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Few real-estate developers have the capacity or the perseverance to take on such a difficult undertaking as developing, or redeveloping, affordable housing.

"Sale On" (Mobtown Beat, April 9) questioned the effectiveness, the cost, and the beneficiaries of the Housing Authority of Baltimore City's (HABC) plan to sell current HABC properties to nonprofit and for-profit affordable housing developers under HUD's Rental Assistance Demonstration (RAD) program.

As one involved in developing and operating affordable senior housing, family housing, and housing for special-needs individuals nationwide for Volunteers of America, I know the difficulties faced by owners of aging housing properties. A faith-based, nonprofit human-services organization, Volunteers of America also operates significant human-service programs and housing in Baltimore and throughout Maryland. The heyday of federal funding of affordable, rental housing has been over for at least 20 years. Now, the only options vulnerable, very low-income residents have are living in these older properties.

HABC is taking the responsible step of utilizing what available tools are out there to renovate this extremely scarce and valuable housing. As Mr. Ericson notes, the Low Income Housing Tax Credit (LIHTC) was authorized in 1986 as a new, affordable housing production program, but, it should be noted, without any additional tenant subsidies. That is significant, as very low-income seniors and others at the bottom of the economic ladder would be faced with rents that eat into their funds available for food, utilities, and medicine, if not for the additional rental subsidies. The coupling of available RAD subsidies and LIHTC allows project sponsors to both renovate the buildings and keep the affordable rents needed by the most vulnerable.

Much is said in the article of how the tax credits seem to benefit developers and financial institutions interested in investing in the credits. LIHTC was structured as a private/public partnership, and coupling the tax credits with the RAD program builds on that model. Through LIHTC, private investment dollars provide equity in these developments which reduces the amounts needed to be borrowed through debt, which reduces the rents for the units in the buildings. Without LIHTC, rents would be much higher, impacting either residents' incomes or federal budgets, or both.

As for the developers partnering with HABC, the list represents a cross-section of well-respected nonprofit and for-profit affordable housing organizations. Developing affordable housing is a difficult business. The typical $19 million redevelopment, as Mr. Ericson points out, often takes five or more funding sources, each coming with complex affordability and use restrictions, and the need to meet specialized design, energy, and contracting requirements. Costs, including fees, are closely regulated and monitored by federal, state, and local agencies providing the funds. Frankly, few real-estate developers have the capacity or the perseverance to take on such a difficult undertaking as developing, or redeveloping, affordable housing.

HABC and its RAD partners should be applauded for taking on the difficult task of renovating these aging properties, home to many of the city's most vulnerable people. Without their partnership and programs like RAD and LIHTC, people with the greatest housing needs throughout the city and the country would be faced with fewer and fewer affordable housing options each year.

Patrick Sheridan

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Alexandria, VA

Corrections : In last week's City Folk ("Amped Rider," April 9), the headline misspelled Garry Moore's name as Gary.

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