The California Tax Credit Allocation Committee (CTCAC) has allocated $10,301,010 in Federal Low Income Housing Tax Credits (LIHTC) to a local project to be developed by the Housing Authority City of Santa Barbara (HACSB) through its nonprofit, Santa Barbara Affordable Housing Group.

The new housing called Vera Cruz Village, at 116 E. Cota St., will be built for those with special needs, including the homeless. Total development costs are estimated at $17.6 million.

The project will provide 28 studio units for very low- and low-income renters; a one-bedroom manager’s unit; and a common area and office space to accommodate the provision of supportive services and activities on-site.

HACSB purchased the site, previously approved as an accessory dwelling unit (AUD) project for 15 two-bedroom market rate-rental units, and commercial space, with plans to convert the development to provide affordable housing units.

The CTCAC, which administers the LIHTC, selected the local project for LIHTC funding at the conclusion of a competitive application process. Tax credit developments must meet high design and operating standards, including strong management and excellent development quality.

LIHTC funding stimulates private investment in affordable housing by awarding tax credits to developers, who agree to reserve a portion or all of their housing units for low-income households for a minimum of 55 years. Developers sell their tax credits to investors to obtain equity financing for their developments.

This federal resource continues to be one of the state’s most successful public-private partnerships, and accounts for about 90 percent of all affordable rental housing created in the U.S. today.

“Together, HACSB and SBAHG have established a proven track record for developing high-quality, affordable housing for targeted populations in Santa Barbara,” said Rob Fredericks, HACSB executive director/CEO.

“With the recent completion of The Gardens on Hope for seniors, and Johnson Court, designed to address the needs of formerly homeless veterans, we are turning our attention to developing this exciting new housing project,” he said.

“It is critically needed by vulnerable special needs residents who have a difficult time finding a clean, safe, place to call home where they can receive the services and support they need to stabilize their lives,” Fredericks said.

The property consists of two parcels with a combined total of about 11,000 square feet; it sits across the street from the current Cota Street commuter parking lot.

Construction is anticipated to start in the fall and be completed within 12-14 months. All studio units will be subsidized with Project Based Vouchers, making rent affordable at 30% of a resident’s income.

The Cota Street property will feature:

– A walkable downtown location close to essential services and other amenities.
– A strong good neighbor policy, exemplary of the Housing Authority’s track record with managing permanent supportive housing developments.
– Project-based rental assistance to provide affordable rent to every resident.
– Regular on-site supportive services including case management and instructor-led educational and health and wellness classes available to residents free of charge.
– Free in-unit internet service.
– Full-time on-site manager to oversee the apartment complex.
– Community room for resident programs, group activities, and support groups.
– Controlled access points for entering and exiting the property. No parking demand for residents, reducing the traffic impact of the area.