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Funding Programs for Affordable “Workforce” Housing (50–80% AMI) in Louisville and Nationally

Di Tran

Affordable housing for households earning 50% to 80% of Area Median Income (AMI) – often termed “workforce housing” – is supported by a patchwork of federal, state, and local funding sources. Below is a comprehensive overview of current funding programs and incentives available in Louisville, Kentucky (and beyond) for developments targeting this income range. Each program summary includes its objectives, income targeting, eligibility, application process highlights, funding levels, and examples of best practices. Finally, we outline how Di Tran Enterprise (a for-profit developer) and the New American Business Association Inc. (NABA) (a 501(c)(3) nonprofit) can position themselves as competitive leaders in leveraging these resources.

Federal Funding Programs and Incentives

Federal programs provide the backbone of affordable housing finance. These programs are designed to spur private and nonprofit development of affordable units, often through tax incentives, block grants, or below-market financing. Key federal sources that support 50–80% AMI housing include:

  • Low-Income Housing Tax Credit (LIHTC) – (Treasury/IRS, administered by states)
    Overview: LIHTC is the nation’s largest affordable rental housing program. It provides federal tax credits to developers of affordable housing, which are sold to investors to raise equity. In exchange, the housing must be affordable to low-income households (traditionally <=60% AMI) for at least 30 years. Recent changes allow “income averaging,” meaning a LIHTC project can include units up to 80% AMI as long as the overall average income limit is 60% (). This makes LIHTC more flexible for mixed-income workforce housing projects.
    Income Targeting: At least 40% of units must be affordable to eligible households (for LIHTC, “low-income” is defined as <= 60% AMI by default). With the income averaging option, some units can serve 70% or 80% AMI households if balanced by lower-income units so that the average does not exceed 60% (). This allows inclusion of moderate-income families up to 80% AMI. Deeply affordable units (<50% AMI) can still be included but are not required under the income averaging model.
    Eligibility: For-profit or nonprofit developers apply through the state housing finance agency (in Kentucky, Kentucky Housing Corporation (KHC)) for annual LIHTC allocations. States must set aside at least 10% of credits for nonprofit-sponsored projects, so partnerships with nonprofits (like NABA) can improve competitiveness. Projects are awarded credits via a Qualified Allocation Plan (QAP) scoring system that typically favors readiness, financial feasibility, cost efficiency, and serving priority populations. In Kentucky’s QAP, factors such as project location, tenant needs, energy efficiency, and developer experience also affect scoring.
    Application Process: LIHTC applications are highly competitive 9% credits (which provide a larger subsidy) and also available as 4% credits with tax-exempt bond financing (see below). KHC’s Universal Funding Application (UFA) allows developers to apply for LIHTCs and supplemental gap financing in one process ([ Multifamily Programs - Small Multifamily Affordable Loan Program (SMAL)

](https://www.kyhousing.org/Partners/Developers/Multifamily/Programs/Pages/Small-Multifamily-Affordable-Loan-Program.aspx#:~:text=KHC%27s%C2%A0Multifamily%20Programs%20department%C2%A0offers%20one%20application,funding)) ([

                    Multifamily Programs 
					-
                    Small Multifamily Affordable Loan Program (SMAL)

](https://www.kyhousing.org/Partners/Developers/Multifamily/Programs/Pages/Small-Multifamily-Affordable-Loan-Program.aspx#:~:text=KHC%27s%C2%A0Multifamily%20Programs%20department%C2%A0offers%20one%20application,funding)). Developers must show site control, project plans, and financing commitments. Projects are scored and ranked; top-scoring projects receive an allocation of credits. The 9% credit statewide volume in Kentucky is limited (roughly $12–13 million in credits per year, equating to ~$120M in private equity). Unsuccessful 9% applicants often pursue 4% credits with bonds if feasible.
Funding/Award Amounts: A typical 9% LIHTC award in Kentucky might provide equity covering ~70% of a project’s development cost. Credits are allocated for 10 years; for example, a $1 million annual credit award yields $10 million in credits, which can generate roughly ~$8–9 million in equity (depending on pricing). Kentucky’s per-project credit cap (per the QAP) ensures funds are spread among multiple projects. For 4% LIHTC projects, developers must obtain tax-exempt bond financing that covers >50% of development cost to trigger the credits automatically (these credits are less competitive but also less subsidy per unit).
Best Practices/Examples: Louisville has leveraged LIHTC for workforce housing by combining it with local support. For instance, LDG Development (a Louisville-based developer) has used 4% LIHTCs with bonds to build large mixed-income complexes. Jefferson’s Landing (240 units in Okolona) is one example of a new project that utilized LIHTC equity plus other funds (More than 4,800 new affordable housing units created in Louisville since January 2023). LIHTC projects in Louisville often layer local gap financing (Louisville Affordable Housing Trust Fund or Louisville CARES loans) to include units at a mix of 30%, 50%, and 80% AMI. To be competitive, Di Tran Enterprise and NABA could partner to apply – Di Tran Enterprise bringing development expertise and NABA qualifying for nonprofit points and providing resident services (a factor that can boost scoring for LIHTC in some states). Such a team could excel in delivering a high-quality project that meets QAP priorities (e.g. serving families or seniors, in a revitalization area, etc.).

