Nearly $3 million in federal funds available for developers, landlords, and non-profit organizations to build, preserve, and rehabilitate affordable homes
Nearly $3 million in federal funds will become available to support the creation of affordable housing units across Chattanooga beginning in July 2023, as part of three local programs managed by the City’s Division of Housing and Community Investment.
Funded by the U.S. Department of Housing and Urban Development, the programs provide grants and forgivable loans to developers, landlords, and non-profit organizations for the development of new affordable units and the rapid repair and renovation of vacant units.
The City is hosting a workshop to discuss the opportunities with interested parties this Thursday, Feb. 2, from 2 p.m. to 4 p.m. at the Development Resource Center.
“We’re working hard to increase Chattanooga’s affordable housing supply in every neighborhood, and a huge part of that is making the market more attractive for builders and landlords to develop and rent affordable units,” said Chattanooga Mayor Tim Kelly. “That’s why programs like these are so important – they offer financial incentives that will help catalyze the creation of affordable homes across the city, so that Chattanoogans can access quality housing at every price point.”
Two of the programs—the Rapid Rental Repair Program and the Landlord Renovation Program—provide Community Development Block Grant (CDBG) funds to landlords to assist with the costs of repairing and renovating vacant rental units. Landlords are then required to re-rent the units to individuals and families who make no more than 60 percent of Chattanooga’s area median income, at a cost that does not exceed 30 percent of their monthly income.
The third program provides funding to developers through the HOME Investment Partnership to support up to 50 percent of the construction costs for similarly affordable units, at a maximum of $40,000 per unit.
Applications for CDBG funding are due by February 28, 2023. The application for HOME-funded projects will be available year-round.
“We are laser-focused on developing the tools we need to increase the supply of affordable home ownership and rental opportunities for all Chattanoogans, and that includes deepening development incentives for local builders and landlords,” said Chief Housing Officer Nicole Heyman. “I’m grateful for our strong partnership with HUD, which makes programs like these possible. My team and I will be working to expand and enhance similar funding opportunities in the months ahead.”
Building a toolbox to catalyze affordable housing development is a key strategy in Kelly’s ongoing work to increase accessibility to housing in every neighborhood. Last year, Kelly launched a $100 million affordable housing initiative, which included an unprecedented $33 million in this year’s budget to help create and preserve hundreds of affordable homes.
Since taking office, his administration has supported the development of more than 380 new affordable units through HUD funds, with another 230 planned using American Rescue Plan dollars.
The City is also conducting a top-to-bottom redesign of its land use and zoning codes to make it easier for builders to construct the types of housing that most residents can afford.