Sunday, June 5, 2011

$20 million to boost fund for affordable living near light rail

Two large lenders are investing at least $20 million to kick-start transit-oriented development along the Metro light-rail line.

The Local Initiatives Support Corp. and the Raza Development Fund each is committing $10 million to the new Sustainable Communities Development Fund, hoping it will grow soon to $50 million.

The fund should become available in the fall after a feasibility study is completed to prioritize projects and see what types of developments are most likely to flourish, said Teresa Brice, executive director of LISC's Phoenix office.

"We see this light-rail line as an unprecedented opportunity to build on our investments here and take it to a whole new level," said Michael Rubinger, president and CEO of LISC.

Tom Espinoza, president and CEO of the Raza Development Fund, said Rubinger challenged him to match LISC's $10 million commitment. Raza's investors include such major corporate giants as Bank of America, State Farm Insurance, Citibank and JPMorgan Chase.

"As an organization, we mainly said 'yes' because we believe in our community," Espinoza said.

"We have been part of this community since the beginning. Hopefully, this message gets to some of the legislators and sheriffs around here."'

A news conference to announce the fund was attended by Phoenix Mayor Phil Gordon, Mesa Mayor Scott Smith and Tempe Mayor Hugh Hallman, all of whom praised Metro as an outstanding example of regional cooperation. "You are viewing the maturation of a metropolitan area today," Smith said. "We're going to learn through this fund the impact that light rail can have on a community."

Smith said that LISC and Raza's investments will make a strong statement that adds credibility to light-rail projects and that other investors will likely follow their example.

Hallman said the Metro line already has prompted $2.5 billion in private investment along Apache Boulevard.

After 30 years of frustration in Tempe over redevelopment efforts, light rail has been a huge success because it is viewed as a permanent government investment, he said.

Michael Trailor, director of the Arizona Department of Housing, said projects within a half-mile of light-rail stations started receiving bonus points last year when they apply for highly competitive federal tax-credit financing.

The U.S. Treasury Department awards tax credits to the states, which pick out the most deserving projects. Two projects are under construction in Phoenix and Tempe and three more have been approved, Trailor said.

"We have a window of opportunity while the economy is trying to recover," he said, pointing to lower land costs making it easier to match light rail with affordable housing.

by Jim Walsh The Arizona Republic Jun. 2, 2011 12:00 AM

$20 million to boost fund for affordable living near light rail

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