Housing Incentive Fund for Western ND | VideoAlex Hagan | 7/27/2012
However, the program is dealing with some early challenges.
Another affordable housing project is coming to Belfield thanks to the Housing Incentive Fund. The money comes from individual and corporate donations to build affordable housing.
"Lender`s aren`t willing to put 100 percent financing into the project so they rely on this source of equity to make the projects work and the developers need that equity to bring those rents down to make them affordable," said Jolene Kline with the North Dakota Housing Finance Agency.
Affordable housing, which is considered to be no more than one third of a person`s income, has become almost non-existent in booming communities.
"Housing that you pay $800 to $900, $800 to $950 dollars for a two bedroom unit versus what`s happening in so many areas at $2,500 to $3,000 plus for that," said John Phillips with Lutheran Social Services Housing.
The fund will cap out at $15.5 million. So far, it`s less than halfway there.
"We have a lot of projects that are stalled that can`t start construction until those contributions come in to the fund," Kline said.
The program helps in communities like Dickinson and city leaders are grateful it was established.
"If this program wasn`t around we would have two projects that wouldn`t become a reality," said Dickinson City Administrator Shawn Kessel.
Once the funding reaches the cap, the legislature would have to create another fund next June. State leaders say it will certainly be necessary.
"I think we`re really going to see a big decline in the amount of affordable housing that gets developed which really stymies economic development in those communities," Kline said.
State leaders are confident it will be reinstated.
"I really think that legislators right now really see the benefit of that and as we continue to introduce projects such as this. I think they will recognize that," Phillips said.
And that`s because they say the affordable housing shortage won`t end any time soon.
Right now, the fund is at nearly seven million dollars. MBI Energy Services contributed $225,000 to the fund specifically for the Belfield housing project.