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Housing staff lay out tax‑credit development basics and city‑owned-site suitability
Summary
Housing staff reviewed how low‑income housing tax credits (LIHTC) work and presented a city‑owned vacant‑lot analysis aimed at accelerating infill affordable housing; staff said 113 city‑held lots can be used for affordable housing but 15 were not suitable without remediation or assemblage.
Housing and Community Development staff briefed the council on tax-credit development mechanics and on a city inventory of vacant lots that could support affordable housing.
What staff explained: Director Emily Dutton and staff said the Low-Income Housing Tax Credit (LIHTC) program is the primary source of affordable rental production in the U.S. Staff reviewed the difference between 9% credits (more subsidy, competitive) and 4% credits (less subsidy, generally non‑competitive when paired with tax‑exempt bonds) and explained the city’s “4% gap‑financing” program that has supported a higher production of affordable units in recent years.
City‑owned sites and suitability: Staff presented an inventory of city‑held parcels acquired through prior housing bonds and other actions. They reported 113 vacant lots in the housing portfolio, 29 already committed for development and 15 that, after staff review with real-estate and utilities colleagues, were classified as significantly challenging (easements, topography, environmental constraints or utility conflicts). Staff described three pathways for city lots: small‑scale RFPs for infill lots, larger RFPs or site assemblages for higher-density projects and negotiated sales where a market buyer can offer fair market value to the city.
Why it matters: City lots and a clear pipeline can speed affordable development on smaller infill parcels and reduce land costs for projects seeking LIHTC financing. Staff said the city is exploring homeownership on small lots through Habitat and a community land‑trust model and that larger assemblages could support multi‑story tax‑credit projects.
Follow-up: Staff will bring small‑lot NOFA recommendations in November and said they will continue outreach to developers to understand barriers to small-lot uptake. Councilors asked for a combined map of other publicly owned parcels (county, state, school board) to identify larger assemblage opportunities and asked staff to return with a list of RHA (Raleigh Housing Authority) lots that may be available for redevelopment.
Ending: Staff emphasized that LIHTC projects are complex and that timing and program rules (the North Carolina QAP) matter; they recommended council let staff pursue both small infill and larger assemblage paths as complementary approaches to deliver units sooner.
