BATON ROUGE, LA - The Louisiana Housing Finance Agency has reallocated more than $18 million in tax credits from proposed housing projects whose developers were unable to show they had closed on their loans or completed financing to move forward. Jeff DeGraff, an agency spokesman, said LHFA had opened a new round of applications as the agency continues with its efforts to address a lack of affordable housing in Louisiana.
New projects have been vetted and the "recaptured" tax credits - those initially set aside for projects unable to get funding together in time to move forward - were assigned to projects the agency deemed feasible, he added. In all, the agency said its board allocated $31.3 million in tax credits. The total included some $18 million recaptured credits and credits previously returned or unallocated.
The tax credits include breaks created after hurricanes Katrina and Rita to encourage investment in the storm-battered region. Financing for redevelopment projects has become a concern amid the nation's economic turmoil and an ongoing credit crunch.
Economists have said that they believe rebuilding projects with government money attached to them - such as public buildings and infrastructure projects - should be OK. They said privately funded projects condos, housing, and new business development - could be affected by a contraction of credit.
Nearly 730 housing units planned for New Orleans were set aside because their developers could not show they had closed on their remaining financing. DeGraff said such projects aren't "dead or blackballed" and developers would still have an opportunity to apply for tax credits if they desired.
LHFA President Milton Bailey called the recent allocation of credits a "significant step in continuing the development of affordable housing in Louisiana." While some previously planned projects might not come to fruition soon, he said other "more stable and financially ready" projects should.
Source: LHFA