The New Jersey Housing and Mortgage Finance Agency (HMFA) recently announced the Affordable Housing Production Fund Program and has set aside up to $305 million to provide subsidy financing for projects that are 100 percent affordable and are included in an approved Mount Laurel Fair Share Settlement Agreement. The AHPF is expected to increase the number of affordable housing units to be financed by 2025 by more than 3,300 units. The subsidy will be made available for gap financing on housing projects that utilize the four percent LIHTC Program and Tax-Exempt Bond Financing from HMFA. AHPF Program funds may not be utilized in conjunction with conduit financing.
Given the finite nature of the State of New Jersey’s volume cap allocation, coupled with strict federal expenditure deadlines associated with the AHPF funding, projects applying to the Affordable Housing Production Fund Program may take priority over other proposed uses of agency volume cap. Accordingly, proposed projects seeking large volume cap allocations, meaning any request in excess of $30 million, will be subject to additional scrutiny and may be deferred to a subsequent year as part of balancing the various competing needs for volume cap at this time. Should you anticipate presenting a large volume-cap request to the Agency in the near future, please be mindful of these constraints, seek to minimize the scale of the request being submitted, and come in to discuss the project proposal with staff early in the development process to better benchmark expectations regarding the size of and timing for your proposed issuance.
