The maximum amount of outstanding project debt benefiting from credit enhancement was capped at $50 million. Given the success of the program, the council authorized an additional $50 million.
"The lack of living wage housing in this region is one of the greatest challenges facing King County," says Cynthia Sullivan, chair of the council's Growth Management and Unincorporated Areas Committee. "Forming partnerships with developers has allowed us to start working on this crisis. This measure is a positive step towards strengthening that partnership and increasing the number of affordable units in our communities."
The program, which began in 1998, provides credit enhancements through contingent loan agreements to project developers/property owners. In exchange for the loan agreements, which reduce financing costs for housing developments, the project developer/property owner agrees to provide long-term affordable units within their project.
Since the start of the program, four project owners have entered into contingent loan agreements, with the goal of providing housing for those households earning less than 80 percent of the median income for King County. It is estimated that the increase in enhancement authority could help develop or preserve an additional 450 units in six to eight housing developments over the next five years."
"In a slowing economy, this is an especially good investment," says Larry Phillips, vice-chair of the council's Budget and Fiscal Management Committee. "Developers are willing to work with us to ensure that living wage housing doesn't disappear from King County. For a small investment we're helping the region's economy while creating housing for some of our most vulnerable citizens, and that's worthy of our support."
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