Virginia Housing, a state agency, has published a list of applications from developers seeking tax credits to cover the cost of building apartments guaranteed to be rented to people with lower incomes than the area median.
The Internal Revenue Service allots a limited number of federal Low-Income Housing Tax Credits for each state, and Virginia Housing splits that amount into different pools. Each project is ranked according to a series of factors. Initial rankings will be published on May 15, and allocations to specific projects will be made in mid-November.
The Piedmont Housing Alliance submitted two candidates for LIHTC and Preservation of Affordable Housing submitted one for its project at 1000 Wertland St.
“LIHTC is the bedrock of a subsidy that reduces the size of a mortgage on the property,” says Sunshine Mathon, PHA’s executive director. “A property with limited income due to reduced rents still has operating costs in addition to debt payments.”
PHA has requested 40 units at 501-A Cherry Ave. through the Accessible Supportive Housing Pool for a total annual tax credit of just under $1.7 million. If granted, the organization will sell those tax credits to a third party to make up the gap between the $23 million development cost and the $8.6 million available in funding.
The four-story building will include 14 studio apartments, 23 one-bedroom units, and three two-bedroom units. Construction would be completed by March 31, 2027, according to the application. Half of the units are reserved for households with annual incomes below $74,520 and the other half will be reserved for those with lower income levels.
Neighborhood Development Services approved the 71-unit site plan on March 7, a step that increases a project’s score. The City of Charlottesville is contributing $3.15 million to the project, which boosts its ranking too.
PHA also submitted an application for a portion of the third phase of the redevelopment of Friendship Court into Kindlewood. Its application from the Preservation pool seeks $2.2 million to help subsidize 55 units. The city is contributing another $3.15 million for this project, and anticipates spending another $4.5 million on the fourth phase.
The four-story building would include nine one-bedroom units, 35 two-bedroom units, and 11 three-bedroom units. NDS approved this project on March 4, according to the application. The sale of tax credits would finance a gap between the $32.58 million development cost and the $13.87 million in grants and other funding.
Preservation of Affordable Housing’s application is for some of the units in a six-story building planned for the corner of 10th and Wertland streets. The nonprofit is seeking just over $1.35 million in tax credits to cover 39 of the 180 proposed units, and plans to subsidize the remaining 141 units through the sale of tax-exempt bonds. Those applications are due May 1.
Construction is expected to be complete in October 2028, according to the application.
The Piedmont Housing Alliance has submitted two candidates for low-income housing tax credits. “LIHTC is the bedrock of a subsidy that reduces the size of a mortgage on the property,” says Sunshine Mathon, the nonprofit’s executive director. Supplied photo.
