Louisiana is in the hot seat after reportedly miscalculating the price tag for the state's affordable and mixed-income housing.
The state, which lost an estimated 82,000 rental units due to hurricanes and levee breaks in 2005, underestimated the costs of developing tax-credit subsidized housing and overestimated private contributions to those projects, according to a report by the Bureau of Governmental Research, a New Orleans-based nonprofit research firm.
The report reviewed the development costs and financing sources of 44 projects that had been selected by the Louisiana Housing Finance Agency to receive $80 million of the $168 million in Gulf Opportunity Zone Housing Credits authorized by Congress.
The report also questions whether the projects that received these financial incentives will actually get built. The LHFA requires the projects to be completed by December 31, 2008, or the developers may not be allowed to use the tax credits. But the housing agency remains confident that the majority of the projects will be finished, with financial gaps filled in by private sources.
“With anything, there is some fallout,” says Brenda Evans, deputy program administrator at LHFA. “But we do anticipate the majority of the projects being built.”