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Philanthropy Delaware's Personal Meeting Room - Shared screen with speaker view
Logan Herring
We'll take it!
Sierra (she/her)
What’s the timeline for the project and how many homes (are they all single family homes?) are you looking to have developed?
Sierra (she/her)
^ referring to the catalyst fund
Mark McDaniel-Cinnaire (he,him,his)
Sierra the target is 100 units.
Matthew Heckles
It used to be...
Chris Crothers
Schlonn Hawkins, CEO & Publisher, Shelterforce
@Vincent White—Shelterforce explored some of the points you made in one of our series on the Racial Wealth Gap: https://shelterforce.org/category/racial-wealth-gap/
Schlonn Hawkins, CEO & Publisher, Shelterforce
Also our webinar Push Back on the Racial Wealth Gap
Schlonn Hawkins, CEO & Publisher, Shelterforce
Matthew Heckles
Asset building is a focus for us at HUD and, I think, is important in answering Mr. White's question. Too many of our programs have policies or regulations or law that make it difficult if not impossible to build an asset base that's needed to exit subsidized housing.
Matthew Heckles
Example - tenant portion of rent increasing with tenant household income making an incentive to not increase household income. What if we simply recertified household income every 3-years to buffer this?
Matthew Heckles
Matthew Heckles
And here is the PAVE report on appraisals - it's release has really started a much more robust national conversation than we had been seeing.
Matthew Heckles
Matthew Heckles
And, by the way, Melody Taylor was the key staff on this report... She's a Delawarean...
For Director Young and Matt Heckles, we seem to be seeing more requests to support and supplement the costs for tax credit developments. Is there a change in the financial models that requires this additional subsidy? Is there anything that could be done from a policy or federal level to get these developments to fruition, thereby freeing up those philanthropic dollars for other activities?
Eugene Young, Jr.
Hi iPhone--We are certainly using a portion of our ARPA funds to support LIHTC developments. This will be done through an arm our our Accelerator Fund. We want to target the "GAP" that occurs in many tax credit development deals. I apologize for forgetting to bring that up during my presentation.
Matthew Heckles
YES! A LIHTC capital stack question!!! So, it is probably simply a function of increased construction costs - which are very real. And, as Director Yound said, some of those costs come from community opposition. Though most are lumber, appliances, labor, etc.... I doubt the per unit TDC is much below $400,000 at this point when 10-years ago it was pushing the $200,000 line. The LIHTC hasn't changed much - the 9% type gets you about 40% of your TDC in equity and the 4% gets you about 20%. This administration has done a lot to increase the power of LIHTC and there are some good changes under consideration in Congress (Build Back Better would have helped) but we are looking for a vehicle.
Matthew Heckles
I actually think this is an area where Delaware needs to do more. We must unlock the 4% LIHTC program
Eugene Young, Jr.
Exactly the plan, we are focusing on using the funds to get more 4% deals done.
Matthew Heckles
That means increasing the subsidy to make up the difference between the 40% and 20% of TDC mentioned above. The State of Maryland had a state-funded program that was only intended to do this - it moved the LIHTC program from about 20 projects per year to over 40. We would take the 'losers' from the QAP and stack in the state funds to make them financially feasable with 4%LIHTC.
Matthew Heckles
Then, the only limitation is that subsidy as the 4% LIHTC capacity is unlimited. These large / phased / years-to-decades-long projects are essential (don't get me wrong) but in a state like Delaware with such limited 9% capacity we have to balance their needs with making sure that every other project isn't locked out. 4% LIHTC and Twinning the 9% and 4% are two solutions that will help.
Chris Crothers
Thanks everyone. Appreciate the speakers. I have to jump to a meeting.
Mark McDaniel-Cinnaire (he,him,his)
Appreciate all of you and all you are doing to make Delaware more affordable and equitable. It is an honor for Cinnaire to be part of those efforts. Thank you for putting this forum together. Excellent. I have to get to my next app
Philanthropy Delaware
Glad you could join us Mark. Thank you as well.
Kevin L. Smith
I apologize I have to leave as I am speaker for the Jump Start minority developers program that is happening this afternoon
Donna Gooden
Thank you everyone, there is so much wonderful work going on here in DE. I have to jump to my next meeting.
Sierra (she/her)
Thank you all for your presentations and commitment to this work!
Sean O'Neill
Very good point by Karen. Also some Census Tracts do not accurately describe those areas because there are pockets of poverty, which has historically been a problem in Sussex County
Ray Tuck WSFS Bank
Unfortunately I have to drop off the call. Thank you all for sharing such valuable information.
Rich Przywara - Woodlawn
Great session today, thank you for including me.