Grace Garden To Provide ‘Housing First’

North Dakota Housing Finance Agency supports the development of Grace Garden, a YWCA residence that will serve 30 households at risk of homelessness, many of whom are transitioning from domestic violence. NDHFA awarded development assistance to the residence through the federal Low Income Housing Tax Credit, $672,500, and National Housing Trust Fund, $325,549, and the state’s Housing Incentive Fund, $500,000. On behalf of NDHFA, please access details of the project below. Questions can be directed to Sarah Mudder, NDHFA Communications and Events Coordinator, at smudder@nd.gov.

Description

• The YWCA Cass Clay’s mission is to eliminate racism, empower women, and promote peace, justice, freedom, and dignity for all. The YWCA carries out this mission through the pillar of empowerment, by helping women gain confidence as they recover from the damaging effects of poverty and violence. Each woman who comes to the nonprofit’s door is provided with the tools needed to transform her life. Without judgment, the YWCA offers safe shelter, food, clothing, childcare, education and employment services, health counseling, and transportation assistance on each woman’s personal journey to independence.
• Grace Garden: A YWCA Supported Residence will serve 30 households at risk of homelessness, many of whom are transitioning from domestic violence.
• The apartments will range in size from one to four bedrooms. Four of the one-bedroom and four of the two-bedroom units will be fully handicapped accessible.
• The YWCA will provide on-site supportive services for a minimum of eight hours daily. In addition to the service offices and workroom, property amenities will include an elevator, community room, laundry room and a playground.
• Grace Garden will be constructed on an in-fill lot adjacent to the Lutheran Church of the Cross in West Fargo, ND. The site is near shopping, church, restaurants, banking and is in close proximity to medical services.
• Construction will begin in summer 2018. It is anticipated that the project will be complete and ready for tenants in June 2019.

Affordability

• Eleven of the units will be reserved for households earning 30 percent or less of Area Median Income (AMI), two units for households earning 40 percent or less of AMI, six for households earning 50 percent or less of AMI, and eleven for households earning 60 percent or less of AMI. In Cass County, a two-person household earning 30 percent or less of AMI is considered to earn $19,920 or less.
• All of the rents are set at the current Housing Choice Voucher program payment standard limit for Cass County. To ensure affordability for extremely low-income households, the Housing Authority of Cass County has committed 30 Housing Choice Vouchers to the property for 15 years.

Funding Sources

• North Dakota Dept. of Commerce committed $250,000 from the Governor’s Community Development Block Grant Discretionary Funds for land acquisition, to enter into a long-term ground lease agreement with the Lutheran Church of the Cross.
• North Dakota Housing Finance Agency has committed $672,500 in Low Income Housing Tax Credits (LIHTCs), $325,549 from the National Housing Trust Fund and $500,000 from the Housing Incentive Fund. An Investor will syndicate the LIHTCs bringing more than $6 million in equity to the project.
• Gate City Bank will contribute $1.5 million over 12 years to cover the supportive housing services operational expenses.
• Gate City Bank is also providing $4.5 million in construction financing.
• Total project cost is $7.1 million.

Property Team

• YWCA Cass Clay and Beyond Shelter Inc. are the developers.
• YWCA Cass Clay will be the property owner and manager.
  

North Dakota Housing Incentive Fund

KEY MESSAGES

• The North Dakota Housing Incentive Fund (HIF) strengthens communities by providing affordable rental housing.

BACKGROUND

• HIF supports the development and preservation of affordable multifamily rental housing projects targeted to low- to moderate-income individuals and families and essential service workers (lower-wage public or private sector employees who provide an essential community service such as healthcare, law enforcement or education services).
• HIF is a state program established during the 2011 Legislative Session. It was reauthorized and funding was approved in 2013 and 2015. During the 2017 session, a sunset clause was removed, but no new funding was provided.

HOW IT WORKS

• HIF is capitalized in part by contributions from state taxpayers. Contributors receive a dollar-for-dollar tax credit for their contribution. Contributions can be targeted to a specific project, community or region.
• NDHFA is responsible for administration of HIF including the development of a Biennial Allocation Plan which defines the process by which funds are distributed. Compliance monitoring, Land Use Restriction Agreements and recapture provisions are utilized to ensure that rent levels remain affordable for the agreed upon time period.
• HIF dollars can be used for the production, preservation and rehabilitation of affordable multifamily housing.
• Financial awards are structured as a deferred payment loan with a minimum term of 15 years.
• Since HIF’s inception, NDHFA has allocated almost $89 million to 81 projects, leveraging more than $434 million in construction financing to support the development or rehabilitation of 2,500 housing units statewide.

National Housing Trust Fund

KEY MESSAGES

• The National Housing Trust Fund (HTF) is a dedicated fund intended to provide revenue to build, preserve, and rehabilitate housing for people with the lowest incomes.

BACKGROUND

• HTF’s primary purpose is to increase and preserve the supply of affordable housing for extremely low income (ELI) households, defined as those earning less than 30 percent of area median income, including homeless families.
• The fund was established as part of the Housing and Economic Recovery Act of 2008 and is supported by Fannie Mae and Freddie Mac.

HOW IT WORKS

• The U.S. Department of Housing and Urban Development allocates HTF dollars to the states by formula annually.
• NDHFA is responsible for administration of the program on behalf of the state including the development of an Annual Allocation Plan which defines the process by which funds are distributed and monitoring of HTF properties for compliance with program requirements
• HTF dollars can be used for the production, preservation, rehabilitation and operation of the ELI portion of a project.
• Financial awards are structured as forgivable zero-interest loans with a minimum term of 30 years.
• NDHFA made the first financial awards in 2016. Since then, six properties have shared $5.58 million supporting the development of 85 housing units for individuals and families who have experience homelessness or who are at risk of homelessness.

Low Income Housing Tax Credit

KEY MESSAGES

• The Low Income Housing Tax Credit (LIHTC) program is an efficient and effective tool for providing affordable housing for the people who need it the most.

BACKGROUND

• LIHTC was created under the 1986 Tax Reform Act. The program is the most successful affordable rental housing production program in history, accounting for 90 percent of the affordable housing units created in the U.S. today.

HOW IT WORKS

• The U.S. Treasury through the Internal Revenue Service oversees the program and issues guidance and regulations.
• NDHFA is the state’s program administrator, annually offering and allocating the credits to developers through a competitive application process and acting as a compliance specialist. Developers typically syndicate or form limited partnership involving investors who are willing to provide equity capital in return for the economic benefits generated.
• LIHTCs can be used to support the production, preservation or rehab of affordable rental housing.
• Financial awards are structured as forgivable zero-interest loans with a minimum term of 15 years.
• More than $40 million in credits have been allocated for the production or rehabilitation of more than 200 projects in 43 North Dakota communities. Through the sale of the tax credits, $450 million in private capital investment has produced more than 7,000 affordable units statewide.

About North Dakota Housing Finance Agency
NDHFA is a self-supporting state agency dedicated to making housing affordable for all North Dakotans. The Industrial Commission of North Dakota, consisting of Governor Doug Burgum as chairman, Agriculture Commissioner Doug Goehring and Attorney General Wayne Stenehjem, oversees the agency. More information about NDHFA and the programs it administers is available online at www.ndhfa.org.

Media Contact: 
Sarah Mudder
701-328-8056