Housing Trust Fund outlines grants, forgivable loans and recent awards to address Iowa City-area affordability

Ellen McCabe, executive staff of the Housing Trust Fund of Johnson County, told the Iowa City Housing Commission that the trust fund's mission is to "promote and support housing that is affordable" and described two core programs: a revolving loan fund and an owner-occupied rehabilitation program intended to assist low-income homeowners and providers. McCabe said the trust fund's two programs together typically help about 15 homeowners per year through federal and local matching funds.

McCabe described how the fund uses a mix of awards: grants for projects without property security (often for households at the very lowest incomes), 0% forgivable loans primarily to small nonprofits, and low-interest repayable loans (1%–4%) for for-profit organizations depending on project finances. She said the fund also sometimes uses blended "combo" awards (part forgivable, part repayable) and attaches mortgages, promissory notes and loan agreements to secure long-term rent or affordability commitments.

On recent activity, McCabe said the trust fund paid out about $1.4 million last year to help roughly 94 households and that those payouts leveraged about $3.4 million in additional financing for a total project investment of about $4.8 million. She said in a recent funding cycle roughly $3.2 million was available while applications requested about $8.8 million, leaving some applicants encouraged to apply again.

McCabe outlined the trust fund's decision process: an operations/distribution committee (bankers, developers, local elected representatives and staff) reviews applications and makes recommendations to the full board, which sets final awards. She noted the trust fund prioritizes projects that serve households at the lowest income levels (below 30% of area median income), that serve populations with additional needs (disability, reentry from incarceration, etc.), and that demonstrate leverage and past performance. She said the fund has indexed maximum per-unit support upward to reflect rising costs and, for example, now allows larger awards for three-bedroom units than it did previously.

During a question-and-answer segment, commissioners asked whether for-profit developers may apply; McCabe said for-profit entities can apply for below-market loans but the vast majority of applicants are nonprofits. Asked how the trust fund enforces rent and income restrictions, she said those terms are enforced via recorded mortgages and contractual loan documents requiring compliance for the agreed affordability term.

McCabe also described outreach and pilot work: past grants and loans supported projects such as Housing First pilots with Shelter House and rental support for reentry programs; she cited a forgivable loan to Immigrant Welcome Network (about $275,000) to support transitional housing for several households. She said the trust fund runs quarterly rounds and offers applicant support including course sessions and direct consultation, and that award letters frequently include contingencies tied to organizational milestones (for example, proof of 501(c)(3) status).

The presentation closed with commissioners requesting McCabe's annual report and additional materials; McCabe said she would email the report and that much of the fund's information is available on its website. The commission heard no formal action on the trust fund beyond the presentation and Q&A.