Renaissance Box Building To Become Affordable Housing

The Renaissance Box building on the edge of downtown St. Paul, which used to be an old shoe factory, is one step closer to being reinvented into affordable housing.  The building was awarded about $967,000 in federal low-income housing tax credits on Wednesday by the St. Paul Housing and Redevelopment Authority board (HRA).  The funds from the tax credits will help the nearly $16 million project get rolling. The project includes a renovation to provide 67 housing units.

Each year the federal government distributes the credits to individual states. The states in turn divide the money amongst worth projects. St. Paul has a ranking system it uses to decide which projects merit the credits.

How it works basically is that the credits are sold on the market to investors. The investors benefit by reducing their income tax liability, and affordable housing developers benefit from the cash they get in return. Developments that want to use the credits must follow strict guidelines, including restrictions on rent and tenant income for a specific amount of time.

The city will receive a total of about $969,000 in low-income housing tax credits for 2009. Nearly all of that amount will go to the Renaissance Box.

The remaining $2,000 will be split evenly between The Terraces and East Side Commons, existing affordable housing projects.

The HRA board also approved $731,000 of Invest St. Paul money to be used for projects. The Terraces will receive a $600,000 temporary loan to make crucial building repairs. East Side Commons will get a $75,000 deferred loan to cover operating deficits. Project for Pride in Living will get a $56,000 grant to extend purchase options for a project on W. Seventh Street.