ALBANY COUNTY — A new report from the Rural Housing Coalition of New York highlights the discrepancy in state tax-credit allocations for low income housing in rural areas, exacerbating other socioeconomic issues that rural areas often face, like aging populations and persistent poverty. 

The report looked at the distribution of three kinds of credits handed out by the state as part of the federal low-income housing tax credit, namely: 

— Four-percent federal tax credits, “which are allocated to projects receiving tax-exempt bond financing”;

— Nine-percent federal tax credits, “which are awarded through a competitive process”; and 

— State Low Income Housing Tax Credits, which supplement the federal tax credits. 

The key finding was that over a five-year period beginning in 2019, rural areas received less than a fifth (17.5 percent) of the 4-percent tax credit, even though rural areas contain more than a third of the state’s low-income population outside of New York City (36.2 percent). 

This means that developers are not being properly incentivized to invest in low-income housing developments in rural areas, despite a high need. 

The report says that, although rural areas are receiving a proportionate amount of the 9-percent tax credits, the vast majority (70 percent) of affordable-housing projects are attached to the 4-percent credits, so the incentivization gap is still large. 

Part of the problem, the report acknowledges, is that 4-percent credits are typically associated with high-volume projects — around two-thirds of the projects had over 100 units — which are difficult to build in rural areas because of the low population density and lack of infrastructure. 

Many in the Helderberg Hilltowns are aware of past efforts to build a senior-housing complex that fizzled out because of the logistical challenges, leaving the area’s elderly, and especially the low-income elderly, without many options for senior-friendly living. 

Compounding the affordability issue is the fact that, according to Harvard University’s Joint Center for Housing Studies, rural home prices rose disproportionately during the COVID-19 pandemic, jumping 36 percent in three years. 

“This report indicates that more needs to be done to fund housing programs that target smaller and rural communities that are left out of a major funding source for affordable housing development,” Rural Housing Coalition Executive Director Michael J. Borges said in a statement. 

“State policymakers need to continue to invest in programs targeted to rural and smaller communities like the Small Rental Development Initiative (SRDI), the USDA 515 Rural Preservation Program, as well as ensure that the allocation of all types of tax credits are more fairly distributed.”