Housing crunch help on the way
Funds for affordable housing could help balance supply and demand for lodging in western North Dakota, officials said Thursday.
The North Dakota Housing Finance Agency is offering $15 million in dollar-for-dollar tax credits to be used to construct or rehabilitate multi-family units, Executive Director Michael Anderson said. The HFA has allocated $25,000 in tax credits.
"This is a way that taxpayers can have a say in how some of their tax dollars can be spent," he said.
An oil boom in western North Dakota has increased the demand for housing in Dickinson, and the incentive is needed to help people find affordable housing, Sen. Rich Wardner, R-Dickinson, said.
"There are people that are important in the work force but they don't make high enough salaries to compete with some of the rents out there," he said. "We need to try to address that anyway we can."
The North Dakota Senate passed the Housing Incentive Fund unanimously in the regular session this year to allocate $4 million in tax credits for affordable housing. Though the House of Representatives failed to pass the bill the first time, it was reconsidered. Wardner said changes were made, and the House passed the amended bill 48-43.
During the special session in November, legislators allocated an additional $11 million.
The credits must be used to erect buildings with at least four units. Funds up to $1.5 million or 40 percent of the project cost can be claimed for taxes. Max Wetz, HFA director of public affairs, said 90 percent of the funds will be targeted to "oil-impacted and disaster-impacted areas."
"Stark County, and this part of the world, is one of the areas where we are particularly interested in getting both contributions and housing development going here," Wetz said.
The regular session bill allowed participants to claim 20 percent of the tax credits each year. To give a stronger incentive, Anderson said all the tax credits can be claimed in the first year.
"Now it is more attractive," Wardner said. "We are hoping some of the oil companies will participate in this. It's a great deal."
Anderson said there has been interest in the incentive in Dickinson. Housing in Belfield and Beach are also using tax credits from the program.
"The phone is ringing off the hook," he said.
Anderson added the fund is meant to keep rents down and target "low-, very low- and extremely low-income households."
"The state has made a commitment that we need to help in achieving affordable housing mostly in the western region because of what is going on here economically, but, really, it is a statewide issue," he said.