New Federal Housing Legislation Boosts Bond Cap for N.Y. Agencies

The New York State Housing Finance Agency and the New York City Housing Development Corp. will be able to issue additional tax-exempt private-activity bonds to finance construction or preservation of more than 4,200 affordable housing units after President Bush yesterday signed federal housing legislation, Gov. David Paterson said yesterday.

The law lifted the state's volume cap in 2008 by $633.6 million to $2.27 billion.

The specific division of the cap between the two agencies will be decided by the division of budget in the coming months, budget spokesman Jeffrey Gordon said in an e-mail.

An historic building boom in New York Cityhas made volume cap a scarce commodity in recent years.

HDC president Marc Jahr said in an interview that the corporation has $700 million of multifamily housing projects in its pipeline that could use the additional volume cap.

The new law also permits the issuers to begin recycling private-activity bond volume cap that has been refunded or retired on multifamily housing as had already been permitted for single-family housing.

HFA spokesman Philip Lentz said the two housing issuers would be able to recycle between $200 million and $250 million of bonds volume cap annually. About $75 million to $100 million of that annual recycling would be done by HFA, he said.

Some of the cap will also be used to provide low-interest mortgages for first time borrowers through the State of New York Mortgage Agency.

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