By Joshua Burd
The state has awarded its latest round of funding under the federal Low Income Housing Tax Credit program, allowing developers to generate an estimated $270 million in private equity in support of more than 1,400 new affordable housing units in New Jersey.
The New Jersey Housing and Mortgage Finance Agency announced Wednesday that it has allocated $28.1 million in 9 percent tax credits for 2018. The subsidies will support 22 projects in 12 counties, ranging from a supportive housing development in Glassboro to a proposed mixed-income high-rise in downtown Newark.
Combined, the project represent nearly $479 million in development investment and will create thousands of construction-related jobs, generate additional tax revenues and boost local economic activity, the HMFA said. With the highly competitive 9 percent LIHTC awards, developers can sell the tax credits to investors who provide private equity to fund construction.
“Investing in housing that is affordable in New Jersey is the most important thing we can do to help individuals, families and seniors of mixed income levels be able to afford to live in this state,” said Lt. Gov. Sheila Y. Oliver, who also serves as commissioner of the Department of Community Affairs and chair of the HMFA’s board. “These vital tax credits help keep our commitment to the goal of producing housing that meets the diverse needs of our communities with the added benefit of producing thousands of jobs across the state.”
As the administrator for program, the HMFA awards the tax credits to developers to build new rental apartments or rehabilitate existing rental units for low-income households. Investors who buy the credits receive a dollar-for-dollar reduction on their federal tax returns for 10 years.
Since its creation in 1986, the LIHTC program has created some 3 million units in New Jersey, according to the HMFA. The agency estimates the 2018 round of tax credit awards will result in more than $759 million in one-time economic output, while the projects will produce more than 4,500 full-time jobs during construction and some $27.8 million in state and local taxes.
“Through this award of tax credits, developers can leverage $270 million in private equity to help finance the development of affordable housing and improve the lives of thousands of residents,” said Charles A. Richman, the HMFA’s executive director. “This program has been key to our efforts to expand affordable housing and invest in communities across the state.”
Once completed, the projects will support nearly $85 million in economic output, 479 full-time jobs and some $4.8 million in state and local taxes annually, the HMFA said.
See below for information on the projects awarded tax credits in the 2018 round.HMFA LIHTC