Developers building low-income housing may have easier access to federal funding if a new bill, introduced by two North Carolina members of Congress, becomes law.
The LIFELINE Act would change federal rules that hinder the use of pandemic relief funding toward building or preserving affordable housing projects that use low-income housing tax credits. It is sponsored by U.S. Rep. Alma Adams, a Mecklenburg Democrat.
“Unfortunately, just like other cities across the country, our community is facing an affordable housing crisis,” Adams said in a video announcing the legislation.
The bill, she said, “solves another piece of the puzzle and brings us closer to a future where every American family can afford a decent, affordable place to live.” It is co-sponsored by U.S. Rep. David Rouzer, a Republican representing southeastern North Carolina.
North Carolina is one of some 20 states that have declared intent to use those federal recovery funds for affordable housing, according to the National Council of State Housing Agencies.
AFFORDABLE HOUSING CRISIS
Financing and building affordable housing only got harder after COVID-19 arrived, developers have previously told the Observer. It’s in large part because of the rising cost for land, construction and labor, which were already on the upswing in a booming Charlotte market.
Julie Porter, president of nonprofit affordable housing developer DreamKey Partners, told the Observer earlier this year that increased costs mean they need to look for more funding sources to close the gap, including from local government, land donations or other philanthropy.
DreamKey is one of dozens of affordable housing and community development organizations to support the bill, according to a release from Adams’ office.
Low-income tax credits, administered locally by the North Carolina Housing Finance Agency, are a key way affordable housing developers help pay for projects. The bill would open up options to use State and Local Fiscal Recovery Funds, awarded as part of the 2021 American Rescue Plan, to further support those projects.
Mecklenburg County was awarded more than $215 million in state and local recovery funds, according to a county recovery plan. That money can be used for in a variety of areas, including public health, services to disproportionately impacted communities, premium pay for essential workers and infrastructure.
In the first of two allocations, the county has dedicated funds to mental and behavioral health, homelessness and workforce development, among other priorities, the Observer previously reported. The county has about $150 million still to be allocated over several years.