Two more housing projects on Wednesday dipped into the $10 million pool created by the state legislature for economic development projects in the city.
The Illinois Development Finance Authority, which administers the fund, gave $955,427 to the Kenwood Oakland Development Corp. to aid construction of 70 rental townhomes at Lake Park Drive and 44th Place.
IDFA also approved $500,000 for construction financing of eight townhomes at 19th and Cullerton Streets by the 18th Street Development Corp. The money will be used to make the new homes affordable to moderate-income residents in Pilsen.
The state legislature created the Illinois Development Action Grant program in 1985 to supplement dwindling federal Urban Development Action Grant funds. The legislation, which authorized $10 million exclusively for Chicago, allowed funding of industrial, commercial or residential projects in low- and moderate-income areas of the city.
Six of the eight projects approved by IDFA since the program`s inception have been for housing, agency officials said. The agency Tuesday also approved $875,000 for the YMCA of Greater Chicago for an expanded community center at 63rd Street and Stony Island Avenue. That project will create 160 jobs.
The city came under criticism from community groups earlier this year for concentrating its use of the federal UDAG funds on commercial projects downtown that failed to meet their job projections. They also criticized the city for failing to generate industrial jobs with the funds.
The Kenwood-Oakland project meets the goals of the program by reserving 21 of the two- and three-bedroom townhomes for low-income people with rents around $300 a month, said Robert Lucas, president of the local development corporation. The other 49 units will have rents ranging from $575 to $675 a month.
”This is the first market housing built in this neighborhood in 50 years,” he said.
The project also will receive a $2.9 million loan from the Illinois Housing Development Authority and a $1.8 million housing grant from the federal govenment. The federal funds will be lost unless ground is broken by Sept. 30.
Most of the IDAG grant will be used to correct unforeseen soil conditions at the site. Project officials said the land was vacant for years and apparently had been mined for sand and filled with garbage by demolition contractors.
The grant to the Pilsen project, which had been reduced to eight townhomes from 18, will be used to provide a $10,000 writedown for the homebuyers from the $73,250 cost of construction and a $15,000 low-interest second mortgage.
”There will probably be moderate-income people who can buy these townhomes,” said Ron Bean, executive director of IDFA. ”But the requirements of the program will be met because they`re located in a low-income area.”
