Real Estate Central

$16.6 Million to Be Awarded in Federal Low Income Housing Tax Credits

LANSING, Mich., June 23 /PRNewswire-USNewswire/ — Interim Executive
Director of the Michigan State Housing Development Authority (MSHDA) Keith
Molin today announced that affordable rental housing will be built or
renovated for modest income Michigan families, the elderly, people with
disabilities, and those at risk of homelessness as a result of approval by
the Authority board and acceptance by Governor Jennifer M. Granholm of
MSHDA’s Qualified Allocation Plan (QAP). The 1986 Tax Reform Act allows for
the award of federal Housing Tax Credits as incentives to developers to
develop low-income housing projects for people with low and moderate
incomes in accordance with guidelines published in a QAP originated at the
state level. The Authority estimates that $16.6 million in tax credits will
be allocated in the fall 2008 funding round.

The $16.6 million in tax credits will leverage $166 million in private
funding generating nearly 1,200 yearlong jobs in construction and related
trades. In addition approximately 865 units of affordable housing will be
constructed.

“We were able to meet the tentative time frame that we announced in
April, due to a dedicated staff effort,” said Molin. “It is our intention
to have the Michigan 2008 Tax Credit allotment awarded no later than the
first week in October.”

Molin stressed that the QAP reaffirms three policy commitments in
support of Gov. Granholm’s agenda.

“Those commitments include providing affordable housing in Michigan. In
addition, the QAP provides support for those with special needs and
homeless populations,” Molin said. “Together these will move us closer to
our goal of developing vibrant communities and neighborhoods across the
state.”

Established by Congress in the 1986 Tax Reform Act, the aim of the
Housing Tax Credit is to stimulate private investment in affordable rental
housing and thus to expand and preserve the nation’s affordable housing
stock.

Owners and investors in low income housing may apply to receive a tax
credit against their federal tax liability if the rental housing has at
least 20 percent of its units for households with incomes at or below 50
percent of the area median, or 40 percent of its units reserved for
households with incomes at or below 60 percent of the area median.

“The Housing Tax Credit program is extremely successful,” Molin added.
It provides affordable housing statewide from special needs residents in
Grand Rapids, to senior citizens in Flint, to working families in Marquette
in the Upper Peninsula.”

MSHDA is a quasi-state agency that provides financial and technical
assistance through public and private partnerships to create and preserve
safe and decent affordable housing, engage in building vibrant cities and
neighborhoods, and address homeless issues. MSHDA’s loans and operating
expenses are financed through the sale of tax-exempt and taxable bonds and
notes to private investors, not from state tax revenues. For more
information on MSHDA programs and initiatives, visit the Web site at
http://www.michigan.gov/mshda.

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[Via Real Estate Newswire]