Iowa City’s new affordable housing nonprofit is already making waves.
The Iowa City City Council moved forward with the sale of city-owned housing at 1002-1006 N. Summit St. to Iowa City Affordable Housing, Inc., for $750,000, to make way for future development.
The Iowa City-based nonprofit was created in April by the Iowa City Housing Authority to help provide housing to low-income households.
The council unanimously approved the sale following a public hearing on the item during the June 16 city council meeting. The lot is currently empty as the city obtains financing.
Iowa City-formed nonprofit aids housing authority, gets tax incentives
Selling the Summit Street property to the nonprofit allows the city to apply for tax incentives, like the state’s workforce housing tax credit, to help finance the project.
“We hope this will result in a piece of the funding puzzle that will enable this project to get out of the ground here next year,” Iowa City City Manager Geoff Fruin said.
The city previously secured a loan agreement with the Housing Trust Fund of Johnson County to help fund the project, with rent revenue supplementing the loan payments.
The city’s switch to a nonprofit status allows it to transition from public housing to a fully Section 8 program, which has more stable funding, according to a city memo.
Renters in city-owned housing and Section 8 renters will still have to pay rent equal to 30% of their income, with federal Section 8 dollars covering the remainder.
The change arrives after years of unreliable public housing funding, with the city running at a net loss of $250,000 per year. City officials said Section 8 funding is more reliable.
36-unit affordable housing unit planned along Summit Street
The city plans to build a 36-unit affordable housing complex at 1002-1006 N. Summit St., which it acquired using American Rescue Plan Act funds in 2024.
The units will be income-restricted to those making at or below 50% of the median income.
Housing nonprofit eyes Hollywood Blvd. property for veteran housing
Iowa City Affordable Housing, Inc. is also eying a vacant apartment complex at 1102 Hollywood Boulevard. The city has set a hearing for July 14 to consider the city’s $2 million purchase of the 15, two-bedroom units.
The local housing authority plans to offer the property as longterm affordable housing for veterans experiencing homelessness using HUD-VASH project-based vouchers.
Iowa City Affordable Housing, Inc. must operate the facility to receive the vouchers, according to a city memo.
Liam Halawith covers Johnson County local government and crime for the Press-Citizen. Reach him by email at lhalawith@registermedia.com. Follow him on X at @liam_halawith.
This article originally appeared on Iowa City Press-Citizen: Iowa City gives land to new nonprofit for affordable housing project
Reporting by Liam Halawith, Iowa City Press-Citizen / Iowa City Press-Citizen
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By Liam Halawith, Iowa City Press-Citizen | USA TODAY Network
