Housing First development planned for Ohio City does not receive tax credits necessary for financing
by Chuck Hoven
(Plain Press, May 2012) Plans by the homeless advocacy coalition Housing First to build permanent supportive housing for the homeless in Ohio City have received a setback. The Emerald Alliance VIII mixed-use facility, planned by Cleveland Housing Network (CHN) and Emerald Development & Economic Network (EDEN) for the corner of Fulton and Lorain Avenue, was not included in the announced winners of federal tax credits announced by the Ohio Housing Finance Agency in early April.
The plan called for building 55 efficiency apartments in the Ohio City neighborhood to provide permanent supportive housing for individuals that have experienced long term chronic homelessness. CHH and EDEN applied for the tax credits from the Ohio Housing Finance Agency to help raise $10 million to finance the project.
The Ohio Housing Finance Agency in denying the application indicated Emerald Alliance VIII was “removed for project cost concerns.” Kate Monter Durban, Assistant Director of the Cleveland Housing Network, says the OHFA chose a new way of evaluating the cost that put their project at a disadvantage. She says for the first time OHFA chose to use net residential cost – the cost per unit for the amount of residential space in the development. – to evaluate the proposal. Monter Durban says under this measurement, the Housing First Model is at a disadvantage because it provides a lot of common areas for residents and has smaller apartments. She said the Emerald Alliance VIII if compared on total development cost was “right on the money” in comparison to other proposals. Another way of measuring the cost is to compare the amount of federal tax credits the proposal asked for per unit, on that measure, Monter Durban says the Emerald Alliance VIII proposal was below or the same as the cost of the other proposals.
In announcing that the proposed development did not receive the tax credit award, Ohio City Executive Director Eric Wobser said, “Ohio City Incorporated and our neighborhood remain committed to the Permanent Supportive housing model as the best solution to address our problems and challenges associated with chronic homelessness.”
Monter Durbin says the Housing First coalition will begin a new planning process in the fall for next year’s proposals. She considers OHFA a partner in the process with a great track record of funding permanent supportive housing. She says OHFA has an interest in seeing more permanent supportive housing built and says the Housing First coalition will have policy conversations going forward on “how we can maintain the integrity of our model” and work in partnership with OHFA to build more permanent supportive housing.
While the development proposed for the Ohio City neighborhood did not benefit from the tax credit awards, a development proposed for the Detroit Shoreway neighborhood did receive funding for affordable housing. The Magnolia on Detroit Apartments, at 8016 Detroit Avenue in the Gordon Square Historic District was one of the recipients of the tax credits. Tax credits, totaling $1,047,059, were reserved for the Levin Group, Inc. to aid in the development of the 126-unit apartment building. Statewide, more than $29 million in tax credits were awarded to 37 affordable housing communities including five communities in Cuyahoga County. In this year’s funding cycle over 100 applicants submitted proposals requesting over $80 million in tax credits. The funding requested by applicants far exceeded the funds available for serving the affordable housing needs of families, seniors and individuals with disabilities.