  • HOME Investment Partnerships Program (HOME) – (HUD block grant to states/localities)
    Overview: HOME is a federal block grant focused exclusively on creating and preserving affordable housing. Louisville Metro Government and KHC both receive HOME funds annually to distribute as loans or grants for housing development. HOME is flexible – it can finance rental units, homeownership units, or rehab of existing affordable housing. It often fills financing gaps in LIHTC deals or smaller projects. It is one of the primary federal sources to support 50–80% AMI units, especially for homeownership.
    Income Targeting: HOME funds primarily serve households <= 80% AMI. For rental projects, HUD requires that 90% of HOME-assisted rental units in each project are occupied by households at or below 60% AMI, and the remaining 10% can go up to 80% AMI. Additionally, in projects with 5+ HOME-assisted rental units, at least 20% of units must be at or below 50% AMI (these are designated “Low HOME Rent” units with deeper affordability). For homebuyer projects (down payment assistance or development of affordable homes for sale), HOME can assist buyers with incomes up to 80% AMI. In sum, HOME can indeed support the 50–80% AMI band, although rental projects will typically include a mix of some units below 50% to meet the program rules.
    Eligibility: Nonprofit or for-profit developers, as well as consortiums, can apply for HOME funds through the local participating jurisdiction (Louisville’s Office of Housing & Community Development) or through KHC for areas outside Louisville. Community Housing Development Organizations (CHDOs) – nonprofit developers that meet certain HUD criteria – are eligible for a 15% set-aside of HOME funds. NABA Inc. could seek CHDO status to access this dedicated funding stream. Applicants must demonstrate capacity and that the project is financially viable with the amount of HOME requested.
    Application Process: Louisville typically issues Notices of Funding Availability (NOFAs) or includes HOME in its Affordable Housing Development Program (AHDP) applications. For example, Louisville Metro’s HOME Affordable Housing Development Program provides “gap financing” loans to developers to cover the last dollars needed for a project’s viability (SERIES 2021 AN ORDINANCE APPROVING A FORGIVABLE LOAN …). Applications require project details, budgets, and compliance with HUD regulations (e.g. property standards, long-term affordability covenants of 20+ years). The process may involve competitive scoring if requests exceed available funds. KHC similarly offers HOME funds via its UFA process, often alongside LIHTC or other programs.
    Funding Levels: Louisville’s HOME allocation varies yearly (roughly $2.5–$4 million per year in recent years). For Program Year 2023, Louisville Metro Government allocated about $2.75 million in HOME (plus required local matching funds) for housing projects ([PDF] Louisville-Jefferson County Metro Government Program Year 2023 …). KHC also receives HOME funds to deploy statewide. Individual project awards might range from a few hundred-thousand dollars for a small project up to $1+ million for larger developments, depending on needs and caps.
    Best Practices/Examples: A local example is Habitat for Humanity of Metro Louisville, which has received HOME funds as forgivable loans to build or rehab homes for sale to 50–80% AMI first-time homebuyers (SERIES 2021 AN ORDINANCE APPROVING A FORGIVABLE LOAN …). On the rental side, nonprofits like Housing Partnership Inc. often use HOME loans from Louisville Metro to develop mixed-income projects. Best practices include leveraging HOME with other funds (each HOME dollar typically must be matched with 25% non-federal funds), and ensuring long-term compliance (HOME imposes affordability periods of 20 years for new rental construction). For Di Tran Enterprise and NABA, using HOME effectively might mean NABA becoming a CHDO and sponsoring a project – gaining access to the CHDO set-aside – while Di Tran Enterprise handles development. This pairing could score well in local HOME competitions, as it checks the box for community-based nonprofit involvement and capacity.
  • Community Development Block Grant (CDBG) – (HUD block grant to cities/counties)
    Overview: CDBG is a broad federal grant for community development, which Louisville Metro receives annually (as an “entitlement community”). CDBG funds can be used for a wide range of activities, including housing rehabilitation, site acquisition, infrastructure for housing developments, demolition of blight, and even new construction of housing (if done by a nonprofit). The primary requirement is to benefit low- and moderate-income persons, which includes households up to 80% AMI. Louisville often uses CDBG for housing rehab programs, homebuyer assistance, and to support affordable housing projects indirectly (e.g. acquisition of land or gap financing).
    Income Targeting: At least 70% of a locality’s CDBG funds must benefit low- or moderate-income persons (≤80% AMI). This means CDBG-funded housing units typically must be occupied by households at 80% AMI or below. Unlike HOME, CDBG does not require specific percentages at 50% AMI – thus it is well-suited to projects targeting the 50–80% range (though many programs choose to serve lower income levels for greater need). For example, a CDBG-funded rental rehab could income-restrict units at 80% AMI. CDBG is also commonly used for home repair programs for low-income homeowners and those usually serve up to 80% AMI.
    Eligibility: Local governments or nonprofits apply internally through the city’s allocation process. In Louisville, the Office of Housing accepts proposals for CDBG funding as part of its Consolidated Plan/Action Plan process. Nonprofits (including CHDOs and CDCs) are often subrecipients of CDBG for housing activities – for instance, New Directions Housing Corporation and Habitat for Humanity receive CDBG for repairs and new construction respectively. For-profit developers can indirectly benefit, for example if the city uses CDBG to fund infrastructure or site prep for an affordable housing development that a for-profit is building. All CDBG projects must meet a national objective (here, typically “benefit to low/mod income persons”) and comply with federal rules (environmental reviews, labor standards, etc.).
    Application Process: Louisville’s process involves soliciting project proposals during the annual Action Plan development. The city may issue requests for proposals for certain eligible activities (e.g. a competitive RFP for nonprofits to do home repairs, or for developers to partner on a scattered-site infill housing initiative). If Di Tran Enterprise and NABA have a specific project (say, turning a vacant building into mixed-income apartments), they could approach Louisville Metro to request CDBG assistance (such as funds to cover site acquisition or remediation costs). The Metro Council and Mayor ultimately approve the CDBG budget each year. In FY2024, Louisville administered roughly $17 million in HUD Community Planning and Development (CPD) formula funds (including CDBG, HOME, ESG, HOPWA) ([PDF] Pathways to Removing Obstacles to Housing (PRO Housing …), with CDBG being the largest share.
    Funding Levels: Louisville’s CDBG entitlement for housing and community development is on the order of ~$10–$12 million per year ([PDF] Pathways to Removing Obstacles to Housing (PRO Housing …). Of that, a portion is carved out for housing. For example, the city’s new comprehensive housing strategy “My Louisville Home” (released Oct 2023) recommended dedicating $1.2 million of CDBG for certain housing programs ([PDF] Louisville-Jefferson County Metro Government Program Year 2024 …). CDBG funds can be granted or loaned (if loaned, program income returns to the city for reuse). There is typically a 15% cap on using CDBG for public services, but housing development costs are considered capital and not subject to that cap.
    Best Practices/Examples: Louisville Metro has successfully used CDBG to rehabilitate vacant homes and resell them to moderate-income families (through partners like River City Housing). Another example is the Louisville Affordable Housing Trust Fund initially receiving some CDBG seeding for its activities. Lien Forgiveness Pilot Program: In 2022, Louisville launched a pilot using CDBG to forgive code liens on abandoned properties to encourage redevelopment into affordable homes (Louisville pilot program to forgive liens, create affordable housing). Best practice is to use CDBG as flexible “glue” money – e.g., to fund predevelopment, infrastructure, or rehab where other funds (like LIHTC or HOME) don’t cover. Di Tran Enterprise and NABA could seek CDBG support for predevelopment grants or gap financing especially in projects that revitalize blighted sites (aligning with CDBG’s community development mission). Leveraging NABA’s nonprofit status, they might apply for CDBG as a subrecipient to, say, run a home repair program tied to their housing developments or to acquire lots through the Metro Landbank for new construction.
  • Federal Housing Administration (FHA) Multifamily Loans (HUD/FHA Insurance Programs) –
    Overview: HUD, through FHA, offers federally-insured mortgages for multifamily housing development or rehabilitation. The Section 221(d)(4) program (for new construction/substantial rehab) and Section 223(f) program (for acquisition/refinance of existing properties) are key tools. These are not grants or direct funding, but they provide credit enhancement: by insuring the lender against default, FHA enables private lenders to offer better loan terms (fixed low interest, long amortization) for affordable or mixed-income housing projects. FHA loans are often used in conjunction with LIHTC or other subsidies to finance the debt portion of a project. Notably, FHA allows high loan-to-value ratios and longer terms than conventional financing, which is very helpful for projects targeting 50–80% AMI rents (which can’t support high debt payments).
    Income Targeting: FHA multifamily programs do not impose income limits on residents (HUD 221(d)(4) Loans). They can be used for market-rate projects as well. However, FHA incentivizes affordable housing by offering higher leverage and lower insurance premiums for projects that have affordable units. For example, under 221(d)(4), a project that is at least 90% affordable (as defined by HUD, typically <=80% AMI rents) can qualify for a 90% loan-to-cost financing (HUD 221(d)(4) Loans) (HUD 221(d)(4) Loans), whereas a market-rate project might be limited to 85% LTV. Additionally, FHA charges reduced Mortgage Insurance Premium (MIP) for affordable projects (e.g., 0.45% annual MIP for LIHTC or Section 8 properties, vs 0.65% for market-rate) (HUD 221(d)(4) Loans). In short, FHA loans are especially favorable when used to create affordable/workforce housing, but they can finance mixed-income developments that include units up to 80% AMI or higher.
