According to the Arkansas Democrat-Gazette, the state agency charged with dispersing certain funds and tax credits to develop low-income housing is doling out that money based on economic growth rather than need, according to a recently filed federal complaint.
The complaint alleges that over the past three years, two measures the Arkansas Development Finance Authority (ADFA) uses to award HOME funds and Section 42 low-income housing tax credits have resulted in a disproportionate benefit to Northwest and Central Arkansas at the expense of other regions.
The HOME Investment Partnerships Program awards dollars from the U.S. Department of Housing and Urban Development to jurisdictions for housing projects and community development. The Section 42 tax credits are given to investors who build affordable housing.
No state in the country has enough housing that’s affordable to people with low incomes, studies have shown. Housing is considered “affordable” if a household spends one-third or less of its monthly income on rent or mortgage payments.
Dustin Duke, an attorney at Arkansas Law Partners, filed the complaint last month with the federal Treasury Inspector General for Tax Administration on behalf of “a group of Arkansans interested in low-income housing,” whom he declined to name in an interview with the Arkansas Democrat-Gazette.
The federal government mandates that agencies distributing the funds consider certain factors to achieve the goal of providing affordable housing.
