City could begin disbursing affordable housing funds later this year
Under a plan discussed this week, the city will use bond proceeds, rather than general fund revenue, for the trust fund and dedicate nearly $20 million to help fund more than 370 affordable units.
Two years after voters approved the measure, New Orleans’ multi-million dollar affordable housing fund — known as the Housing Trust Fund — is poised to start distributing its first installments of money. Under a plan discussed during a Tuesday (April 28) meeting of the advisory committee that oversees the fund, the city would dedicate $19.8 million to bolster six multifamily affordable housing developments this year, including at least one that stalled after an $8 million shortfall put its gap financing from the city at risk. Schwartz said that the six deals — which include the Mazant-Royal, Esplanade Delille, Baronne Lofts, BW Cooper, Gold Seal and Meridian developments — will collectively deliver more than 370 affordable apartments in New Orleans. Because of the city’s ongoing budget crisis, the plan calls for the funding to come from bond proceeds rather than recurring dollars from the city’s general fund, at least for its first year. There wasdebate among some affordable housing advocates last fall — when voters were considering whether to approve the sale of a $45 million bond for affordable housing — whether the bond would ultimately be used to backfill the Housing Trust Fund. Approved as a 2024 charter amendment, the Housing Trust Fund was pitched as a stable, recurring pot of local money — an amount that is equal to least 2% of the city’s general fund each year — that an advisory committee would steer toward affordable housing projects, independent of one‑time grants or annual budget cuts. Some critics worried that once voters approved $45 million in borrowing, the city might lean on bond proceeds rather than setting aside 2% of its own general fund. Supporters, including District B Councilmember Lesli Harris, argued the bond was intended to help finance larger multifamily projects that the annual trust fund alone could not sustain. Voters ultimately approved the bond proposition. “I want to acknowledge that that is not a situation that anybody wanted or hoped for, but it is simply a recognition of the pragmatic reality of where we are today as a city,” said Jeff Schwartz, the city’s director of housing, community development and special projects at Tuesday’s meeting. “The elephant in the room that I just want to acknowledge is that the city does not have general fund dollars in order to be able to fund this right now. Anybody who’s been reading the news knows that to be the case.” According to Schwartz, the current plan is to sell $32 million in bonds, or about 70% of the $45 million approved by voters, this summer — and combine that with $4 million in re-obligated older bonds for a total of $36 million for affordable housing this year, more than the roughly $14.6 million the Housing Trust Fund initially expected to receive. The administration’s proposal is to then use that $36 million for a two‑track strategy: First, fully funding the Housing Trust Fund at $16 million this year — splitting that money between initiatives dedicated to affordable homeownership, rental supply expansion and rental preservation, as well as administrative costs — and then using the remaining $19.8 million to bolster six multifamily affordable housing developments. The administration will then use the remaining $13 million in affordable housing bond money, the last 30% of the $45 million approved by voters, to fund the Housing Trust Fund in 2027. That $13 million will be divided between three multifamily developments, which will receive approximately $10.5 million, and other affordable housing initiatives, which will receive $2.5 million. The advisory committee is not being asked to vote on the bond deployment plan yet. According to co-chair Maxwell Ciardullo, a vote from the Housing Trust Fund committee is likely to come in May. But Schwartz noted that the New Orleans City Council earlier this month approved an ordinance to allow the city to enter into a cooperative endeavor agreement with the New Orleans Redevelopment Authority and Finance New Orleans, to administer Housing Trust Fund dollars. “We are now finally at long last at a point where we can now get those dollars out the door and really operationalize it,” Schwartz said.Read the full article on Veritenews.org.