    Eligibility: Any capable multifamily developer (nonprofit or for-profit) can apply for an FHA-insured loan through HUD-approved lenders. The project must meet FHA underwriting criteria for feasibility. There is no competitive award; it is a rolling application for a loan guarantee. The 221(d)(4) program requires some experience and financial capacity from the development team given its complexity. Di Tran Enterprise could benefit from 221(d)(4) financing on a new 50–80% AMI apartment project, obtaining a 40-year fixed-rate loan at a high leverage. FHA also has specific programs like Section 220 for housing in urban renewal areas and Section 223(f) (which can refinance or acquire properties with moderate rehab, up to 35-year terms, similarly allowing ~87% LTV for affordable properties (Market Rate vs. Affordable Properties in Relation to HUD 221(d)(4 …) (Market Rate vs. Affordable Properties in Relation to HUD 221(d)(4 …)).
    Process: Developers typically engage a lender or mortgage broker specializing in HUD loans. There is a HUD pre-application, then full application with detailed market studies, architectural plans, and cost reviews. HUD loans undergo environmental and prevailing wage requirements. The timeline is longer than conventional loans (it can take 6+ months to get to closing), but the payoff is a very favorable loan. Importantly, using FHA doesn’t preclude layering other subsidies – it’s common to have LIHTC equity, local loans, etc., all alongside an FHA-insured first mortgage.
    Funding Levels: FHA doesn’t provide “funding” per se but enables loans often in the tens of millions. For example, a $20M development could potentially get an ~$18M FHA-insured loan (90% LTC) if largely affordable (HUD 221(d)(4) Loans). There is theoretically no maximum loan size; projects can be large. This high-leverage debt reduces how much gap financing is needed from other sources.
    Best Practices/Examples: Nationally, FHA 221(d)(4) has been used to build many workforce housing projects. One example is a mixed-income apartment complex where 20% of units are affordable at 80% AMI and the rest are market-rate – it could still qualify for an FHA loan (though not the absolute highest leverage unless it hits 90% affordable threshold). In Louisville, developers could use FHA loans to complement programs like LIHTC. For instance, an FHA-insured loan combined with 4% LIHTCs and Louisville CARES funds could finance a new 100-unit development with rents from 50% to 80% AMI. As competitive leaders, Di Tran Enterprise and NABA can capitalize on FHA financing to scale projects: Di Tran Enterprise’s capacity in development and NABA’s nonprofit mission could attract favorable consideration (HUD likes to see experienced sponsors and community support). By securing an FHA-insured loan, they would show strength in financing, making their proposals to other funders (like LIHTC or local trust funds) more credible.
  • Federal Home Loan Bank (FHLB) Affordable Housing Program (AHP) – (Federally regulated bank grant program)
    Overview: The Affordable Housing Program is a competitive grant program offered by the network of Federal Home Loan Banks. FHLB members (local banks) partner with housing developers to apply for AHP funds, which are grants or very low-interest loans for affordable housing. Kentucky is served by the FHLB of Cincinnati. Each year, FHLB Cincinnati offers AHP funds to projects in its district (Kentucky, Ohio, Tennessee). This is a significant public-private partnership model: the funds come from the FHLB (which is a private cooperative of banks but federally chartered) and are allocated through a competitive scoring process.
    Income Targeting: AHP requires that at least 20% of units in a rental project are for households <=50% AMI, but it allows the rest of the units to go up to 80% AMI (the program’s definition of moderate income) or even market-rate. Many AHP-funded projects serve an income mix. For homeownership, AHP can assist buyers up to 80% AMI. Given our focus on 50–80% AMI, AHP is very relevant – it explicitly includes moderate-income households in its eligibility, while ensuring some benefit to lower-income households.
    Eligibility: Both nonprofit and for-profit developers can benefit, but an application must be submitted through a member bank of the FHLB. Typically, a developer will secure a sponsorship from a local bank that is an FHLB member, and the bank submits the application on their behalf. NABA, as a nonprofit, might partner with a community bank in Louisville to sponsor an AHP application for a new housing project. The project can be rental or ownership. Projects are scored on criteria such as: need for subsidy, targeting of lower incomes, readiness, community impact, and member financial involvement. Because AHP is competitive across the multi-state district, having a strong local partner (member bank) and a compelling project (especially with some units at 50% AMI or serving special needs) can improve chances.
    Application Process: FHLB Cincinnati holds one or two application rounds per year. The developer prepares a detailed application (similar to a mini-business plan for the project, including budgets, other funding sources, project timeline, etc.). The member bank submits it. The awards are typically announced a few months later. If awarded, the project gets a grant (or deferred loan) agreement and must comply with AHP monitoring for 15 years. In terms of timeline, aligning an AHP application with other funding is key – developers often apply once LIHTC or other primary funding is secured, to fill any remaining gap.
    Funding Levels: AHP grants can be quite substantial. Often, up to $500,000 – $1,000,000 per project is available (FHLB Cincinnati’s maximum grant amount in recent rounds has been around $750,000 per project for rental, and similar for ownership, though this can vary). Louisville projects have successfully won AHP awards – it’s a notable source of gap funding. The overall AHP pool depends on FHLB profits; for example, FHLB Cincinnati awarded $6.9 million to 10 projects in one recent year, including projects in Kentucky () (note: this example figure is illustrative; exact current pools would be found in FHLB’s annual AHP results).
    Best Practices/Examples: Best example: St. Cecilia Apartments (hypothetical example) – a nonprofit-led rehab of a historic school into 30 affordable units in Louisville – might combine LIHTC and FHLB AHP funds. The AHP grant could provide $500k to cover costs that LIHTC equity and city funds don’t. A real-case example: many projects by Housing Partnership, Inc. in Louisville have used AHP alongside HOME and LIHTC to create units affordable at 50–80% AMI. From a public-private standpoint, AHP is considered a best practice model itself, and other states have similar state-administered trust fund competitions. For Di Tran Enterprise and NABA, pursuing AHP funds would demonstrate savvy layering of financing. By engaging a local bank (perhaps one of NABA’s partners in the business community) as a sponsor, they could secure additional subsidy without tapping limited local public funds, strengthening their project’s financial stack. This also shows Metro Council that the project maximizes private-sector contributions.
  • Other Federal/Quasi-Federal Resources:
    In addition to the major programs above, a few other federal initiatives can support 50–80% AMI housing:
    • Section 108 Loan Guarantee (HUD CDBG) – Louisville Metro can borrow against its future CDBG allocations (Section 108 loans) to provide upfront financing for large housing projects. This essentially turns CDBG into a low-interest loan fund. For example, the city could use Section 108 to finance infrastructure or site acquisition for a new housing development, repaid over time with CDBG. Developers working with the city on transformative projects (e.g. mixed-use affordable developments) might access this tool.
    • New Markets Tax Credits (NMTC) – A federal tax credit aimed at economic development in low-income areas, NMTC can sometimes be used in mixed-use projects that include affordable housing (particularly if there’s a significant non-residential component like a community facility or if the housing is part of a broader neighborhood revitalization). While housing-only projects typically use LIHTC instead, Di Tran Enterprise and NABA could explore NMTC for projects that, say, include a workforce training center (aligning with NABA’s mission) plus moderate-income apartments. The NMTC could finance the commercial component, indirectly supporting the housing’s viability.
    • HUD Choice Neighborhoods and HOPE VI – These are competitive federal grants to revitalize distressed housing (usually public housing) into mixed-income communities. Louisville’s recent Russell neighborhood “Choice Neighborhoods” grant (for Beecher Terrace redevelopment) is an example. However, those target very low-income replacement units with some higher-income mix. Since our focus excludes <50% AMI, these are less directly applicable, but they illustrate a source of large-scale federal investment that can include some 60–80% AMI units as part of mixed-income strategies.
    • USDA Rural Development Programs – While Louisville proper is urban, elsewhere in Kentucky, USDA offers programs like Section 515 loans and Section 538 guaranteed loans for affordable rentals in rural areas, often serving up to moderate incomes. If Di Tran Enterprise and NABA ever expand to suburban/rural Jefferson County or beyond, these could be relevant (Section 538, for instance, guarantees loans for housing up to 115% AMI in rural areas).
    • Infrastructure and Climate Grants – New federal funds (e.g., from the 2021 Infrastructure law or 2022 Inflation Reduction Act) sometimes include grants for energy efficiency or resilience upgrades in affordable housing. While not housing-specific, they can reduce development costs (for example, grants for solar panels or improved insulation in a new affordable housing project). Using these could make a proposal more competitive by showing innovation and long-term savings for residents.

