Virginia Housing Development Authority’s NoVA Preservation Initiatives

1. Virginia Housing Development Authority’s NoVA Preservation Initiatives Affordable Housing Advisory Committee December 16, 2005

2. Northern Virginia Housing Costs • In March 2005, VHDA’s Board approved a multi-faceted approach to help address the high cost of housing in Northern Virginia.

3. VHDA Board Actions • Proactively keep affordable multifamily units in VHDA’s portfolio. • Continue to actively partner with local governments and non-profits to address NOVA’s preservation needs. • Allocate additional low-interest mortgage monies and subsidy resources to address Northern Virginia’s increasing cost gap.

4. I. Keeping Units Affordable • VHDA proactively approaches its borrowers regarding refinancing and recapitalization of their properties in exchange for extended periods of affordability.

5. Example of Recapitalization • Hunting Creek – Fairfax Co. • Section 8 property financed by VHDA • FCRHA is working with AHD, Inc. to preserve this resource by: • Assumption of the existing VHDA mortgage • Extending affordability term by at least 23 years and restricting occupancy to 50% AMI • Completing a moderate rehabilitation with equity from the sale of low-income housing tax credits • Providing FCRHA with right of first refusal

6. II. Active Partnerships • VHDA continues to actively partner with local governments and non-profits to help carry out local preservation strategies. • Our participation on the county’s Affordable Housing Task Force and its implementation team are examples of how we support local affordable housing initiatives.

7. II. Active Partnerships • We are currently expanding VHDA’s REACH Team, part of our Reach Virginia initiative that underscores our commitment to fund housing challenges across the state. VHDA is hiring additional staff to both expand outreach to targeted populations as well as build partnerships with public and private organizations that address priority housing needs. And, we are currently recruiting for a REACH Team member who will reside in Northern Virginia and provide full-time outreach to the region. We expect that person to work closely with local governments and housing providers to develop and implement new affordable housing strategies.

8. II. Active Partnerships • VHDA has created a NoVA Advisory Board. • It serves as a forum to identify key regional housing issues and common areas of concern affecting Northern Virginia. • This Advisory Board serves as a proactive communication forum between developers, local governments, local RHAs, nonprofit housing providers and VHDA.

9. III. Allocating Resources • VHDA has allocated additional mortgage monies and subsidy resources to address Northern Virginia’s pressing needs. • We have created a non-competitive pool of tax credits for preservation projects in Fairfax County, Arlington, Alexandria, Fairfax City and Falls Church. The pool credits will be from the following year’s allocation, not to exceed 15% of current year’s per capita credits.

10. III. Allocating Resources • In addition, the geographic pool of tax credits for Northern Virginia remains at 19.44%. • New sources of VHDA loan funds are available: • $8 million of low-interest REACH Virginia funds that are tied to the non-competitive pool of credits; and • $10 million of REACH Virginia funding that will match local contributions at a very low (2%) interest rate.

11. 90/10 Program • VHDA has partnered with the Va. Foundation for Housing Preservation to create this new loan program that provides interim interest-only site acquisition loans to developers of low-income housing.

12. VHDA’s SPARC Program • VHDA’s SPARC program is intended to encourage innovative ideas and partnerships among local governments, housing authorities, non-profits and for-profit developers to create housing that is affordable to underserved populations with low incomes.

13. Importance of Mixed Income • VHDA has recently been granted authority by the General Assembly to finance mixed income developments. • Mixed income, together with increased density, have been important tools in making preservation in Northern Virginia feasible.

14. Examples of Preservation Tools • Madison Ridge Apts. – Centreville • 216 total units; 98 will remain affordable apartments • 118 will become condos • VHDA provided $2 million of matching 2% financing • VHDA also provided a $9.1 million tax exempt loan • Fairfax provided $8.3 million from its “One Penny for Housing” program • Developer – Wesley Housing

15. Examples of Preservation Tools 2. Gates of Ballston – Arlington Co. • More than 450 total mixed-income units • $30 million bond allocation from VHDA • $15 million first mortgage from VHDA • Developer – Arlington Housing Corp. (AHC)

16. Examples of Preservation Tools 3. Monterey Apts. – Arlington Co. • 109 affordable apartments • VHDA committed $6.3 million in taxable bond financing • VHDA allocated $1.5 million in SPARC program funds • Developer – Silverwood Associates

17. Examples of Preservation Tools 4. Sierra Condos – Arlington Co. • 90 new condominiums; 10 set aside • VHDA provided low-interest SPARC mortgage loans of 4.75% • Arlington Co. provided downpayment assistance • Developer – Silverwood Associates

18. Examples of Preservation Tools • VHDA is partnering with local governments and non-profits to help preserve the more than 5,000 affordable apartments for sale in Northern Virginia. (Winkler apartments)

19. VHDA is Highly Proactive • VHDA actively commits people, capital and the subsidies it administers to the affordable housing problem in Northern Virginia.