Date: March 16-18, 2007
Location: Minneapolis, Minnesota
Chair: John K. McIlwain, Thomas Murphy
Subject Area: Disaster Recovery, Economic Development, Sustainable Development
- The redevelopment of the Mississippi Gulf Coast will be the legacy of today’s officials and citizens. The Gulf Coast Renaissance Corporation enlisted ULI’s help in creating a set of recommendations to help it maximize its efforts on the Gulf Coast. ULI convened a panel of 15 national housing experts with the following objectives:
- To provide a formula and framework for the use of CDBG funds, private funds, LIHTCs, NMTCs, and other funds in an effort to maximize the number of workforce housing units produced and to ensure that the development of these units reflects the best and most responsible land use practices in the creation of sustainable communities;
- To provide a framework for the structure of the corporation, to maximize the efficiency of delivery of the programs while ensuring the integrity of the programs and underwriting process;
- To engage other entities to ensure complementary efforts by strengthening existing programs and offering programs that are not currently in place; and
- To ensure fairness and transparency in the process.
Despite the provision of billions of dollars in federal recovery aid for the Gulf Coast, the combination of insurance, construction, and labor costs has made rebuilding prohibitively expensive for many working families. The focus of the Gulf Coast Renaissance Corporation —a private, not-for-profit organization—is removing barriers to the reconstruction of permanent workforce housing in the three coastal counties of Mississippi. The Urban Land Institute (ULI), at the request of the Renaissance Corporation, formulated a strategy by which the corporation can leverage $100 million in Community Development Block Grant (CDBG) monies with private investment and private donations to effect the development of approximately 10,000 units of housing, or $2 billion in total development. The panel’s recommendations are outlined here:
- Employer-Assisted Housing Program The employer-assisted housing (EAH) program would assist at least 1,000 new and existing homeowners who are at or below 120 percent of area median income (AMI). The program would bring the cost of homeownership within the reach of families employed by participating companies by providing an average of $70,000 per family in assistance, through a combination of a forgivable mortgage funded by employer contributions and a silent mortgage funded by CDBG monies leveraged with New Markets Tax Credits (NMTCs).
- Gap Financing for Homeowners The gap financing program is geared toward assisting 1,000 homeowners earning less than 100 percent of AMI who need assistance to rebuild beyond that provided by programs such as the state’s Homeowner Assistance Grants.
- Rental Program In the rental program, $15 million in CDBG monies would be set aside first to make grants to projects that have been awarded Low-Income Housing Tax Credits (LIHTCs), to transform them into mixed-income rental developments. A further $5 million would be used to complement the state’s Small Rental Program by providing predevelopment, acquisition, and construction financing.
- Site Acceleration Fund A $48 million fund for land acquisition would be created with $8 million in private equity, $20 million in credit from local lenders and Fannie Mae, and $20 million in CDBG monies. After reviewing current community development plans, the Renaissance Corporation would use the Site Acceleration Fund to acquire parcels with potential for corridor projects, flagship mixed-use projects, and infill development. Approximately 3,000 units of housing would be developed on the land acquired under this program.
- Renaissance Builder/Developer Guild The Guild would certify members who commit to achieving specific standards in their developments in key areas: energy, wind, sustainable design and construction, and mixed-use and mixed-income development.
- Developer Assistance A $4 million fund would be created with private donations to provide predevelopment loans to developers.
A further $4 million in private funds would be set aside to enhance credit for acquisition and construction loans. NMTCs would be used to create the Small Developer Loan Fund to provide acquisition, predevelopment, and development funding to small developers building between 5 and 20 units of single-family housing.