New Mexico MFA Funds Indian Housing

ALBUQUERQUE, N.M. – The New Mexico Mortgage Finance Authority has funded
$17.5 million in American Indian housing between 1992 and 2003, and has
several new projects under way this year.

NMMFA is funding two Low Income Housing Tax Credit projects this year at
the Laguna pueblo, and has also structured a unique use of several programs
at Laguna and three other Indian pueblos, according to Michelle Den
Bleyker, loan underwriter.

At Laguna, the tax credits will help fund two single-family housing
projects, with a total of 79 units. Both new construction and rehabs will
be included.

The state housing agency also is packaging money from the Rural Housing and
Economic Development program run by the Department of Housing and Urban
Development in a first-ever program leveraging tribes’ federal housing
assistance money.

This trial program will rehab 20 units of housing at the Laguna, Tesuque,
Picuris and Pojoaque pueblos, said Den Bleyker. Recipients will receive
$6,000 grants under the RHED Program, and loans of $25,000 from NMMFA’s
Primero loan program. The tribes’ federal housing assistance money will be
used to guarantee the loans.

Five to six of the loans should close by the end of July, according to Iris
Encinias, NMMFA housing tax credit administrator.

The total dollar amount of the 2004 Indian financings was not immediately
available, but NMMFA provided Indian Country Today a tally sheet that shows
it has arranged $17.5 million in finance for Native projects over the last
dozen years.

NMMFA’s biggest year to date in Indian housing finance was 1999, when it
awarded $5.16 million in tax credits to three tribes and arranged another
$600,000 through the RHED program.

One of the deals, a $2.27 million award to the Navajo Townsite project, was
marred when the Navajo withdrew (part of their giant reservation is in New
Mexico). But Picuris received $1.5 million; Santo Domingo $1.4 million; and
Isleta, Santo Domingo and Picuris divided $600,000 in RHED grants for
infrastructure and project management of tax credit deals.

The tax credit program, though funded by the federal government, is
administered through the state housing agencies. Each state receives a per
capita amount of $1.75 per person in the state. Since Indians are counted
in the per capitas, Indian projects are eligible. Reflecting hostility
between state and tribal governments, some states have yet to grant tax
credits to Indian housing projects, but that’s not the case in New Mexico.

NMMFA’s biggest Indian housing financing to date appears to be at the San
Juan pueblo, where in 2001 – 2002 it awarded more than $3 million in tax
credits to the Tsigo Bugeh multifamily project, made a loan of $180,000,
and arranged $300,000 in HUD HOME money (HOME is another federal program
managed by the MFA).

The second biggest appears to be a $2,089,650 tax credit grant to a project
on the Pojoaque pueblo in 2000.

The tax credit program functions to funnel outside investment into Indian
country, which is well known as an “equity desert.” Tribes usually pay no
federal taxes, and therefore do not need income tax credits. So they sell
the tax credits to investors, who thus have an equity stake in the
projects. Institutional investors that have bought equity in New Mexico
Indian tax credit deals include mortgage agency Fannie Mae and a unit of
the Enterprise Foundation.

Other big deals have included a $2 million loan guaranty for construction
of housing at Isleta, Sandia, Jemez and other pueblos during the 1990s and
a $1.24 million tax credit/HOME financing for the Shiprock, N.M. chapter of
the Navajo Nation Chaco River project last year.

The Primero loan program, which has tribal projects as one of its main
goals, has also been used (in 1997) to provide a low interest (3 percent)
loan of $30,000 to the Tohatchi (N.M.) Special Education and Training
Center, for construction of a group home.

NMMFA over the years has made grants for Indian legal work, a feasibility
study for a loan program, scholarships for Native students, Indian housing
fairs, rehabs and weatherization improvements and counseling sessions.

Much of the work has been done under the leadership of Jim Stretz, the
recently departed executive director of NMMFA (Katherine Miller has been
named to replace him). Lynn Wehrli is NMMFA’s Native specialist.

NMMFA created its Native American Housing Initiative in 1993 as a unit of
its Housing Opportunity Fund. Its purpose is “to promote the development of
affordable owner-occupied, rental or special needs residential facilities
on Native American trust lands in New Mexico.” It places a priority on
projects that leverage funds from other sources.

The agency is planning to run a bi-annual Governor’s Housing Summit next
month in Albuquerque, and the Aug. 25 – 27 meeting will feature a panel on
Indian housing issues.


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New Mexico MFA Funds Indian Housing