The New Braunfels Economic Development Corp. will spend half a million dollars to cushion a proposed affordable housing project’s financial shortfall due to a reduction in tax credit equity pricing.
In a 6-1 vote, New Braunfels City Council approved a resolution that gave the NBEDC the green light to spend $500,000 for the Park at Dogwood during a regular meeting on Nov. 9.
District 1 Council member Toni Carter, who was the single dissenting vote, said she is empathetic to the need for affordable housing, but when tax dollars are at stake, she does not like a model that comes up short.
“I won’t support the project as a result of that,” Carter said.
The overview
The Park at Dogwood is a planned $22.3 million low-income housing development located at 1869 McQueeney Road. In July 2024, the state notified the developer that the project had been selected to receive tax credits and they began the site development process, according to agenda documents.
The tax credits cover $20.4 million of project costs—producing a budget shortfall of $1.90 million. If the gap is not reduced or eliminated, developers cannot close on the project and construction cannot begin. It also cannot convert to the permanent loan phase, agenda documents state.
A $272,000 roadway impact fee waiver and a $500,000 rebate from NBEDC will cover about $772,000 of that budget shortfall. This leaves the project with a financing shortfall of $1.13 million, which is filled through a deferred development fee, according to the meeting presentation.
“The city’s direct contribution represents a relatively small percentage of the overall project cost but makes a meaningful advancement toward the project’s overall financial feasibility,” said Jeff Jewell, director of economic and community development.
Project details
Affordable housing project units must be rented at “affordable rates” to low- or moderate-income tenants for an affordability period of about 30 years, agenda documents state. If a developer fails to meet the affordability requirements during the project’s first 15 years, tax benefits must be repaid.
The Park at Dogwood will be a 76-unit housing project offering 1-bedroom and 2-bedroom plans for households earning 30%-60% of the San Antonio–New Braunfels Metro Area Median Income. The development is also slated to be exempt from paying property taxes, which would remove $18,200 annually from the city’s tax rolls, according to the presentation.
Public input
Family Life Center CEO LaMoyne Davis said the council recognized National Hunger & Homelessness Awareness Week through a proclamation earlier that evening.
“I’m here to ask you to back that proclamation with action by voting yes on the incentive,” Davis said.
Over the last year and for the first time, more than 700 people sought psychiatric services at Hill Country MHDD, Clinic Director Jesamy Ferguson said.
“Over 75% of those people identified housing insecurity as one of the biggest stressors that is leading toward their mental health issues,” Ferguson said. “Over half of those were people that have lived in New Braunfels 5 years or longer.”
District 6 resident Aja Edwards, whose neighborhood backs up to the planned development, said she was “thrilled” about the project.
“It’s needed,” Edwards said.
Angela Keller, a resident who lives in the city’s extraterritorial jurisdiction, said she respects affordable housing, but there should be more restrictions on it.
“I’m not sure how EDC works; however, if it was the taxpayer money I would definitely say we need to get with Congress and see about some bills or laws being changed,” Keller said.
How we got here
During a meeting on Sept. 14, New Braunfels City Council voted against a resolution requesting the New Braunfels Utilities board of trustees consider an impact fee waiver of up to $500,000 for the project. The dais directed city staff to ask the NBEDC to consider funding the project’s request.
During an NBEDC meeting on Oct. 15, board members unanimously recommended reimbursing up to $500,000 to help reduce the Park at Dogwood’s funding shortfall.
