The Metropolitan and Economic Development Committee on Monday voted to send proposal 16 to the full council, authorizing use of tax-increment funds from the city's Housing Opportunity Tax Increment Financing (HOTIF) program to support the Arnold Place townhome project.

Jeff Hasser, director of housing strategy for the Indianapolis Neighborhood Housing Partnership (INHP), told the committee the development will include 33 townhomes and that "a minimum of 51 percent of these homes will be affordable to buyers earning up to 80% of the area median income." He said construction began in 2024 and the first phase of 20 units is under contract and under construction.

The committee heard a breakdown of the proposed capital stack. Hasser said the project's hard and soft costs are estimated at about $13 million and that INHP expects to use a mix of funding including new markets tax credits, an Indianapolis African American Quality of Life Initiative award, ARPA funding, and HOTIF proceeds. He said the HOTIF allocation requested for Arnold Place is "1.6" million dollars as shown in the presentation and that INHP's total subsidy for an example buyer in the model would amount to about $230,000.

Hasser described how the buyer-side subsidy will work: the homes are listed at an appraisal-based sale price of $350,000 and INHP proposes down-payment assistance and a market-expander loan structure intended to lower borrower interest costs over time. On the assistance mechanism, Hasser said the down-payment money is structured as a grant with a recapture mortgage, explaining: "...there would be a mortgage attached to the property for that amount that's provided in down payment assistance. It's called what's called a recapture provision...we're anticipating a 30 year recapture period for this."

Councilors sought details about the proposal. Councilor Ron Gibson, whose district includes the project, praised the buyer-side subsidy and asked whether INHP remains in good standing with the Reagan Park neighborhood association; Hasser said he would defer to the neighborhood but that he had recently spoken with association members. Councilor Brian Mowery and others asked how the remaining financing gap for phase two would be closed; Hasser said INHP is pursuing an additional allocation of new markets tax credits and grant funding from the Federal Home Loan Bank's affordable housing program (AHP).

Councilor Bridal Delaney moved to send the proposal to the full council; the motion was seconded and carried on a voice vote.

The committee did not enumerate roll-call vote totals in the meeting transcript; the chair announced that the motion "carries." No councilor recorded a named "no" vote on the record.