Kentucky State Programs (Kentucky Housing Corporation and State Initiatives)

The state of Kentucky supports affordable housing primarily through Kentucky Housing Corporation (KHC), the state housing finance agency. KHC administers federal programs (like LIHTC, HOME, and the National Housing Trust Fund for extremely low-income housing) and also state-funded programs. For housing targeting 50–80% AMI, state resources include:

  • Allocation of Low-Income Housing Tax Credits (KHC) – As noted, KHC runs the LIHTC program for Kentucky. While LIHTC is federal, the state’s role is crucial in shaping priorities via the QAP. Kentucky’s QAP can influence how many moderate-income units are created. For instance, KHC’s QAP allows the Income Averaging set-aside (enabling 80% AMI units) and may offer scoring incentives for projects that include a mix of incomes or are in higher-income (“high opportunity”) areas. KHC also decides the per-capita credits distribution across urban/rural pools. For Louisville-specific projects targeting workforce housing, staying attuned to KHC’s QAP updates is vital. Currently, Kentucky does not have a state-level LIHTC (no state income tax credit like some states have) – though the idea has been discussed as a way to further incentivize affordable housing () (). If such a state LIHTC program is created in the future (as Ohio and other neighbors have done), it could become a significant funding source. Di Tran Enterprise and NABA should monitor state legislation on this front to capitalize early if it comes.
  • Kentucky Affordable Housing Trust Fund (AHTF) –
    Overview: The AHTF was established by the state legislature in 1992 to help finance housing for very low-income Kentuckians ([ Partners - Affordable Housing Trust Fund (AHTF)

](https://www.kyhousing.org/Partners/Pages/AHTF.aspx#:~:text=T%20he%20AHTF%20was%20established,of%20the%20area%20median%20income)). It is funded by a portion of fees from real estate document recordings (currently a $6 fee per recorded deed or mortgage statewide). Over time, receipts have declined relative to need (the fee hadn’t been increased in ~20 years) (). The AHTF provides grants or loans to support housing development and rehab. By statute, it serves households at or below 60% of median income, with a priority for those <=30% ([

                        Partners -
                        Affordable Housing Trust Fund (AHTF)

](https://www.kyhousing.org/Partners/Pages/AHTF.aspx#:~:text=T%20he%20AHTF%20was%20established,of%20the%20area%20median%20income)). Thus, it overlaps partially with the 50–80% AMI band (serving up to 60%). It’s not designed for the full workforce housing range but is worth noting for projects that include some units at 50–60% AMI.
Eligible Activities & Application: KHC administers the AHTF. Funds are often used as gap financing in affordable housing projects. For multifamily, only nonprofit organizations may apply ([

                        Partners -
                        Affordable Housing Trust Fund (AHTF)

](https://www.kyhousing.org/Partners/Pages/AHTF.aspx#:~:text=)), encouraging partnerships or nonprofit-led development. Eligible uses include matching funds to secure other federal dollars and direct financing of new construction or rehab for low-income units ([

                        Partners -
                        Affordable Housing Trust Fund (AHTF)

](https://www.kyhousing.org/Partners/Pages/AHTF.aspx#:~:text=)). Projects using AHTF get a 30-year affordability deed restriction ([

                        Partners -
                        Affordable Housing Trust Fund (AHTF)

](https://www.kyhousing.org/Partners/Pages/AHTF.aspx#:~:text=housing%20units)). The application is through KHC’s Universal Funding Application (the same portal as LIHTC/HOME), meaning a developer can request AHTF as one piece of a financing package. Because AHTF prioritizes <60% AMI, a project with units at 60% and 80% might only count the <=60% units for AHTF funding. For example, NABA could apply to AHTF for a project that has a mix of 60% and 80% units – AHTF could cover the 60% units portion.
Funding Level: Historically, the AHTF has been underfunded relative to demand. Receipts from the $6 recording fee provide a few million dollars per year statewide. (In some years, KHC had around $4–5 million to allocate, which they spread across rental and homebuyer programs.) Recognizing this shortfall, the 2025 Kentucky legislature is considering House Bill 588 to substantially increase the recording fee and channel more revenue to AHTF (CitizenPortal.ai – Kentucky clerk fees support affordable housing trust fund) (CitizenPortal.ai – Kentucky clerk fees support affordable housing trust fund). HB 588 (2025) proposes raising the fee to $50, with $23 of that going to the AHTF (CitizenPortal.ai – Kentucky clerk fees support affordable housing trust fund). If enacted, this could generate a significant new annual funding source to support affordable housing (tens of millions annually) – a game changer for state support of 50–60% AMI units.
Best Practices/Notes: While AHTF’s focus is very low-income housing, it can complement a workforce housing project by ensuring a portion is deeply affordable. A best practice in other states is to have parallel programs for moderate incomes; Kentucky’s approach has been to attempt to bolster AHTF and consider new tools. Di Tran Enterprise and NABA, with NABA as a nonprofit, could tap AHTF for portions of projects serving <=60% AMI. Their leadership in advocating for HB 588 and similar measures (showing policymakers the demand for workforce housing funds) could position them as champions in the field. In applications, emphasizing how their project helps those 50–60% AMI while still being sustainable with some 80% AMI units could align with AHTF’s mission and any future expansion of it.

  • KHC Gap Financing Programs (HOME, NHTF, SMAL, etc.) –
    KHC often layers multiple funding sources to fill gaps in affordable housing deals across Kentucky. While some of these (HOME, National Housing Trust Fund) are federal, KHC’s management effectively makes them state programs for developers. Key resources include:
    • National Housing Trust Fund (NHTF): A federal fund allocated to states, focused on extremely low-income (<=30% AMI) housing. (By requirement, 90% of NHTF must serve <=30% AMI, and 10% up to 50% AMI.) Because this is below the 50% AMI threshold, NHTF isn’t aimed at workforce housing. It is mentioned for completeness, but we will not focus on it given the 50–80% AMI scope.
    • Small Multifamily Affordable Loan (SMAL) Program: This is a KHC-created program to encourage development of smaller rental projects (up to 11 units) by offering favorable financing. It’s essentially a revolving loan fund providing permanent and construction loans for small projects that might be too high-income or small to easily use LIHTC ([ Multifamily Programs - Small Multifamily Affordable Loan Program (SMAL)

](https://www.kyhousing.org/Partners/Developers/Multifamily/Programs/Pages/Small-Multifamily-Affordable-Loan-Program.aspx#:~:text=The%20Small%20Multifamily%20Affordable%20Loan,the%20SMAL%20Program%20is%20that)) ([

                    Multifamily Programs 
					-
                    Small Multifamily Affordable Loan Program (SMAL)

](https://www.kyhousing.org/Partners/Developers/Multifamily/Programs/Pages/Small-Multifamily-Affordable-Loan-Program.aspx#:~:text=Rents%20should%20be%20projected%20at,income%20level%20of%20the%20targeted)). SMAL is very flexible and can be combined with other KHC financing to reach lower incomes ([

                    Multifamily Programs 
					-
                    Small Multifamily Affordable Loan Program (SMAL)

](https://www.kyhousing.org/Partners/Developers/Multifamily/Programs/Pages/Small-Multifamily-Affordable-Loan-Program.aspx#:~:text=match%20at%20L123%20Program%20is,income%20families)). While its primary goal is increasing supply for lower-income households, its existence shows KHC’s recognition that not all affordable housing is large-scale. SMAL could potentially support, say, a 10-unit rehab of a historic building into workforce apartments by Di Tran Enterprise and NABA, if the tenants are low/moderate income.

