The Virginia Housing Development Authority has decided not to award federal tax credits to Oakland Pointe in 2019.
The state agency’s move would appear to throw a wrench into plans for the Oakland Pointe project, which proposes construction of an 119-unit apartment complex in Norge. Federal tax credits provided through the Low-Income Housing Tax Credit program are generally crucial to the success of affordable housing projects such as Oakland Pointe.
“These deals definitely tend to live or die based on their ability to get tax credits. The allocation of credits is critical to their success,” J. D. Bondurant, Low-Income Housing Tax Credit program director, said in an email.
Oakland Pointe developer Connelly Development had requested $1.7 million in tax credits, according to a manifest for 2019 application rankings posted to the agency’s website.
The Low-Income Housing Tax Credit program encourages developers to build housing intended for low-income people. Each state gets a per capita allocation of the federal tax credits annually. The VHDA studies proposed developments and determines whether to allocate tax credits through a competitive, points-based process. Points are earned through things such as green structure certifications, sponsor’s experience and number of units in a project, among other considerations.
Oakland Pointe scored a 495.4 in the rankings released Thursday, coming in lower than several other projects that also did not receive funding. Though funding allocations are finalized Dec. 13, the rankings will be subject to approval by the VHDA Board Wednesday.
“It is highly unlikely, yet possible, that the status changes, but it would take the board somehow singling this deal out for funding,” Bondurant said. “Given that Oakland Pointe’s final score is such that there are three other deals ahead of it in scoring that also did not get funded, this would add to the likelihood that it would remain in an unfunded status for this current round.”
Tim Trant, an attorney involved with the Oakland Pointe project who acts as a spokesman for the project, did not respond to a request for comment for this story Monday.
The project’s developer had previously said the Low-Income Housing Tax Credit program would be critical to make the construction of Oakland Pointe financially viable.
“If we don’t get the tax credits, the project isn’t feasible,” project developer Kevin Connelly told the Board of Supervisors when it considered a rezoning application for the project Feb. 12. The board deferred a decision until Feb. 26, giving Connelly time to shave down the number of units from 126 to 119 units. The board approved the rezoning Feb. 26.
The board’s vote rezoned about 15 acres of land from general agricultural to multi-family residential. The complex would be built on about 14.5 acres near the intersection of Oakland Drive and Richmond Road. An adjacent parcel, less than half an acre in size, would be the site of an access road from the complex onto Oakland Drive.
There was a year of meetings, deferrals and revisions before the Oakland Pointe rezoning was finally OK’d by the Board of Supervisors.
Public opinion on the project was divided, with opponents charging the project would damage Norge’s rural character and present a burden to the county’s schools among other concerns. Supporters argued the project would help address the county’s shortfall in affordable housing options.
There isn’t a formal appeal process for the tax credits. Connelly could attempt to make an in-person appeal before the VHDA board when it finalizes the rankings or reapply for the tax credits next year, Bondurant said.
Jack Jacobs, 757-298-6007, email@example.com, @jajacobs_