Finance New Orleans has made the process easier than ever to get public financing. Apply today to get PILOT’s, Bonds, and/or Tax Credits to fund your next housing project. Submit a pre-application today to see if your project qualifies to enter our program. We’re here to help you navigate public financing. If you have any questions, please contact Programs Director Kellie Schmidt.
What is the Multifamily Developer Program, and what is its purpose?
The Multifamily Developer Program was developed to provide tax-exempt bond financing, property tax exemptions (PILOTs) and green infrastructure loans to increase the supply of sustainable affordable housing. The program is also intended to provide the City and Finance New Orleans with local control over affordable housing development.
What is the benefit of receiving PILOTs, and/or Bonds and Tax Credits through Finance New Orleans?
The basic reason affordable housing developers seek property tax relief from the City is to offset the loss in rental income created by offering below market leases to families in need. Finance New Orleans’ PILOT product is structured to meet this basic need while generating a positive return on investment for taxpayers. The process for acquiring a property tax exemption from Finance New Orleans is designed to be fair, transparent and based on predictable market factors. Our primary goal is to stimulate affordable housing development while generating a reasonable market-based financial benefit for taxpayers.
What are the different bond options offered through the Multifamily Developer Program?
The different bond options are Multifamily Housing Bonds, Industrial Development Bonds, as well as 501(c)(3) Bonds. Multifamily Housing Bonds allow the developer access to tax-exempt bonds to finance low-income multifamily and senior housing projects. A qualified developer can finance a project at a lower interest rate than available through conventional financing because the interest paid to bondholders is exempt from federal income tax. Industrial Development Bonds (IDBs), allow manufacturers to finance projects at a lower interest rate than conventional financing because the interest paid to the bondholders is exempt from federal income tax. And lastly 501(c)(3) Bonds allows any nonprofit organization designated as a 501(c)(3) by the Internal Revenue Service the option to finance a project at a lower interest rate than available through conventional financing because the interest paid to bondholders is exempt from federal income tax.
What are the different Tax Credit options offered through the Multifamily Developer Program?
The Low Income Housing Tax Credit (LIHTC) Program, is designed to subsidize either 30% or 70% of the costs in a low-income unit rental project. The 30% subsidy, commonly called the “automatic 4% tax credit,” is for new construction that includes additional subsidies or that can be used for the acquisition cost of existing buildings. The 70% subsidy, or “9% tax credit,” supports new construction that does not include any additional federal subsidies.
How long does the process take for receiving PILOTs, and/or Bonds and Tax Credits through Finance New Orleans?
Receiving only a PILOT for a project through Finance New Orleans can take between 60-90 days once the Full Application has been received. To receive both Bonds and PILOT for a project can take between 6-9 months, due to the additional process conducted by the Louisiana Housing Corporation (LHC).
What information is required to begin the application process for the Multifamily Developer Program?
Initially an applicant/developer must submit a Pre-Application, which was developed to outline all the items that are required and necessary for a project to be approved and selected to advance to the Application Process. For example, the Pre-Application includes, but is not limited to, project summary, requested financing, project narrative, project benefits, as well as project cost.
What is the upfront cost to putting together a deal for an affordable housing project?
Generally the cost could range from 150K-300K per project.
What are the cost associated with applying for the Multifamily Developer Program?
Once a developer advances to the Application Process and submits their application, a $1500 application fee is required.
Who should I contact with any additional questions or concerns regarding the Multifamily Developer Program?
Our Programs Director Kellie Schmidt is the point of contact for any questions or concerns regarding the program.
*All of these questions are subject to current guidelines.