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Trends during the last 50 years have led to single-use housing subdivisions with homes in a limited price range. Neighborhood revitalization and growth management strategies encourage mixed-use, walkable communities with housing for people with different incomes. This approach leads to diverse new communities, avoids gentrification as downtowns revitalize, and helps communities enhance their neighborhoods and leverage existing infrastructure. Development that provides for a balance of jobs and affordable housing also reduces commuting time. States can use financial incentives to draw people to mixed-use communities, and to encourage developers to offer a range of housing choices.
Growth and Quality-of-Life Tools and Strategies
Indiana - Planning for Affordable Housing
The Indiana Housing Finance Authority developed the Foundations Program to fund planning activities related to the development of affordable housing. Housing needs assessments and feasibility studies are two of the four types of activities that can be undertaken with program funds. Assessments are used to gather data, prepare housing-related community plans, and identify actions that need to be taken to create, develop, or preserve affordable housing. Local governments may apply for grant funding to undertake these assessments, which are not specific to a particular site or housing activity. Feasibility studies are specific to a site or activity and are similar to market studies. Through these studies, applicants can, for example, identify a site for a particular project, develop preliminary cost estimates, and identify whether there is sufficient demand for a particular housing type. Only local governments are eligible to apply for program funding for this type of activity.
Indiana Housing Finance Authority, 317/232-7777
Maryland- Stabilizing Neighborhoods and Encouraging Economic Diversity
The Maryland Department of Housing and Community Development's Live Near Your Work program aims to encourage employees to buy homes near their workplace. The program provides a minimum of $3,000 - $1,000 from the state, $1,000 from the local jurisdiction, and $1,000 from the employer - to buyers who purchase homes in designated neighborhoods and live there for three years. There are no income restrictions for program participants. The local jurisdiction designates neighborhoods, with the department?s concurrence, and administers the program. Participating employers, which include businesses, nonprofit organizations, colleges, universities, and government agencies must set eligibility requirements, promote the program to their employees, and provide matching funds.
Maryland's Live Near Your Work Program, 410/209-5807
Missouri - Providing Tax Credits for Housing in Established Neighborhoods
In July 1999, Missouri adopted legislation to promote the purchase of homes in urban areas. The Neighborhood Preservation Act provides tax credits to encourage rehabilitation of older homes and construction of new ones in urban centers and established suburbs in moderate-income neighborhoods. Program eligibility is based on property location. "Level 1 neighborhoods" have household incomes between 70 percent and 90 percent of the metropolitan area median; "level 2 neighborhoods" have household incomes below 70 percent of this median. The act provides for a 25-percent tax credit for rehabilitation and a 15-percent tax credit for construction of new housing at both levels, though the maximum credits awarded vary by category. In addition, level 2 neighborhoods are eligible to receive a 35-percent tax credit for substantial property rehabilitation. Each category may receive $8 million in tax credits per year.
Missouri Department of Economic Development, 573/751-4962
Oregon - Rewarding Affordable Housing Development
Oregon's affordable housing program consists of statewide housing planning goals implemented through local comprehensive planning and grants and tax credits implemented by the Oregon Affordable Housing and Community Service Department. Under state law, each city must accommodate needed housing types, such as multifamily and manufactured housing. In addition, statewide planning goals require local governments to inventory lands, project future land requirements, and zone accordingly to meet affordable housing needs. Grants and tax credits are distributed to individuals, lending institutions, developers, and nonprofit organizations. For example, the Oregon Affordable Housing Tax Credit Program enables lending institutions to lower their financing costs by as much as 4 percent for housing projects. The savings generated by the reduced interest rate must be passed directly to tenants. The department also provides tax credits and incentives to low-income homebuilders; offers low-interest loans to the elderly, the disabled, and low-income people; and supplies loan guarantees for construction or rehabilitation.
Oregon Housing and Community Services, 503/986-2000
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