Written by Douglas Edwin
Thursday, 26 December 2013 15:00
Governor Pat Quinn has recently announced that more than 1,470 affordable apartments and homes will be built or rehabbed in cities around the state.
The push for the creation and rehabilitation of affordable homes is part of Governor Quinn’s agenda to make sure working families, seniors, and people with disabilities have affordable housing.
“Easing the cost of housing for hard-working families, seniors and people with disabilities is a priority in Illinois.” Governor Quinn said. “We must do everything we can to both increase and preserve quality affordable housing to help working families achieve housing stability and create thousands of jobs.”
The new housing had financing approved from two sources, the federal low-income housing tax credit and the Illinois Housing Development Authority’s (IHDA) Preservation Now program.
The IHDA’s Preservation Now program was started in March of this year to ensure affordable housing is available to those in need.
“Governor Quinn recognizes the need to preserve safe and decent affordable rental housing for the people of Illinois.” Mary Kenney, IHDA Executive Director, said of the program.
The funding from the Preservation Now program will go to preserving 450 units of affordable housing for working families and seniors in six separate developments located in Southern Illinois, Peoria, and the Quad Cities.
The financing from the federal housing credit will go towards the construction of 1,021 units of affordable housing in 16 developments in Chicago, Metro East, Springfield, and Peoria.
In addition to providing affordable housing for those in need, the new housing is expected to support around 2,400 jobs across the state, as well as help spur economic activity through local real estate tax and revenue.
With construction on the new housing expected to begin by next spring, developers will now seek private investment for the new developments.
“Governor Quinn is a strong advocate for leveraging public-private partnerships to meet the affordable housing needs of the state’s low- to moderate-income residents.” Kenney said. “The Housing Credit and Governor Quinn’s Preservation Now program effectively safeguard the affordability of these developments for decades.”
The federal housing tax credit program was created by Congress in 1986 to promote the development of affordable housing, and has been very productive since its’ creation. It works through the sale of federal housing credits to private investors to generate equity. The equity reduces the need for the developer to borrow money for the development, which saves money and allows for lower rents.
This is only the second round of funding for the newly created Preservation Now program, but it has already shown to be effective. Last month financing was approved to preserve 600 affordable rental units for seniors and people with disabilities in Chicago and Peoria, which is estimated to create around 500 jobs.
Over the next 20 years approximately $245 million in project-based rental subsidy will be preserved as a result of the Preservation Now program. Funding for the program is largely provided through the Illinois Affordable Housing Trust Fund, which is generated from half of the state real estate transfer fee.
To qualify for the new affordable housing, residents must earn at or below 60 percent of the area median income.
Last Updated on Thursday, 26 December 2013 15:01