IL Invests Federal Tax Credits to Boost Affordable Housing Construction in Metro East
Financing to create apartments for low-income families, people with disabilities
CHICAGO – More than 60 affordable rental apartments will be built in the Metro East area to increase opportunities for working families and people with disabilities, thanks to the allocation of federal tax credits approved by the Illinois Housing Development Authority (IHDA) board. The tax credit allocations will generate an estimated $6.6 million in private equity to build two developments in Metro East.
Statewide, 12 developments totaling nearly 700 affordable rental apartments will be added across Illinois as a result of the federal tax credits that will create $117.6 million in private equity. Demonstrating the State of Illinois’ dedication to creating more supportive housing opportunities, more than one-third of the total units will help veterans and people with disabilities find stability in communities.
As the state housing finance agency, IHDA awards the federal low-income housing tax credits (LIHTC) through a competitive process to finance qualified affordable housing developments. Under Governor Pat Quinn, IHDA has allocated federal tax credits generating $657 million in private investment to support the creation and rehabilitation of 8,550 units of affordable housing. With the board’s approval Friday, developers will now seek private investment for the new developments. Construction is expected to begin by next spring.
“Governor Pat Quinn is dedicated to leveraging public-private partnerships to meet the affordable housing needs of working families, seniors, veterans and people with disabilities,” said IHDA Executive Director Mary R. Kenney. “This financing will ensure the long-term affordability of apartments serving Illinois residents, helping to ease the cost of housing. These new developments also will create quality construction jobs to advance our economy.”
Congress created the federal tax credit program in 1986. Federal tax credits generate private investment in affordable housing when the credits are sold to private investors. The equity generated reduces the debt that the developer would otherwise have to borrow. As a result of the lower debt, a tax credit property can offer lower rents. Developments financed with tax credits serve households earning 60 percent or less of the area median income, or $29,580 for a one-person household in the St. Louis area.
Developments approved for financing include permanent supportive housing for veterans at risk of homelessness. Supportive housing empowers people with disabilities in communities by providing the services they need to live independently.
A development of 46 single-family rental homes for working families will be built in East Alton, and will offer a unique program allowing tenants to lease-to-own. The Northtown Apartments, a 16-unit development for people with special needs, will be constructed in Sparta (Randolph County).
A complete list of the 12 developments approved for financing is available at www.ihda.org/developer.
About the Illinois Housing Development Authority
IHDA (www.ihda.org) is a self-supporting state agency that finances the creation and the preservation of affordable housing across Illinois. Since its creation in 1967, IHDA has allocated more than $11.1 billion and financed approximately 221,000 affordable units across the state.