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HomeMy WebLinkAbout~Master - Low-Income Housing Tax Credit (LIHTC) Application for multi-family housing development in the Baker Subdivision (321 State Avenue) RESOLUTION NO. 22-123 RESOLUTION APPROVING PARTNERING WITH CURRENT DEVELOPER AS A 4% LOW-INCOME HOUSING TAX CREDIT (LIHTC) PROJECT AND LOCAL ASSISTANCE OF APPROXIMATELY $2.0 MILLION FOR THE CITY OF AMES,IOWA WHEREAS,at the December 22,2020,meeting,the City Council entered into a Partnership Agreement with Prairie Fire Corporation and Builder's Development Corporation(BDC)to submit a Low-Income Housing Tax Credit(LIHTC)application to the Iowa Finance Authority(IFA)for 37 multi-family housing units in the Baker Subdivision (321 State Avenue); and, WHEREAS, the partnership supported the City Council Goals to create more affordable housing for both ownership and rental households within the Baker Subdivision; and, WHEREAS, in late September 2021, staff learned that the 9% LIHTC application was not funded due to a large group of disaster set-aside projects that absorbed most of the funding allocation; and, WHEREAS, staff was informed by the developer that 4%LIHTC funds were available and that the Governor's priority was to allocate an additional$100 million to affordable housing that the State was eligible to receive through the US Treasury; and, WHEREAS,the additional State funding would have approximately equaled the original 9% LIHTC request if the final guidelines supported that approach;unfortunately,the final US Treasury guidelines did not permit for the State to use the funds as they had hoped; and, WHEREAS,the State is only using the funds for previously awarded 9%LIHTC projects and the City's submittal did not qualify for additional assistance; and, WHEREAS, the Agreement with Prairie Fire and BDC in December 2020 that was predicated on receiving a 9%LIHTC award is no longer valid and the City needs to determine how to proceed; and, WHEREAS, without a 9% LIHTC award and only an option to pursue a 4%LIHTC, there is an estimated funding gap of$2.9 million shortfall for a 100% affordable 37-unit project; and, WHEREAS, staff proposed the following options: 1) Submit for 2022 a 9% LIHTC application with the current developer;2)Partner with the current developer as a 4%LIHTC project and grant local assistance of approximately$2.9 million; 3)partner with the current developer as a 4%LIHTC project and provide local assistance of approximately$2.0 million;and,4)Request new Proposals. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Ames, Iowa, that the option of partnering with the current developer as a 4% LIHTC project and provide local assistance of approximately$2.0 million is hereby approved. ADOPTED THIS 8`' day of March, 2022. Diane R. Voss, City Clerk John A. Haila, Mayor Introduced by: Corrieri Seconded by: Betcher Voting aye: Beatty-Hansen, Betcher, Corrieri, Junck, Rollins Voting nay: Gartin Absent: None Resolution declared adopted and signed by the Mayor this 8th day of March, 2022.