(AUSTIN) — The Texas Department of Housing and Community Affairs (TDHCA) today announced that it will help finance the construction of a new affordable rental property in New Braunfels, expanding the housing choices of younger working families and senior citizens while providing a shot in the arm to the local economy.

TDHCA is providing a $1.9 million loan to private developers constructing the 80-unit Residences of Solms Village Apartments. In addition, the developers also received an allocation of housing tax credits from the Department, the sale of which will help generate an estimated $6.7 million in private equity financing.

“Expanding housing choice is critical to the Department’s mission,” said TDHCA Executive Director Tim Irvine, “and by working with the private sector, the state can produce housing that is both attractive and affordable to families who otherwise would have few housing options. And we are doing this all while creating a significant impact on the New Braunfels economy to the benefit of all residents.”

Citing figures from the National Association of Home Builders, Irvine said that the Department estimates construction on Residences of Solms Village may generate up to 98 jobs, $6.3 million in local income, and $661,600 in taxes and fees to state and local governments.

The loan portion of the financing package was made through the Department’s HOME Investment Partnerships (HOME) Program, a federal program administered by the U.S. Department of Housing and Urban Development. Through the HOME Program, TDHCA provides grants and loans to cities, counties, public housing authorities, and both nonprofit and for-profit entities which in turn work directly with low income residents at the local level.

The Housing Tax Credit Program is the state’s primary means of directing private capital toward the development of affordable rental housing. Authorized under the Internal Revenue Code, the program provides private investors with a benefit used to offset a portion of their federal tax liability on a dollar-for-dollar basis in exchange for their investment in the production of affordable housing.   

Once completed, Residences of Solms Village will primarily serve tenants earning no more than 60 percent of the area median family income, which for New Braunfels equals $36,480 for a family of four.