U.S. Rep. Bill Pascrell, Jr. (D-NJ-09) lead a bipartisan coalition including Reps. Joseph Crowley (D-NY), Rodney Frelinghuysen (R-NJ), Michael Grimm (R-NY), John Larson (D-CT), Frank LoBiondo (R-NJ), Charles Rangel (D-NY), Tom Reed (R-NY) and Carolyn McCarthy (D-NY) in introducing legislation to provide tax relief to the victims of the devastating storm that caused widespread destruction throughout the Northeast. The Hurricane Sandy Tax Relief Act of 2013 is aimed at providing tax relief for victims of Hurricane Sandy in areas designated as Federal Disaster Areas by the President. The bipartisan coalition will propose supplemental new market tax credit allocation authority for community development entities serving Hurricane Sandy disaster areas and increased low-incme housing tax credit allocation authority for delcared disaster areas.
Governor Christie to Announce HUD Approval of NJ Sandy Action Plan
It is anticipated that today at a news conference with Governor Christie the Governor will announce HUD’s approval of the New Jersey Sandy CDBG DR Action Plan. This approval by HUD of the first tranche of $1.8 billion will pave the way for additional allocations by HUD which may total over $4 billion for New Jersey from a Congressional allocation of $16 billion in CDBG DR funds for Sandy and other natural disasters. Within the approved action plan there is an allocation of $75 million of funds for Neighborhood and Community Revitalization. This program will be administered through the New Jersey Economic Development Authority. Also the action plan provides for an allocation $100 million of funds for the New Jersey Housing and Mortgage Finance Agency. The New Jersey Housing and Mortgage Finance Agency will use these funds with allocations of Federal low income housing tax credits to fund affordable housing projects in counties affected by Super Storm Sandy.
HUD Approves NY State Sandy CDBG Action Plan
On Friday April 26th the U.S. Housing and Urban Development (HUD) Secretary Shaun Donovan announced federal approval of New York State’s recovery action plan to help homeowners and businesses following Superstorm Sandy, Hurricane Irene, and Tropical Storm Lee. Funded through HUD’s Community Development Block Grant Disaster Recovery (CDBG – DR) program, New York State’s recovery action plan calls for a combined $1.7 billion investment in a variety of housing, infrastructure and business recovery activities. New York State’s approach will focus principally on meeting the immediate recovery needs for housing and business assistance in the communities affected by Hurricane Sandy. These activities include $838 million to support a variety of housing programs and $415 million to assist economic revitalization programs. On January 29th, President Obama signed the Disaster Relief Appropriations Act, 2013 into law, providing a total of $16 billion in CDBG Disaster Recovery funding. HUD quickly allocated $5.4 billion to five states (including New York) and New York City. New York State submitted its required action plan describing how the funds will be used on April 3rd and HUD conducted an expedited review to enable New York State to access these funds as quickly as possible.
Bipartisan House Support for Hurricane Sandy Tax Relief Bill
A group of 32 U.S. representatives sent House Speaker John Boehner a letter urging tax relief for the victims of Super Storm Sandy. The letter cited tax relief legislation passed in the aftermath of Hurricane Katrina as the basis for the passage of similar tax relief legislation in the aftermath of Super Storm Sandy. The letter urged the adoption of the Hurricane Sandy Tax Relief Act of 2012 (H.R. 6682) which was introduced during the 112th Congress. If adopted this Act includes a temporary, additional $250 million in new markets tax credit allocation authority for investments in areas affected by Super Storm Sandy.
NJHMFA Announces the Fund for the Restoration of Multifamily Housing
The New Jersey Housing and Mortgage Finance Agency has held two information sessions on the Additional Tax Credits/Fund for Restoration of Multifamily Housing which will be funded from the Super Storm Sandy CDBG grant provided to the State of New Jersey from HUD. The proposed Community Development Block Grant Disaster Recovery Action Plan submitted by the State of New Jersey to HUD for approval includes the creation of the Fund for Restoration of Multifamily Housing. This Fund will be administered by the New Jersey Housing and Mortgage Finance Agency (HMFA) and is expected to provide over $104 million in CDBG-DR funding to replenish the stock of quality, affordable housing units lost as a result of Super Storm Sandy. The NHMFA information sessions provided a description of the Fund’s proposed components, which includes leveraging CDBG-DR funds with the federal Low Income Housing Tax Credit Program.
