(AUSTIN) — With an eye towards providing reasonably priced rental housing for the state’s growing workforce and senior populations, the Texas Department of Housing and Community Affairs (TDHCA) today awarded $42 million in tax credits to support the construction of affordable rental housing developments across the state.

“Seniors and working Texans need an affordable place to live and we are committed to supporting the housing opportunities they require to continue working and contributing to their community,” explained TDHCA Executive Director Michael Gerber. “New tax credit developments are great economic generators for local communities and, once completed, will provide high-quality, stable, and secure homes.”

A total of 53 awards were made from TDHCA’s highly competitive 2007 Housing Tax Credit Program. The Department annually receives nearly twice as many applications as it can fund, demonstrating the high demand for these needed developments. Through these awards, TDHCA estimates creating 4,837 units statewide of affordable rental housing serving households earning no more than 60 percent of the area median family income.

The Housing Tax Credit Program is the nation’s primary means of directing private capital toward the development of high quality affordable rental housing.

The tax credits provide developers and investors with a benefit that is used to offset a portion of their federal tax liability in exchange for the production of affordable rental housing. The value associated with the credits allows units in tax credit properties to offer leases to income eligible tenants at rents below those of market rate apartment properties.

(AUSTIN) — The Governing Board of the Texas Department of Housing and Community Affairs (TDHCA) on July 28 approved the 2006 Housing Tax Credit Program allocation, awarding $48.9 million in federal housing tax credits to 73 applicants. The Department estimates that these credits will help create 6,899 units of affordable rental housing serving households earning no more than 60 percent of the area median family income.

The allocation included nearly $5.2 million in forward commitments from the 2007 credit pool the Board made to seven applications in this year’s round. A complete list of all developments receiving tax credits in the 2006 allocation cycle is located online at: www.tdhca.state.tx.us/lihtc.htm. According to Michael Gerber, TDHCA Executive Director, events in 2005 made this year’s allocation round a challenge.

"The cost of building materials has increased sharply as a result of Hurricanes Katrina and Rita, and the Department recognizes the impact this has had on the development community," Gerber said. "We are heartened that so many developers continue to participate in the program, even with these higher expenses. TDHCA tried to issue credits in amounts that reflected the higher cost of doing business in this year’s tax credit cycle.

"However, we also strive to achieve a wide geographic dispersal with tax credits and make a positive impact on as many communities in Texas as possible," he continued. "The challenge is to allocate these resources to as many applicants as possible while awarding only as many credits as necessary to make each application financially feasible. This is the difficult balancing act we had to carry out, and I am confident that TDHCA accomplished this goal."

The Housing Tax Credit Program is the state’s primary means of directing private capital toward the development of high quality affordable rental housing. Created by the Tax Reform Act of 1986, the program is governed by Section 42 of the Internal Revenue Code. The current code allocates housing tax credits in the amount of $1.80 per capita for each state.

The tax credits provide developers and investors with a benefit that is used to offset a portion of their federal tax liability in exchange for the production of affordable rental housing. The value associated with the credits allows units in tax credit properties to offer leases to income eligible tenants at rents below those of market rate apartment properties.

The program has helped create or retain over 114,000 units of safe, decent, and affordable rental housing for low income Texans since the first allocation cycle in 1987.