State housing agency allocates $60.1 million in tax credits; financing tool to create 5,400 units of affordable housing

(AUSTIN) — The Texas Department of Housing and Community Affairs (“TDHCA”) has awarded $60.1 million in housing tax credits to private developers constructing or rehabilitating 65 rental properties across the state offering units with reduced rents.

The awards, made through the state housing agency’s 2014 Housing Tax Credit Program allocation cycle, is expected to help finance 5,407 affordable rental units, increasing housing options for individuals and families earning no more than 60 percent of the area median family income.

“The Housing Tax Credit Program is increasingly important to the state’s growing numbers of young working families, as it expands the housing choices for these households while offering them a path to improved living standards,” according to Tim Irvine, TDHCA Executive Director.

Irvine explained that the Department, through its rule making process, encourages the development of tax credit properties in neighborhoods with lower levels of poverty and served by high performing schools, the goal of which is to provide tenants access to resources that might otherwise be unavailable to them. 

“The program is also a key tool for developing safe, decent rental housing for older Texans living on fixed incomes, another segment of our population growing at a rapid rate,” he continued. “Through this program we are creating housing that is both attractive and affordable to families who otherwise would have limited housing choices and equally limited futures.”

Besides bringing greater stability to low-income individuals and families, the construction payroll salaries, local purchases, and taxes and fees the program generates ensures that the entire state will benefit from today’s award. TDHCA anticipates that this year’s credit allocation could have as much as a $549.2 million impact on the state’s economy.

The federal Housing Tax Credit Program is the state’s primary means of directing private capital toward the development of affordable rental housing. Developers and their investment partners use the credits to offset their federal tax liability on a dollar-for-dollar basis in exchange for the construction or rehabilitation of rental units offering a reduced rent.