A leading community development organization announced plans Wednesday to invest $1.5 billion in affordable housing nationwide in the next five years, including more than $200 million in California.
Of the money earmarked for the state, a “considerable amount” will be invested in apartments for low-income families in South-Central Los Angeles, with other funds designated for the renovation or construction of housing in depressed neighborhoods of San Diego, Oakland, San Francisco and several smaller communities, officials said.
Specific projects are being developed with the cooperation of local organizations and will be announced next week, according to Patricia A. Foley, senior vice president of the nonprofit Local Initiatives Support Corp., which is coordinating the effort.
Nationwide, she said, the funds will provide for construction or renovation of about 35,000 units. Efforts similar to those in California will be undertaken in Chicago; New York; Cleveland; Kansas City, Mo.; Miami; Philadelphia; Phoenix; Seattle and Toledo, Ohio.
Since 1987, Foley said, the organization has raised $620 million from major corporations to build 15,000 affordable-housing units. About 3,000 of those units have been built in California at a cost of about $150 million, she said. Thirty are in Los Angeles and include the Prentice and Leonide apartments, as well as the San Julian, Crescent and Hart hotels.
Of the new funding, she said: “A considerable amount will go into South-Central Los Angeles, but we are not neglecting neighborhoods in Pasadena, Santa Monica, Venice, Van Nuys, Berkeley, Fresno, Sacramento and some rural communities.”
Paul S. Grogan, president of the support corporation, said the $1.5-billion investment represents the largest commitment so far under law enacted by Congress in 1986 to provide tax credits for low-income housing.
Under the provision, corporations that invest in or build affordable housing for low-income families receive a partial credit toward federal taxes on their corporate earnings.
A major contributor has been Bank of America, which has made a commitment to invest $40 million in the new projects--$30 million of which is designated largely for South-Central Los Angeles, said David A. Coulter, vice chairman of the bank.
The architects of the housing tax credits--Senate Majority Leader George J. Mitchell (D-Me.) and Rep. Dan Rostenkowski (D-Ill.), chairman of the House Ways and Means Committee--joined Local Initiatives and Bank of America officials in announcing the effort.
Mitchell said that the tax credit legislation has become “the leading means of developing affordable housing in this nation.” This year, the credits became a permanent part of the federal tax code, he said.