Low-Income Housing Developers Seek City Council’s Blessing

City Council will be asked to give it support in a resolution to seven low-income housing projects in Tuesday’s meeting.

The projects are all vying for nearly $2.5 million a year, for the next 10 years, in regional tax credit dollars.

The chosen projects are from three different federal and non-profit developers.

They were selected for recommendation by the City’s Community and Human Development department.

The rules for developers applying for the tax credit changed this year. The award of the tax credits is based on a point system. The applicants scoring the highest number of points, out of a possible 177 points, would get the award.

For the first time, local government support is a category. The maximum number of points from this category is 17. Though it may not sound like 17 points could be the “deal breaker” for a project. Insiders say it certainly could turn out that way.

This is why developers have been lobbying City Council for months, informing the dais of each project, with the hopes of receiving Council’s blessing.

Some developers believe that in order for City Council’s support to have an impact, it should only be given to a single developer.

“Really, for the City to have any weight, you need to give it to some and not others,” HACEP CEO, Gerald Cichon said. “Because whether you give it to everybody or nobody, it has the same net effect.”

The Housing Authority of the City of El Paso has five low-income housing projects selected for recommendation to City Council; the El Paso Community Foundation’s Artspace project was also recommended as well as the Evangelical Lutheran Good Samaritan Society’s Good Samaritan Towers project.

The proposed Artspace project did not receive the tax credit last year and proponents are trying again. Community Foundation CEO Eric Pearson says they have reworked some of the construction plans and the non-profit’s new application is more competitive.

“What this does is allow for specific projects to receive an advantage based on community will,” Pearson said. “It does not detract from another project’s ability to earn points, except that they do not get those points based on the will of the community and the support of the community at large.”

Artspace is proposed to provide low-income housing to qualified artists who would live in downtown. Proponents of the project say the complex would further add to the revitalization efforts in the area and help to energize downtown.

Critics of Artspace say they do not believe the tax credits should be awarded to a project that supports individuals who choose to live an impoverished lifestyle. Critics maintain that being a “starving artist” is a choice, but residents of public housing are there out of necessity, not by choice. Many people do not agree with that argument.

City Council is expected to hear the recommendations and lend its support Tuesday afternoon.

Developers say the government tax-credit award can be sold to third parties for cash. The sum total of the 10-year-award, nearly $25 million, could be sold for approximately 80-cents on the dollar if a developer chooses, they say.