  • Tax-Exempt Bonds (Private Activity Bonds): KHC can issue tax-exempt housing revenue bonds (or local authorities can, thanks to state allocation of bond volume). These bonds, when used to finance a rental housing development, allow the project to also get 4% LIHTCs. Kentucky’s volume cap for private activity bonds is a resource that KHC often dedicates to rental housing. In 2023–2024, Kentucky, like many states, faced bond cap scarcity due to high demand from housing deals. The new SB 25 (2025) in Kentucky (discussed below under local tools) will make it easier for local governments to issue bonds for housing, complementing KHC’s efforts (New Tool Aims to Ease Kentucky’s Housing Shortage | Bricker Graydon LLP – JDSupra) (New Tool Aims to Ease Kentucky’s Housing Shortage | Bricker Graydon LLP – JDSupra).
  • HOME (State-administered): Outside Louisville, KHC distributes HOME funds to projects in smaller cities and counties. They sometimes also invest HOME in Louisville projects (particularly if a Louisville project scores highly in a state competitive process, KHC might award state HOME or even AHTF to it). KHC’s HOME funds can serve up to 80% AMI for homeownership or 60% for rental, similar to Louisville’s HOME usage as described earlier.
    In summary, KHC acts as a one-stop shop: through the Universal Funding Application, a single project may request LIHTC, HOME, AHTF, and other KHC-controlled funds ([ Multifamily Programs - Small Multifamily Affordable Loan Program (SMAL)

](https://www.kyhousing.org/Partners/Developers/Multifamily/Programs/Pages/Small-Multifamily-Affordable-Loan-Program.aspx#:~:text=KHC%27s%C2%A0Multifamily%20Programs%20department%C2%A0offers%20one%20application,funding)). This integrated approach lets KHC balance the needs – for instance, if Di Tran Enterprise/NABA propose a project, KHC could award LIHTCs and also a HOME loan for the 60% AMI units, and perhaps a small AHTF grant for a few 50% AMI units. Being aware of all these moving parts and tailoring the application to fit KHC’s criteria is essential for success at the state level. As a competitive edge, NABA (as a nonprofit) could pursue the nonprofit set-aside of LIHTC and also be eligible for programs like AHTF and SMAL that favor nonprofits, thus increasing the chances of a state-awarded package of funds.

  • New State Legislation & Economic Development Initiatives:
    Kentucky is actively exploring new tools to boost housing, including workforce housing:
    • Industrial Revenue Bonds (IRBs) for Housing: In an exciting recent development, Senate Bill 25 (2025) was passed, enabling local governments to issue IRBs for certain multifamily housing projects of 48 or more units (New Tool Aims to Ease Kentucky’s Housing Shortage | Bricker Graydon LLP – JDSupra) (New Tool Aims to Ease Kentucky’s Housing Shortage | Bricker Graydon LLP – JDSupra). IRBs are bonds that a city/county issues on behalf of a private project; as a result, the property can be owned by the government entity for tax purposes, making it exempt from local property taxes during the IRB lease term. Essentially, this is a property tax abatement tool: the developer pays a negotiated Payment In Lieu of Taxes (PILOT) instead of full taxes (New Tool Aims to Ease Kentucky’s Housing Shortage | Bricker Graydon LLP – JDSupra). Additionally, IRBs can be tax-exempt if the project meets federal criteria (which typically align with LIHTC income set-asides). SB 25 immediately empowers Louisville Metro to assist developers like Di Tran Enterprise in financing or tax-abating large affordable housing projects. This public-private mechanism will lower operating costs (via tax savings), which is crucial for moderate-rent projects’ feasibility. Competitive positioning: Di Tran Enterprise and NABA should engage with Louisville Metro on potential IRB usage – being early adopters of this tool could make them front-runners. If they propose a 100-unit development with predominantly 80% AMI units, an IRB could be issued to cover construction costs (repaid by project income) and they’d benefit from a PILOT arrangement that keeps property taxes affordable. Metro Council will likely be eager to utilize SB 25 to spur housing, so a well-crafted project that meets the criteria could get fast-tracked assistance.
    • State Housing Infrastructure Fund & Other Initiatives: Kentucky’s 2024 Housing Task Force highlighted models from other states – such as Oklahoma’s $215M housing loan program (0% interest construction loans for 24 months) () and Montana’s large investments in workforce housing (e.g., a public-private shared equity program for households 60–140% AMI, and $107M for housing infrastructure grants) (). These examples may inform future Kentucky programs. Already, in 2022, Kentucky dedicated $20 million of ARPA funds to create a Rural Housing Trust Fund for workforce housing in eastern Kentucky (for disaster recovery, administered by KHC) – indicating bipartisan recognition of housing needs. Going forward, Di Tran Enterprise and NABA should remain involved in state-level advocacy and pilot programs. If Kentucky establishes a revolving loan fund for middle-income housing or a state tax credit, being “first in line” with a project will demonstrate their leadership.

Louisville Metro Programs and Incentives

Louisville Metro Government has taken significant steps in recent years to address the local affordable housing shortage, including those at workforce income levels. The city deploys local general funds, federal grants, and innovative partnerships to support developers and nonprofits building affordable units. Major Louisville-specific funding sources include:

