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Subcommittee urged to recommend $14.8M in county funding and loans for Cox Avenue and Fairy Road projects
Summary
Staff asked Buncombe County's Affordable Housing Subcommittee to recommend loan and funding levels to the Board to support two large multifamily projects (Cox Avenue and Fairy Road). Staff proposed designating bond and program‑income funds, adding $3,592,357 from general funds, and making a $9.8M loan to Cox Avenue and a combined $5M loan to Fairy Road to enable LIHTC applications.
County staff presented an update on Cox Avenue and Fairy Road development projects and asked the Affordable Housing Subcommittee to recommend funding levels and loan terms to the Board so developer applications to the North Carolina Housing Finance Agency (NCHFA) and layering of CDBG‑DR funds could proceed.
Staff said Cox Avenue (county property at 5052 Cox) is proposed for redevelopment with Harmony Housing under a memorandum of understanding; the current proposal is roughly 203 units, weighted toward one‑bedroom units and incomes under 60% area median income. Urban Atlantic is the development partner identified for Fairy Road, which includes a family LIHTC component of about 200 units and other project elements.
Staff presented updated funding‑gap estimates: Cox Avenue's current gap is about $26.9 million (the county had earlier identified a $9.8 million commitment, leaving roughly $17.1 million additional need), and Fairy Road's gap is about $21.5 million (with a $5 million county commitment). Staff said layering state CDBG‑DR funds can increase development costs and influence final gaps.
Because developers must show capital commitments when applying to NCHFA, staff asked the subcommittee to recommend that the Board designate existing bond funds and program income, approve an additional $3,592,357 from general funds, and authorize loans of $9.8 million to Cox Avenue and $5 million to the Fairy Road projects with standard 20‑year, 2% cash‑flow payment terms. Staff said issuing commitment letters earlier would help Harmony Housing and Urban Atlantic meet the May application timeline.
Staff described the broader funding context: the state has identified roughly $131 million for multifamily CDBG‑DR funds, with $60 million planned for allocation by NCHFA to LIHTC projects; the 4% LIHTC loan cap is $15 million and city CDBG‑DR caps differ (city cap $10 million), so projects must layer sources carefully and competition statewide is high.
Committee members asked about neighborhood traffic concerns, the city's own CDBG‑DR allocation process and whether the county must apply to the city first when a project sits inside city limits. Staff said traffic concerns and design adjustments are addressed through the city's review process; the county must request city CDBG‑DR funds for projects inside city limits before seeking state funds, and the city council's selections could affect the state's layering options. Staff recommended the subcommittee wait for the Board update on March 17 and reconvene March 31 for final recommendations.
What happens next: the subcommittee was asked to recommend funding levels by the end of March so commitment letters can be issued to support LIHTC applications. The Board will consider loan term approvals and final funding decisions.
