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Panel backs revolving loan fund to spur mixed‑income affordable homeownership
Summary
SB 6,028 would create a revolving loan fund administered by the Housing Finance Commission and Commerce to provide below‑market loans for mixed‑income affordable homeownership projects; sponsors said loans would be construction‑period, repaid within 36 months, and include 99‑year affordability covenants for permanently affordable units.
The Senate Housing Committee heard testimony Jan. 16 on SB 6,028, which would establish an Affordable Homeownership Revolving Fund administered by the Housing Finance Commission under contract with the Department of Commerce.
Senator Alvarado said the tool aims to address a financing gap for for‑sale projects that are otherwise uneconomic under current interest‑rate and capital conditions. The fund would provide below‑market repayable loans as part of construction financing; sponsors said the loans are envisioned to be repaid within 36 months and that commitments to permanently affordable units would be secured through covenants or deed restrictions lasting up to 99 years.
Steve Walker of the Housing Finance Commission said the fund could offer low‑interest construction loans that help deals 'pencil' and then revolve as loans are repaid and homes sell. Habitat for Humanity and other nonprofit developers supported the concept, urging a higher project cap in the commission’s criteria to help nonprofit builders utilize the program.
Committee members asked operational questions about loan position, repayment mechanics and how revolving loans interact with subsequent mortgages or sales; staff and proponents said the fund is intended to participate in construction financing (not necessarily first‑lien), to be repaid when homes sell, and to be designed to revolve and seed repeated rounds of development. A fiscal note was requested and not yet available.
