Highlands Residential Services faces competition from eight other housing authorities for tax credits on the Magnolia Ridge project.
Consultant Alvin Nance told the Highlands Board of Directors Thursday a total of 49 applications submitted. Nance said he believes the board’s application is strong.
“So the category that we are in is a RAD (Rental Assistance Demonstration), new construction, and a CCRP,” Nance said. “We are in a CCRP (Concerted Community Revitalization Plan), the city has been providing that letter to us previously on the other deal, so we got everything we need to be in that area, and I think we got a good unit capital.”
Nance said the application does have some competition from Johnson City. Nance said Johnson City has been coy about providing information, but he still believes the Highlands application is ahead.
“They haven’t done a tax credit application in probably four or five years,” Nance said. “So that could come into play, to our favor, cause you could lose some points on paper.”
Nance also said that their application is proposing 72 units while Johnson City is proposing 96 units. Nance said with proposing fewer units, the board does not want to get into a tiebreaker with Johnson City.
Nance said Johnson City wants to build on a portion property that is still under a HUD declaration of trust. Executive Director Chris Cassetty said that could help the board’s application.
“When THDA determines who there high-scoring applications are, they do what’s called a cure notice,” Cassetty said. “It’s basically, hey, we’ve got these issues, and you’ve got 30 days to cure these issues, and so what Alvin is saying is the fact that they don’t have site control would certainly be an issue on the cure notice, and it’s very possible that they couldn’t, even if they score better than us they might very well not be able to cure there issues and then THDA would go on down the line.”
Nance said the total amount of funding available is $72 million. Nance said the board applied for an estimated $18 million. Nance said being awarded tax credits is important from the standpoint of the momentum that HRS has right now.
“You know, you’re finishing the project of Hickory Valley, you’re starting the project of Red Bud Village, you could be transitioning or ending the project of Red Bud Village about the time we are getting started on Magnolia Ridge, if we are awarded the credits this year,” Nance said. “So from a timing standpoint, it really falls in line good.”
The Highlands Residential had applied for tax credits last year but was surprisingly edged out by Oak Ridge. Nance said not every application submitted will receive tax credits. Nance said he expects to hear back from THDA about awarded applications in two weeks.
Nance said most of the housing authority applications that were submitted are in a different category.
