The award of $35.1 million in federal and state housing tax credits will advance housing opportunity and economic recovery in Wisconsin through creation of 2,200 affordable housing units in the months ahead, Gov. Tony Evers announced Tuesday.

The state and federal housing tax credit awards by the Wisconsin Housing and Economic Development Authority support 33 housing projects in 19 communities statewide and cap a highly competitive process that drew requests totaling more than $57 million. The award of $35.1 million represents an increase from the 2020 award total of $31.9 million.

WHEDA CEO Joaquín Altoro said this year’s plan for allocating the credits increased the emphasis on rural communities, supportive housing, partnerships with developers from underrepresented communities and sustainability. The 2021 projects range in size from a 24-unit project by the Lac Courte Oreilles Housing Authority in Hayward to a 173-unit, family-focused project by Roers Investments in Sun Prairie.

“If Wisconsin is to thrive, our workforce, our families and our most vulnerable residents require access to safe, affordable housing,” Altoro said. “As these needs continue to evolve, WHEDA is adapting its programs and strengthening critical partnerships with developers, lenders, local housing groups, community leaders and elected officials. Addressing Wisconsin’s longstanding housing gap demands innovation and collaboration.”

Highlights of this year’s state and federal housing tax credit awards include a total of $14.7 million in federal 9% housing tax credits to fund 17 projects with 866 low- and moderate-income housing units. A total of $7.1 million in state 4% housing tax credits will fund 16 projects with 1,334 low- and moderate-income housing units.

The award of the state 4% credits triggers the availability of $13.3 million in federal 4% tax credits for these projects. In all, the tax credits support development of a total of 2,343 units including the 2,200 low- to moderate- income units affordable for those earning at or below 60% of the area media income.

Communities with projects receiving awards are: Ashland, Ashwaubenon, Eau Claire, Hayward, Kaukauna, Kenosha, Lac du Flambeau, Madison, Manitowoc, McFarland, Middleton, Milwaukee, Mosinee, Oconto, Sister Bay, Stevens Point, Sun Prairie, Two Rivers and Wauwatosa.

The $14.7 million in federal 9% tax credits are worth some $126 million over the 10-year lifespan of the credits. The state 4% credits are worth some $35 million over a six-year lifespan and the federal 4% tax credits are worth some $114 million over a 10-year lifespan.

In exchange for receiving the tax credits, developers agree to reserve all or a portion of their housing units for low- and moderate-income households for at least 30 years. Any remaining units are rented at market rates. The developers then sell the tax credits to private investors to obtain funding. Once the housing project is available to tenants, investors can claim the tax credit as a dollar-for-dollar reduction of federal or Wisconsin income taxes owed over a 10-year period.

In 2020, funding requests also exceeded the $31.9 million allocation through the federal and state programs when applicants sought $61 million. WHEDA fully deployed the available credits in 2020 including some credits returned from prior allocations to help advance a total 2,058 affordable housing units.

Find details of the 2021 federal and state tax credit allocations here.