Tag Archives: community land trust

From the Director, December 2017

Jolene Kline, NDHFA executive director

As 2017 winds down and we look back at all that’s happened this year, I am more and more grateful to each of you for your continued partnership and support of North Dakota Housing Finance Agency and the housing industry in general.

In Washington, tax reform is still in ongoing negotiations and we don’t know for certain the total affect it will have on housing. One issue that is of grave concern to us is Private Activity Bonds, which the House eliminated but the Senate retained. We utilize the state’s Private Activity Bond authority to issue tax-exempt Mortgage Revenue Bonds to fund our homeownership programs. Without MRBs, we would not have the ability to offer competitive interest rates to first-time and other low-to-moderate income homebuyers.

Losing that program would be devastating for the people who need it most. This year, we have seen a continued upswing in homeownership activity. As more homes are on the market and the fevered competition that sprang from the oil boom of the past decade has cooled, first-time and lower-income homebuyers are better able to enter the market. We need to keep our main source of funding in place so that affordable homeownership will continue to be achievable.

Tax reform will also likely have a major impact on the multifamily development side as well. Lower corporate tax rates are expected to cause an approximately 10 to 15 percent drop in the value of Low Income Housing Tax Credits. That means that more credits will be needed per project to make them feasible and affordable. Receiving the small state minimum amount of tax credits, North Dakota Housing Finance Agency is able to fund about four or five projects each year. The unintended consequence of the tax cuts being debated in Congress will be a reduction in affordable housing for low-income individuals and families.

During the legislative session at the beginning of 2017, the Housing Incentive Fund came out with both a win and a loss. The program was made a permanent part of Century Code so we will no longer need to go back to the legislature every two years for renewal. That was a big win, but the loss came from the fact that no additional funding was authorized for the program. Due to some turn backs of previous awards, NDHFA was able to reallocate those funds this fall, but going forward we will not see the activity under that program that we have since 2011 when it was first created.

In 2017, NDHFA rolled out a program to assist community land trusts in North Dakota to have the capacity to do their work. The pilot allows CLTs access to a line of credit for acquisition/rehab or new construction of homes in their program. The Grand Forks CLT was the first to put the funding to use.

NDHFA is working out the details with the City of Minot to assist flood buy-out homeowners and those affected by the 2011 flood in buying a new home there. We look forward to having the program up and running very soon.

While these are just a few of the myriad of things that happened in housing this year, I certainly want to express my deep gratitude to those we work with every day. It is that day-to-day work that makes a difference in lives of North Dakota families. It is that work that gives people a warm place to sleep at night and a dining room table to gather around with family and friends.

I wish you the brightest blessings this holiday season and hope for another wonderful year full of partnership and progress in 2018. Thank you and happy holidays!

 

Community Land Trust Pilot Program Approved

BISMARCK, N.D. – The North Dakota Industrial Commission has approved a $3 million pilot program through the North Dakota Housing Finance Agency (NDHFA) that supports local Community Land Trusts (CLTs) efforts to create more single-family housing for low- to moderate-income households.

Community Land Trusts are non-profit organizations that make homeownership more obtainable by separating the ownership of the land from the cost of the home.

“We are very pleased the North Dakota Housing Finance Agency, as state government’s primary financier of affordable housing, is willing to take on this important challenge of making homeownership an option for more North Dakotans,” said members of the Industrial Commission in a joint statement.

The commission, consisting of Gov. Doug Burgum as chairman, Attorney General Wayne Stenehjem and Agriculture Commissioner Doug Goehring, oversees the NDHFA.

The NDHFA’s program will provide CLTs with access to a low-cost line of credit. Eligible uses include the acquisition, rehabilitation, demolition and/or new construction of homes on in-fill lots and in higher density neighborhoods for resale to income-qualified households.

In North Dakota, there are currently CLTs in Minot and Grand Forks. Other cities have expressed interest in developing trusts, but they have struggled to get started because they lacked the financial capacity.

“We look forward to reviewing the results of the pilot,” said NDHFA Executive Director Jolene Kline. “We hope that with the agency’s support, other North Dakota communities will be able to offer individuals and families with limited incomes this homeownership opportunity.”

The NDHFA is a public financial institution dedicated to making housing affordable for all North Dakotans. More information on the agency’s programs is available online, www.ndhfa.org, or by contacting the agency at (800) 292-8621.