  • Louisville Affordable Housing Trust Fund (LAHTF) –
    Overview: The LAHTF is a local trust fund created by Metro Council ordinance in 2008 as a vehicle to invest local public funds into affordable housing (Louisville Affordable Housing Trust Fund | National Low Income Housing Coalition). It functions as a nonprofit entity (with its own board) but is primarily funded by allocations from Louisville Metro’s budget. The Trust Fund’s mission is to address housing needs for low- and moderate-income residents – including working families, seniors, veterans, and people with disabilities whose incomes often fall in the 50–80% AMI range (Louisville Affordable Housing Trust Fund | National Low Income Housing Coalition). Each year, Metro appropriates funds (subject to budget approval) to LAHTF, which in turn issues loans or grants to support housing development or preservation. The Trust Fund emphasizes leveraging other funds and focusing on the gap that other programs don’t cover.
    Income Targeting: By policy, LAHTF funds can serve households up to 80% AMI. In fact, the city stipulates certain portions to go to lower income tiers: for FY2025, of the $14 million allocated for development activities, at least $5M must support units at or below 30% AMI, at least $2.5M for 31–50% AMI, and the balance can be used for 51–80% AMI units (Programs – Louisville Affordable Housing Trust Fund). Thus, roughly $6.5 million (or more) of the FY2025 funds are available for that upper-range “workforce” band (Programs – Louisville Affordable Housing Trust Fund). This ensures the Trust Fund addresses needs across the spectrum while explicitly including 50–80% AMI housing. All LAHTF-assisted housing must be affordable to those at 80% AMI or below () (with “affordable” defined as housing+utilities costing no more than ~30% of income for that income level).
    Eligible Activities: LAHTF can finance a variety of development costs: property acquisition, new construction, rehab of vacant houses, adaptive reuse of vacant buildings, and even preservation of existing affordable housing (to prevent loss of affordability) (Programs – Louisville Affordable Housing Trust Fund) (Programs – Louisville Affordable Housing Trust Fund). It is flexible in the form of assistance – offering low-interest loans, gap financing, and even forgivable loans or grants where needed (Programs – Louisville Affordable Housing Trust Fund) (Programs – Louisville Affordable Housing Trust Fund). For example, LAHTF might provide a 20-year deferred loan at 0% interest to make a project’s pro forma work, or a construction loan that converts to a grant if the project serves extremely low-income tenants. A portion of the funds ($3M in FY25) is reserved as a Revolving Loan Fund to replenish capital over time (Programs – Louisville Affordable Housing Trust Fund). LAHTF also set aside $100K for supportive housing services grants in FY25 to ensure residents in funded projects can access services (Programs – Louisville Affordable Housing Trust Fund).
    Application Process: LAHTF and the city’s Louisville CARES program use a joint online Pre-Application portal to streamline requests (Programs – Louisville Affordable Housing Trust Fund). Developers first submit a pre-app summarizing their project; Trust Fund staff then direct them to the appropriate funding source (LAHTF or CARES or other) and invite a full application if eligible. The 2025 Funding Application Guidelines detail underwriting criteria and requirements. Applicants pay a $350 fee and must provide substantial documentation (development team qualifications, site info, project budgets, etc.) ([PDF] The Affordable Housing Development Program Guidelines). Projects are evaluated on factors like: affordability achieved (deeper affordability can be favored), number of units, cost-effectiveness, location (e.g. proximity to amenities or in areas of need), readiness to proceed, and capacity of the sponsor. The Trust Fund has an annual $10M goal (unmet as a dedicated revenue) (Programs – Louisville Affordable Housing Trust Fund), but recent budgets have exceeded that – $15M was allocated in June 2024 for FY25 (Programs – Louisville Affordable Housing Trust Fund), up from $10M in FY23 (Louisville Affordable Housing Trust Fund | National Low Income Housing Coalition). This increase is partly thanks to one-time federal relief funds (ARP) and strong advocacy.
    Funding/Awards: For FY2025, $14M is available for projects (excluding admin) (Programs – Louisville Affordable Housing Trust Fund). Typically, LAHTF might fund 10–20 projects per year, with individual awards ranging widely based on project size – small rehab projects might get <$100k, while large rental developments have received $1–2M in loans. One recent example: Volunteers of America’s “Monarch Station” development – a supportive housing project – received a combination of Louisville Metro ARP dollars and LAHTF funds (ARP Louisville Affordable Housing – ArcGIS StoryMaps). Another example: Louisville Scholar House (family housing for student-parents) was supported by LAHTF. Trust Fund dollars often leverage at least 5:1 in other investments (Programs – Louisville Affordable Housing Trust Fund), demonstrating impact. Notably, in 2021, Metro Council dedicated $100 million of American Rescue Plan (ARP) funds to affordable housing, much of which flowed through LAHTF and Louisville CARES (New affordable housing units open in Louisville Metro). This unprecedented infusion turbocharged the production of units. (Indeed, from Jan 2023 to Jan 2025, Louisville claims 4,800 new affordable units were created using federal, local, and private funds (More than 4,800 new affordable housing units created in Louisville since January 2023) – a testament to these investments.)
    Best Practices/Positioning: LAHTF has become a model for local housing trust funds, balancing deep affordability with workforce housing. It prioritizes projects that might not happen but for its support. For Di Tran Enterprise and NABA, engaging with LAHTF is key – they could either apply directly or partner with other nonprofits to utilize funds. NABA’s nonprofit status is advantageous because the Trust Fund often works closely with nonprofit developers (though for-profits can receive funds too, especially if serving policy goals). To be competitive, Di Tran Enterprise and NABA should highlight: how their project meets Metro housing goals (e.g. creating units for 60–80% AMI in a location with job access), how much other funding they bring (leveraging LIHTC, private loans, etc.), and any innovative aspects (like integrating workforce training or financial counseling for residents through NABA – aligning with LAHTF’s supportive services grants). By aligning their proposals with LAHTF’s objectives, they can become go-to partners for the Trust Fund, potentially even securing multi-year support. Leadership-wise, their advocacy for a dedicated funding source for LAHTF (the long-term goal of $10M/year dedicated revenue (Programs – Louisville Affordable Housing Trust Fund)) would also position them as policy champions, not just applicants.
  • Louisville CARES (Creating Affordable Residences for Economic Success) –
    Overview: Louisville CARES is a local revolving loan fund specifically aimed at expanding affordable multifamily housing for households at or below 80% AMI (Louisville CARES | National Low Income Housing Coalition) (Louisville CARES | National Low Income Housing Coalition). It was launched in 2015 by Mayor Fischer with an initial capitalization of $12 million (general obligation bond funds) and grew to about $18.93 million by 2019 (Louisville CARES | National Low Income Housing Coalition). The program’s concept is to provide low-interest loans (and occasionally grants) to developers to help finance new construction or preservation of affordable units, particularly to alleviate “cost burden” for moderate-income working families (Louisville CARES | National Low Income Housing Coalition). Unlike the Trust Fund, which has significant focus on very low-income, Louisville CARES was from the start designed to boost workforce housing production (80% AMI and below) (Louisville CARES | National Low Income Housing Coalition).
    Loan Terms and Use: Louisville CARES offers development loans – often as subordinate, gap loans behind primary financing. These loans might be interest-only during construction and then amortizing at a low rate (or sometimes deferred) for a 20 to 30-year term. The affordability period required is at least 30 years (Louisville CARES | National Low Income Housing Coalition). By providing this patient capital, CARES enables developers to borrow more than they could from banks alone, thus closing the funding gap on an affordable project. The projected cost per unit subsidized was around $16,000 in early estimates ([PDF] Louisville CARES Fact Sheet – LouisvilleKY.gov), meaning a $12M fund could help roughly 750 units. In practice, by 2023, Louisville CARES has supported over 1,100 units of affordable housing since inception ([PDF] Pathways to Removing Obstacles to Housing (PRO Housing …). Funds may be used for rental projects (and possibly for mixed-income projects as long as the affordable units are maintained). There are “no other eligibility requirements” beyond income and project feasibility according to program info (Louisville CARES | National Low Income Housing Coalition) – meaning it doesn’t impose special population targets; it’s purely focused on increasing the stock of <80% AMI units.
    Application Process: As noted, LAHTF and Louisville CARES share a pre-application portal (Programs – Louisville Affordable Housing Trust Fund). Typically, if a project is more in the 60–80% AMI range and can repay a loan, it might be steered to Louisville CARES, whereas a project with mostly <50% AMI units needing grants might go to LAHTF. Once invited, a full application for CARES would include details on development costs, projected rents, operating pro forma, and how the loan will be repaid. The city’s Develop Louisville office administers CARES, with loans approved by Metro officials. CARES loans often require a recorded agreement ensuring the affordability and outlining recourse if the project fails to comply.
    Funding Levels: Louisville CARES had $18.93M total funding (as of 2019) (Louisville CARES | National Low Income Housing Coalition). In 2021, Metro Council boosted affordable housing funding with ARP dollars – some of that likely replenished CARES. For instance, the Metro Council’s $100M ARP allocation mentioned above partially went into Louisville CARES (alongside the Trust Fund) (New affordable housing units open in Louisville Metro). So, by 2022 the revolving loan fund had more capital to deploy. Typically, CARES might provide loans in the range of $500k to $3M to a single project, depending on size. For example, a 200-unit development might receive a $2M CARES loan to achieve rents affordable at 60–80% AMI. Because it’s a revolving fund, as loans are repaid, the money becomes available for new loans – making it a sustainable resource if well-managed.
    Best Practices/Examples: A notable project is Riverport Landings, a large mixed-generation housing campus by LDG Development: it benefited from a $7 million Louisville CARES loan (one of the largest) to create 248 affordable units for families and seniors at 60% AMI, alongside a daycare and supportive services ([PDF] The Power of Community – Federal Reserve Bank of St. Louis). This showcased how the city can partner on big projects that meet both housing and community needs. Another example: St. Cecilia (mentioned hypothetically earlier) received a CARES loan to convert a vacant school into lofts for moderate-income renters. From a policy perspective, Louisville CARES is considered a success, though the need far exceeds available funds (hence the push for more dedicated funding). For Di Tran Enterprise and NABA, a CARES loan could be an ideal fit for their projects: being mission-driven but also looking to create economically sustainable developments, they could leverage CARES for low-interest financing. To be competitive, they should highlight in applications the economic benefits of their project – e.g. “Housing for teachers, healthcare workers, and service industry employees” – aligning with the CARES emphasis on housing for those whose wages otherwise result in cost burden (Louisville CARES | National Low Income Housing Coalition). Also, showing a strong repayment plan (perhaps supplemented by NABA’s support services to ensure occupancy and stable tenancy) will give Metro confidence in their loan. By successfully utilizing and repaying Louisville CARES loans, Di Tran and NABA establish a strong track record, positioning themselves as trusted partners for future larger deals (possibly accessing even more Metro support or private capital).
  • Affordable Housing Development Program (AHDP) & Other Louisville Metro Initiatives –
    Beyond LAHTF and CARES, Louisville’s Office of Housing & Community Development runs various programs that developers can tap into:
    • Affordable Housing Development Program (AHDP): This is essentially the mechanism by which Louisville deploys its federal HOME and sometimes CDBG funds, as well as local dollars, to specific development projects. When you see Metro Council approve an ordinance for a “forgivable loan to Habitat for Humanity pursuant to the HOME Affordable Housing Development Program” (SERIES 2021 AN ORDINANCE APPROVING A FORGIVABLE LOAN …), that is AHDP in action. AHDP provides gap financing loans (which may be forgivable or low-interest) to cover the difference between a project’s cost and the private debt and equity it can support (SERIES 2021 AN ORDINANCE APPROVING A FORGIVABLE LOAN …). It’s very similar in function to the Trust Fund and CARES, but it’s funded by federal grants and city general funds directly rather than a separate pot. For developers, the practical approach is to respond to NOFAs or RFPs for AHDP funding. In 2023, for example, Louisville issued a NOFA for winter 2022 HOME/CDBG funds, indicating at least $2.75M HOME (plus match) was available for housing projects ([PDF] Louisville-Jefferson County Metro Government Program Year 2023 …). AHDP also encompasses special allocations like HOME-ARP (one-time ARP-funded HOME dollars) which Louisville may use for supportive or transitional housing needs. The competitive scoring in AHDP will look at similar factors: project readiness, cost per unit, populations served (projects serving 50–80% AMI would qualify as benefiting low/mod income), and the developer’s capacity.
    • Down Payment Assistance (DPA): While not a development subsidy, Louisville’s DPA program provides grants (often ~$20k per buyer) to help first-time homebuyers at ~80% AMI purchase homes (More than 4,800 new affordable housing units created in Louisville since January 2023). This is relevant to developers of affordable for-sale housing: a builder like Di Tran Enterprise could market newly constructed townhomes to 80% AMI buyers who bring city DPA to the table, thus expanding the pool of qualified buyers. Metro recently increased DPA funding by $1M to assist ~30 more families, given high demand (More than 4,800 new affordable housing units created in Louisville since January 2023). For NABA, which works with immigrant and new American communities, promoting DPA and even partnering to offer homebuyer education could strengthen their role in the housing ecosystem (and potentially fulfill any HUD counseling requirement tied to DPA).
    • Metro Surplus Land / Landbank: Louisville Metro owns vacant lots and structures, especially through the Landbank Authority. The city often makes these properties available at nominal prices ($1 or low cost) to developers who commit to create affordable housing. This is an indirect but valuable subsidy – lowering land acquisition cost. For example, Metro’s Affordable Housing Lien Forgiveness Pilot is making hundreds of vacant properties (with tax or code liens) more viable for rehab by forgiving those liens if a developer will renovate for affordable homeownership (Louisville Metro launching Affordable Housing Lien Forgiveness …) (Louisville pilot program to forgive liens, create affordable housing). Di Tran Enterprise and NABA can capitalize on these initiatives by acquiring Landbank lots for infill housing construction targeted at 80% AMI buyers, or by identifying a lien-encumbered abandoned house, getting liens forgiven, and using AHDP funds to rehab it for sale or rent. Such projects, while scattered-site, can cumulatively add affordable units and showcase neighborhood revitalization – a big win for Metro Council districts blighted by vacant properties.
    • Property Tax Abatement/PILOT: Before SB 25 (the new IRB law), Louisville already had the ability in some cases to structure PILOT agreements for affordable housing (often via the housing authority or industrial revenue bonds for non-housing projects). With SB 25, this will likely be more routine. Metro Council can approve PILOT deals that greatly reduce the local property taxes on affordable developments (common practice for LIHTC projects in many jurisdictions to improve cash flow). This incentive doesn’t provide upfront money but improves the long-term sustainability of moderate-rent projects. Developers should engage with Metro early to explore PILOT if they anticipate tight operating margins due to serving 50% AMI tenants.
    • Federal Grants via City/Partners: Louisville occasionally pursues competitive federal grants that benefit affordable housing. A current example is the HUD “PRO Housing” grant which Louisville is seeking; if awarded, it could bring additional funding that the city might channel into innovative housing programs or gap financing. Keeping track of such opportunities (and offering to pilot any new approach) would further establish Di Tran Enterprise and NABA as leaders.

