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Developer seeks tax credits for housing

But the crucial federal program is difficult to implement here.
By Benjamin Graham, Jackson Hole, Wyo.
February 27, 2013

An Idaho developer is applying for tax credits that would pay for the renovation of two affordable housing complexes in Jackson.

Northwest Associates, a Boise-based company, submitted applications to the Wyoming Community Development Authority for low-income housing tax credits.

Money earned from selling the tax breaks to investors would be used to finance upgrades at the Jackson Apartments south of town and the Brandy Chase Apartments in east Jackson.

The federal program, which is administered by the state, is designed to increase the number of rental units available to households with incomes at or below 60 percent of an area’s median income.

The money can be used to build new housing or to renovate older projects.

Gary Machacek, owner of the company, did not return calls for comment Monday or Tuesday.

An official with WCDA said improvements to the apartment complexes would be significant.

“One of our requirements is that there has to be substantial rehabilitation,” said Christian Pritchett, federal programs coordinator at WCDA. “It has to be more than just a face-lift.”

Twenty-three units, all one- or two-bedroom, will be refurbished at Brandy Chase. Another 27 Jackson Apartments will be remodeled. Residents of the complexes will have to earn 35 percent to 60 percent of Teton County’s median income to qualify to rent the new spaces. A family of three would have to make between $30,345 and $52,020.

The federal tax-credit program has helped developers build five affordable rental projects in Jackson in the past three decades, filling a crucial housing niche in town where the cost of living is often too high for workers.

But the tax credits have been difficult to come by in Teton County because of land costs, said Anne Cresswell, executive director of the Jackson Hole Community Housing Trust.

The program caps what developers can spend on land and construction costs. For example, a developer anywhere in Wyoming can spend no more than $123,200 on each one-bedroom unit that isn’t accessed by an elevator.

“If you can get the dirt alone for [that much], you’re lucky,” Cresswell said.

She said the only way the program is possible in Jackson is if a developer partners with a group such as the housing trust to acquire the land.

The Teton County Housing Authority assisted in two of the five of the past projects, said authority executive director Christine Walker.

The authority helped provide the land and matching grants for Snow King Apartments, which received tax credits that brought in $2.4 million beginning in 2002. The organization also helped developers apply for grants for the third phase of the Pioneer Homestead. That project received $1.8 million through the federal program.

“It targets the really low-income individuals in our community,” Walker said. “It’s a very important piece, because it isn’t something that’s getting attention from the private sector.”

Jackson Apartments was the first project in Teton County to use the program. Developers applied for credits in 1988 and ended up collecting $263,335.

The second phase of the Pioneer Homestead garnered $730,572, while the Aspen Creek Apartments’ tax credit proceeds totaled $1.7 million.

All told, low-income housing tax credits have helped bring 125 affordable rental units to town.

Pritchett said the two applications from Jackson this year are unusual; most projects processed by his department are for new developments.

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