Affordable Housing Pros Optimistic Smaller F.C. Plan Will Win Credits

May 6, 2009 9:56 PM0 comments

The steep downturn in the global economy took its toll on the City of Falls Church’s affordable housing goals in the past year, delaying the efforts of the Falls Church Housing Corporation to submit an application for tax credits after hard-fought official approvals from City officials last winter.

Now, there is both good news and bad news in the report the Housing Corporation (FCHC) brought to a work session of the Falls Church City Council Monday night.

The good news is that the FCHC has found a new, well-seasoned non-profit partner of national renowned that is confident it can win the Virginia Housing Development Authority’s (VHDA) approval for necessary tax credits. Federal stimulus dollars and some relaxed application rules by the VHDA are also factors improving the City’s chances of getting a thumbs-up when its project is submitted on May 14.

The bad news is that the scale of the downtown project approved last December has been drawn down from 174 affordable housing units to somewhere between 120 and 130. Carol Jackson, executive director of the FCHC called the downsizing “a pretty disappointing radical change” to the wider financial problems plaguing the nation.

The Community Builders, Inc., is the new organization that has agreed to partner with the FCHC, represented at Monday’s meeting by its Mid-Atlantic Region Director Robert Fossi. The non-profit has a mission of assisting in the construction of affordable housing units nationwide.

“Frankly, they’ve helped us re-craft our submission to optimize its ability to win approval in this market,” Jackson told the News-Press yesterday. Dr. Steve Rogers, former vice-mayor of Falls Church who is now chair of the FCHC board, told the Council Monday that the relationship with Community Builders began only a month-and-a-half ago. Eric Hoffman, an attorney working with the FCHC, recommended the organization.

The new plan will involve two buildings, not three. Each building will be a separate submission to the VHDA. One will be dedicated to workforce housing, and the other to senior housing. Homestretch, Inc., the non-profit that is the current owner of one of the two existing buildings on the 360 S. Washington St. site, remains a partner with the FCHC, and will have its office space on the ground floor of one of the two new buildings.

A third building, owned by Tom Sawner, owner of EdOptions, Inc., included in the original plan, has no role in the new plan. That building was to provide a parking deck. Without it, the two buildings will require underground parking.

But City Councilman Dan Maller suggested Monday that City Hall might take the initiative to contact Sawner to propose a way to get back into the deal. Councilman Nader Baroukh concurred, saying the commercial component that the Sawner piece brought to the original plan made it far more attractive.

The FCHC and new Community Builders partners will take the authorizations won from the City Council last December to make their applications by the looming May 14 deadline. Among other things, they can do this given some relaxation in the rules imposed by the VHDA, given the economic climate that has shut down most affordable housing initiatives nationally.

Then, it remains to be seen what new authorizations may be required from the City Council once the applications are in. Fossi told the City Council that even if the senior housing building component of the plan fails, there are enough resources, including federal stimulus dollars, to get it built without the tax credits.

Under the new joint venture agreement between the FCHC and Community Builders, Community Builders will be the managing partner, including handling all the formal submissions to the VHDA. “They will do all the heavy lifting,” Jackson explained, while the FCHC will deal with the Falls Church community and government, and be a participant in all major decisions.

As Community Builders will be the guarantors of the debt incurred from the VHDA, it is required that they be signed on for 15 years. The organization hopes to get out of its participation the resources required to move on to other similar efforts.

Under the new plan, there are now no plans to change anything about the current Winter Hill senior housing arrangements.

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