The New Orleans City Council, on May 21, approved an agreement between the city of New Orleans, Finance Authority of New Orleans (FANO), and Louisiana Housing Corporation (LHC) to help increase the affordable housing stock across the city.
Through the agreement, FANO can offer financial incentives to builders of affordable and climate resilient housing. The cooperative endeavor agreement allows FANO to pair its multifamily revenue bonds with LHC’s non-competitive 4 percent tax credits to provide tax incentives that aim to increase the availability of affordable rental housing.
“New Orleans is facing an affordability crisis that is impacting the fabric of our community and has only been exacerbated by the COVID-19 pandemic. This partnership will allow us to accomplish our shared goals by creating a more innovative and collaborative entity that can better create affordable housing options,” said Mayor LaToya Cantrell. “With this, we are continuing to demonstrate resourceful civic leadership that is working towards a common solution to improve the quality of life for our people.”
The city’s affordable housing challenges have existed for some time. According to recent studies, rents are up about 50 percent more than they were pre-Katrina. Also New Orleans has only 47 affordable rental units for every 100 low-income residents. Meanwhile, 36 percent of the city’s residents are severely housing-cost burdened, meaning they are paying more than 50 percent of their income on housing.
“Cooperation among government agencies is needed to address the large amount of demand for affordable and climate resilient housing. This agreement is an example of the type of collaboration required to deliver more value to the community,” said Damon Burns, President and CEO of FANO.
HousingNOLA, an affordable housing advocacy group, has estimated that New Orleans needs nearly 34,500 affordable housing units by 2025 to accommodate the needs of its residents.
“This is a unique partnership between the State and municipal entities,” said LHC Executive Director E. Keith Cunningham, Jr. “Housing is a local concern, and having local partners ensures that we get it right. This endeavor gives us the ability to make an even greater impact within the city of New Orleans.”