Public-Private Partnerships and Other Funding Opportunities

In addition to government programs, there are collaborative initiatives and private funding sources that can support affordable housing in the 50–80% AMI range:

  • Community Development Financial Institutions (CDFIs): CDFIs like LISC (Local Initiatives Support Corporation) and Enterprise Community Partners, or regional ones like HOPE of Kentucky (a consortium of banks for affordable housing lending), provide low-cost loans, predevelopment financing, and capacity-building grants. Louisville has a LISC office that invests in housing and could offer technical assistance or bridge loans to projects that will use LIHTC or city funds. For example, a CDFI might give NABA a predevelopment loan to acquire a site, which is later taken out by construction financing. Some CDFIs administer Project Initiation Loans or recoverable grants to help nonprofits get a project “shovel-ready” – being ready is crucial to compete for the above-mentioned funds. Di Tran Enterprise and NABA can strengthen proposals by showing CDFI support, as it signals a level of vetting and partnership.
  • Federal Home Loan Bank (FHLB) AHP – Competitive Edge: We discussed AHP under federal programs, but it’s worth re-emphasizing as a public-private partnership: local banks (private sector) team up with developers to draw down FHLB funds (which are mandated by federal law). Many Louisville projects have benefitted from this. For instance, in 2020, an AHP grant helped finance the rehabs of St. Denis and St. William Apartments for low-income seniors, complementing LIHTC equity. The partnership aspect is key – a member bank like Republic Bank or Stock Yards Bank in Louisville not only submits the application but often contributes a small portion of its own funds or services to score higher. Engaging multiple banks (especially those needing Community Reinvestment Act credit) can also lead to direct investments or favorable loans into the project. This blend of private bank capital and AHP subsidy exemplifies leveraging private dollars for public good.
  • Employer-Assisted Housing & Philanthropic Grants: Large employers in Louisville (such as hospitals, universities, or manufacturers) sometimes partner to create housing for their workforce. While no formal citywide employer housing program exists yet, there is potential. For example, Norton Healthcare or UPS might donate land or funding for housing near their facilities for employees earning moderate incomes. Also, national philanthropies have launched housing challenge grants – e.g., JPMorgan Chase’s Partnerships for Raising Opportunity in Neighborhoods (PRO Neighborhoods) and Wells Fargo’s Housing Affordability Breakthrough Challenge – where innovative affordable housing models can win multi-million dollar awards. A Louisville project that, say, combines housing with workforce upskilling (which NABA could spearhead) could be a strong candidate for such competitions. Involving the Community Foundation of Louisville and local philanthropists (who have shown interest in housing through reports like “Louisville’s Prosperity”) can also yield grants for supportive services or pilot programs (e.g., a grant to cover the cost of on-site childcare in a workforce housing development).
  • Best Practice Examples (Public-Private): One best practice is the Oklahoma Housing Stability Program mentioned earlier – a huge infusion of state funds ($215M) to provide 0% construction loans (). This was a public fund executed likely in partnership with private developers, showing how removing interest can catalyze development. Another is Montana’s Community Reinvestment Plan (a public-private shared equity model for middle-income homeownership) (). For Louisville, a fitting analog could be creating a shared equity homeownership program for 80% AMI buyers: the city or a foundation invests in a portion of a home’s cost, making it affordable, and recoups that share upon resale. Di Tran Enterprise and NABA could pilot such a model – perhaps with a local bank CRA program – positioning themselves at the forefront of innovative financing. Additionally, public-private partnerships can include leveraging anchor institutions: e.g., working with University of Louisville to develop off-campus workforce housing with university guarantees, or partnering with health providers on the “housing is health” concept (some hospitals fund housing for frequent ER users, which tends to be lower-income supportive housing, but a preventative approach could be housing for low-wage hospital staff).
  • Local Housing Advocacy and Future Opportunities: Finally, being leaders means not only using current programs but shaping future ones. Metro Council and the new Mayor Greenberg administration are actively looking for “more funds and new policies” to support affordable housing (More than 4,800 new affordable housing units created in Louisville since January 2023). Opportunities on the horizon include: inclusionary zoning or incentive zoning (if implemented, could require or encourage developers to include 50–80% AMI units in market-rate projects, possibly with density bonuses or fee waivers), short-term rental fees dedicated to housing, expansion of the Landbank approach, and perhaps a Metro-backed housing bond issue to raise significant capital. Di Tran Enterprise and NABA, by demonstrating success with available programs now, build credibility to help design and utilize these future tools. For example, if Louisville were to establish a dedicated revenue (like a local option tax or bond) for housing, the city will look to proven developers to deploy that funding effectively. By documenting outcomes – e.g., how many families at 70% AMI they housed, how NABA’s services improved economic mobility for those families – they can make the case for scaling up such solutions.

