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Charlotte Amalie
Monday, December 5, 2022
HomeNewsArchivesHousing Finance Authority Seeks $2.55 million

Housing Finance Authority Seeks $2.55 million

In its second day of budget hearings on Wednesday, the Senate Committee on Appropriations and Budget heard testimony from the Virgin Islands Department of Housing Finance Authority regarding its request for $2.55 million for their fiscal year 2010 budget, an increase of approximately $230,000 when compared with last year’s appropriation.
Gov. John de Jongh’s proposed appropriation to the VIHFA for FY 2010 is $2.2 million and is, in fact, the exact amount they received for FY 2009.
The VIHFA, marking its 25th year of operation this year, was created to address the shortage of low- and moderate-income housing here in the territory and has provided more than 3,000 affordable home ownerships and rentals over the years with funding from both the federal and local government.
While low-income housing is funded primarily through federal programs such as Low-Income Housing Tax Credits, the HOME program, and Direct Lending, moderate-income clients have only the Guarantee Mortgage program, which provides mortgages at a lower interest rate.
Clifford Graham, executive director of VIHFA, said the tax credit allocation for the U.S. Virgin Islands is approximately $2.66 million per year, yielding more than $22 million in federal subsidies to be used for affordable rental units.
The HOME program for the territory was allocated $1,255,996 for FY 2009 and those funds should be available to the territory in October 2009.
The Direct Lending program, provided by the U.S. Department of Agriculture’s Rural Development program, was allocated a little over $5 million for FY 2009.
The USDA has allocated $9.2 million for the 2009 Guarantee Mortgage program, with an additional $18.4 million in funding from the American Recovery and Investment Act of 2009. According to Graham, the Guarantee Mortgage program “is underutilized here in the territory because typically local funding must be available to subsidize or cut down on the cost of the home ownership unit.”
According to Virgin Islands law, local funding for the VIHFA is supposed to be provided by the Housing Trust Fund and the stamp tax.
The Housing Trust Fund money, to be provided from a portion of increased property taxes above the initial assessed value of properties developed under the Affordable Housing Program, has had a zero balance since the mid-90’s.
The stamp tax monies earmarked to fund moderate-income housing clients for the years 2005 through 2008 total over $20 million, but VIHFA has only received approximately $12 million to date, including $3.6 million received in February of this year.
Graham told committee members that the only money the agency currently owes to outside vendors is $300,000 in utilities owed to the Virgin Islands Water and Power Authority. WAPA has expressed interest in a tract of land in Estate Mariendahl owned by VIHFA and they are currently negotiating with the goal of applying land purchase toward the outstanding bill.
VIHFA objectives for 2010 include four affordable housing development projects on St. Thomas, one on St. John, and two on St. Croix. They also plan to create a true emergency housing program in the territory as there currently are no emergency housing units.
No votes were taken at the hearing. Committee members present were Sens. Carlton “Ital” Dowe, Louis Patrick Hill, Wayne A.G. James, Terrance “Positive” Nelson, Samuel Sanes, and Patrick Simeon Sprauve. Absent was Sen. Craig W. Barshinger.

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