Wednesday, April 22, 2009

Ordinances could help preserve 62 low-income housing units in Avondale

At its meeting this afternoon, Cincinnati City Council will consider two ordinances that could lead to the preservation of 62 new low-income housing units in Avondale.

The first ordinance would extend a 30-year, $1.9 million loan of federal HOME funds to Burnet Place Limited Partnership (Model Management) through the City's Rental Rehabiliation Program (RRP) at an interest rate of 3.67 percent.

The loan would be applied to the $12.5 million Burnet Place Project, consisting of the rehabilitation of seven buildings at 353 Rockdale Avenue, 3493-3495 and 3501 Burnet Avenue, 242 and 248 Northern Avenue, and 3642 Alaska Avenue, preserving 62 low-income housing units and creating over 8,000 square feet of commercial space.

Under terms of the loan agreement, the City would receive an annual debt service payment of 30 percent of operating cash beginning in the project's second year and would hold a second mortgage on the properties.

The ordinance is necessary because the RRP normally authorizes only forgivable deferred loans, and a 2007 council motion that requires council approval for all rental rehabilitation projects.

Units will be rented to households below 60 percent of the area median income (AMI), with 20 percent reserved for those with an income 50 percent below AMI.

Eleven of the units will be priced according to U.S. Department of Housing and Urban Development (HUD) Low Rent and High Rent HOME limits.

No tenants would be forced to move during the rehabilitation.

The second ordinance would transfer $470,903 from various HOME project accounts into the RRP account.

Additional project funding would come from bank loans, Low Income Housing Tax Credits, Ohio Housing Development Assistance Program funds, and developer equity.

The HOME program is HUD's largest block grant to state and local governments, allocating annually approximately $2 billion nationwide.