New Jersey Submits Sandy CDBG Action Plan to HUD
New Jersey has submitted the Community Development Block Grant (CDBG) Disaster Recovery Action Plan to the U.S. Department of Housing and Urban Development (HUD) for review and approval. After the initial publication of the Action Plan, the public had an opportunity to comment on the Action Plan during a seven-day period that closed March 19. The Plan submitted to HUD includes the public comments that were submitted along with the State’s responses. After submission of the New Jersey Action Plan HUD has up to 45 days to approve the Action Plan. A copy of the Final CDBG Disaster Recovery Action Plan as submitted to HUD can be found here: http://www.nj.gov/dca/announcements/pdf/CDBG-DisasterRecoveryActionPlan.pdf
Leveraging Sandy CDBG Grants
A prominent mandate of the New Jersey, New York City, and New York State action plans is the leveraging of Sandy CDBG grants with other federal programs and private funds. In this vein, there are several programs which are available to leverage Sandy CDBG funds. Coupling the Sandy funds with the Federal New Markets Tax Credit Program was done Post Katrina and will generate approximately 25% of project costs through Federal Tax Credit equity generated on the remaining 75% of Sandy funds which flow through the New Markets Tax Credit Structure. Under the proposed New Jersey Action plan approximately $100,000,000 is slated to go the New Jersey Housing and Mortgage Finance Agency to be used as a grant similar to TCAP to leverage the Agency’s 9% low income housing tax credit allocation as well as make 4% low income housing tax credit transactions economically feasible. In a similar vein, investment funds are forming with the plan of using private capital to leverage Sandy CDBG funds for projects. These transactions should be attractive to funds because the leverage would be relataively low and the security and financial return on the investment very good. Applicants seeking Sandy CDBG funds should be prepared to demonstrate the leveraging of these funds with public programs and private investment.
New York City Publishes Sandy Action Plan
The City of New York published its Action Plan to allocate $1.77 billion in Hurricane Sandy authorized Community Development Block Grants to the City’s most urgent housing, business and infrastructure needs. Under the proposed Action Plan $720 million will be allocated to Housing with $350 million going to rehabilitating single-family houses, $250 million to multi-family houses and $120 million to public housing. $325 million is allocated to assist businesses. $100 million will be available in grants to businesses. Small and mid-sized businesses will be eligible for $100,000 grants and larger businesses in hard-hit areas will be eligible for $1 million grants. In addition $145 million will be disbursed through competitions rewarding innovative investment ideas for neighborhood growth and infrastructure improvements. Under the Action Plan $400 million is allocated to Infrastructure and City Services including public services, emergency demolition, debris removal, code enforcement, and reconstruction of public facilities. Finally the Action Plan references $327 for Resiliency Investments which program will be detailed in a future amendment to the Action Plan.
New York State Publishes Sandy Action Plan
The State of New York has published its action plan in connection with the first $1.7 billion in Federal CDBG-DR aid appropriated by the United States Congress, and allocated to New York State, for Sandy disaster relief. Using this first allocation, the State will focus principally on meeting the immediate needs for housing and business assistance in the communities affected by recent storms; assisting county and local governments to cover both their emergency expenses and the matching fund requirements that must be met to repair and mitigate key infrastructure projects; and, by leveraging private financing, assisting critical facilities that suffered damage to install energy-related mitigation (e.g., combined heat and power systems) to withstand future natural disasters. Continue reading “New York State Publishes Sandy Action Plan”
New Jersey Publishes Sandy CDBG Action Plan
New Jersey has published its action plan for the $1.8 billion CDBG grant allocated by HUD to assist the State’s Hurricane Sandy recovery efforts. The public comment period for the action plan will end at 5:00 pm on March 19. Additional allocations are expected to be made at subsequent dates to be determined by HUD. Funds must be spent within two years unless HUD provides an extension. Governor Christie has designated the New Jersey Department of Community Affairs as the entity responsible to HUD for administering the distribution of CDBG funds for New Jersey. The action plan provides for the distribution of the $1.8 billion of CDBG funds in the following areas: homeowner assistance; rental housing; economic revitalization; and support for state and local agencies. Within each category are a variety of programs to address specific recovery needs. As an example, with respect to rental housing, $100,000,000 is designated to facilitate the creation of quality, affordable housing units to help New Jersey recover from the loss of multi-family housing. CDBG funds will be provided as zero- and low-interest loans to qualified developers to leverage 9% and 4% low income housing tax credits, tax-exempt bonds and stand-alone financing to support development. Awards will be limited to $120,000 per unit. Similarly $75,000,000 will be awarded through NJEDA in amounts up to $10,000,000 to redevelopment agencies, municipalities, businesses and nonprofits, including CDFIs and CBDOs for community revitalization. These funds may be used for property acquisition, demolition, site preparation and infrastructure repair and installation as well as physical improvement and expansion of existing facilities.