Di Tran Enterprise and NABA as Competitive Leaders

Leveraging the above programs requires not just knowledge but strategic positioning. Di Tran Enterprise and NABA Inc. bring a powerful combination of strengths: a for-profit developer’s agility and a nonprofit’s community-driven mission. Here’s how they can stand out within these funding opportunities:

  • Align with Program Missions: Each funding source has its own objectives, and successful applicants tailor their projects accordingly. NABA’s mission of “elevating lives through workforce development and affordable housing” (as indicated on their site) fits perfectly with the ethos of workforce housing programs. By explicitly incorporating workforce development (job training, financial literacy, etc.) into housing projects, they can score bonus points in competitive applications that reward supportive services or community impact. For example, a LIHTC application could note that NABA will provide on-site employment counseling for residents – addressing cost burden by increasing incomes, which is a goal of Louisville CARES (Louisville CARES | National Low Income Housing Coalition). This kind of wrap-around approach can differentiate their proposal from a standard housing project.
  • Maximize Partnerships: As a team, Di Tran Enterprise (DTE) and NABA cover the spectrum of eligibility. Many programs favor or require nonprofit involvement (HOME CHDO, AHTF, FHLB AHP through a mission-based sponsor, etc.), which NABA can fulfill. Others are open to for-profits but demand capacity and financial strength, which DTE can provide. By always applying jointly or in tandem, they can check every box. For instance, in an LAHTF application, DTE+NABA brings both development experience and community trust – the review committee will see reduced risk in funding them. Likewise, in KHC’s LIHTC scoring, having NABA as a co-developer qualifies for the nonprofit set-aside and possibly points for minority-owned or female-owned business participation (if applicable to Di Tran’s ownership) and a track record of serving the targeted tenants. This synergy should be highlighted in every application: public funds go further when a capable developer and a grassroots nonprofit join forces.
  • Demonstrate Capacity and Readiness: To win competitive funding, projects must be shovel-ready and sponsors must show they can deliver. Di Tran Enterprise can lead on assembling land, preliminary architecture, and securing any necessary zoning – proving the project is “ready to go” pending funding. NABA can lead on community engagement – securing neighborhood support letters, local endorsements (e.g., from Metro Council members or civic groups). This one-two punch addresses common scoring criteria. Preparing ahead also means having robust data: e.g., a market study showing the need for moderate-income apartments in the chosen location, and letters of interest from prospective tenants or employers. This instills confidence in funders like KHC or LAHTF that the project will lease-up and succeed.
  • Leverage Financial Innovations: By utilizing programs like FHA 221(d)(4) loans or the new IRB property tax abatement, DTE and NABA can reduce the amount of subsidy they actually need – making their applications more cost-effective in the eyes of funders. If a project can come in asking the city for, say, $20,000 per unit in gap financing instead of $50,000 because they secured an FHA loan at 90% LTC and an IRB tax break, that project is more likely to get the limited dollars. Essentially, they should layer multiple sources to stretch each resource. A capital stack for a Louisville project might read: FHA first mortgage, LIHTC equity, Louisville CARES subordinate loan, LAHTF deferred loan, and sponsor equity from DTE. Such stacking shows sophistication and spreads risk, which selection committees appreciate. It also mirrors best-practice examples where diverse funding produced successful results (like Riverport Landings with bonds, tax credits, city loan, etc.).
  • Quantify and Qualify Impact: As leaders, they should measure outcomes. For every project, track how many units were created by AMI level (50%, 60%, 80%), how many formerly cost-burdened families obtained affordable homes, and any improvements in residents’ economic status (did some move from 60% AMI income to 80% after job training?). These metrics can be reported back to funders and used in future proposals to show a track record. Metro Council members, in particular, will value concrete numbers when justifying continued funding. If Di Tran Enterprise and NABA can say, “With $1M from the Trust Fund, we built 50 units and housed 50 families with incomes ~$40,000, and 10 of those families have since become homeowners through our program,” that is a compelling narrative for policy proposals. It shows the money isn’t just building units, but building upward mobility – aligning with the broader goals of these programs (to reduce cost burden and improve quality of life).
  • Advocacy and Thought Leadership: Finally, being a competitive leader is not only about projects but also about shaping the conversation. Di Tran and NABA can use their on-the-ground experience to advocate for improvements in these programs. For example, if they encounter obstacles (like overly restrictive rules or slow processes), they can propose solutions in public forums or to policymakers. They might join or form a coalition of affordable housing providers in Louisville to collectively push for that $10M dedicated LAHTF funding or a state workforce housing tax credit. By publishing op-eds or speaking at Metro Council and Frankfort hearings, they raise their profile as experts. This kind of engagement often indirectly benefits them in funding competitions – agencies know that funding leaders who are community advocates yields more bang for the buck. Moreover, funders like HUD or KHC often pilot new ideas with those who have shown initiative. For instance, HUD launched the Moving to Work (MTW) demonstration with housing authorities that had a track record of innovation; similarly, Louisville might pilot a new “housing investment fund” with a team like DTE/NABA that has consistently delivered results.

In summary, Louisville and Kentucky have an expanding toolkit to support 50–80% AMI housing – from federal tax credits to local trust fund loans. By expertly navigating these programs, Di Tran Enterprise and the New American Business Association Inc. can not only secure funding for their developments but also influence housing policy and demonstrate scalable solutions. Their dual capacity as a developer and a nonprofit positions them uniquely to harness every available dollar, build quality affordable homes, and empower the very households these programs intend to serve. With meticulous planning, partnership-building, and continued alignment with public goals, DTE and NABA can indeed become competitive leaders – setting a benchmark for affordable workforce housing development in Louisville and beyond.

Sources:

](https://www.kyhousing.org/Partners/Pages/AHTF.aspx#:~:text=T%20he%20AHTF%20was%20established,of%20the%20area%20median%20income)).

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