Whatever the Texarkana City Council decides Monday night when it takes up a request for support for two low-income apartment complexes in PleasantGrove, it won’t be the end of the game.
It won’t even be halftime.
Pre-game festivities don’t begin until Jan. 9. That’s when a preliminary proposal from developers MVAH Partners, the firm proposing to build federal tax-credit supported complexes on Summerhill Road and Cowhorn Creek, is due at the Texas Department of Housing and Community Affairs.
A completed proposal, which also must include statements of support from local government, neighborhood groups and State Rep. Gary VanDeaver, isn’t due in Austin until March 1.
If the application makes it that far, TDHCA will schedule regional hearings, probably sometime in May, at which public comment will be accepted. That is when the agency usually hears comments, if any, from state and federal officials. Since the money comes from the IRS, the state agency is attentive to member of Congress at that time.
Final decisions are announced in July. In 2018, the agency funded 64 projects with an estimated value of $76.6 million, which accounted for 4,997 units.
To be sure, a lot happens between January and March. The developer will begin to make major investments. Engineers and architects will draft formal site plans and an environmental impact study must be done. Financial assumptions will undergo close scrutiny.
With so much money on the table, will a thumbs-down Monday night kill the proposals? Maybe. Public opposition to these proposals, especially when built outside low-income areas is common, but the process offers incentives to build anyway.
The rules governing these projects are gathered in what is known as the Qualified Allocation Plan, commonly
The plan gives a 30-percent boost to projects sited in a Qualified Census Tract, defined as a tract in which fewer than 20 percent of housing units are not Housing Tax Credit Units.
According to censusreporter.org, this 6.5 square-mile tract is home to 7,130 people and 3,248 households — none, presumably, built with federal housing tax credit dollars. It sits in TDHCA’s Region 4 and its demographics place it near the top of the program’s eligibility profile. Only two tracts in Tyler have higher rankings.
On top of that Region 4 is at the top of TDHCA’s list in terms of eligibility. Amounts given are credits per year.
Result of Supreme Court Case
Driving this preference for upper-income siting is a 2014 Supreme Court Ruling in a Dallas case, TDHCA vs. Inclusive Communities Project, Inc. In a 5-4 decision, the court upheld a ruling that the agency’s tax-credit funding practices was discriminatory because it resulted in most of these projects being located in low-income, minority areas.
At trial, the lower court found that TDHCA had distributed tax credits in an “objective, transparent, predictable, and race-neutral manner.” However, it said that TDHCA was not able to prove that less-discriminatory alternatives could be found. Thus was born the Qualified Census Tract.
A Harvard Law Review discussion of the case can be found here.
That scoring advantage does not, however, assure the project will be built. The QAP employs a lengthy and complex system of scoring. Support from a municipality, for example, is worth 17 points. A statement of non-opposition is worth 14.
Community involvement is worth eight points, as is a statement from a recognized neighborhood association. A statement of support from a state representative is worth eight points. A statement of disapproval from a representative, however, mandates a deduction of eight points.