the proposals. They also requested comments from local and state elected officials and federal and state agencies regarding the proposed developments.

The proposals recommended to the Commission for approval represent a fair geographic distribution across the state, concentrating on areas of highest need; the sponsor's ability to leverage funds with other conventional or government sources of financing; the experience of the developer and associated professionals; the reasonableness of the development costs and rents; and readiness of the developer to proceed.

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DOWNLOAD:  1999 Rental Housing Approved Funding