WeVote
Log In

Bill

WeVote Research Nonpartisan
Bill Summary · HB 1072

Summary of HB 1072 (Session 2025) – Affordable Housing Infrastructure Development

Purpose and intent

  • Establishes the Affordable Housing Infrastructure Development Loan Program within the North Carolina Housing Finance Agency (NCHFA).
  • Goal: provide revolving, below-market interest rate loans to eligible borrowers to develop and improve sites for affordable housing for low- and moderate-income households.
  • Creates a dedicated fund (the Affordable Housing Infrastructure Development Fund) to support the program on a revolving basis.
  • Provides initial funding: $50 million (nonrecurring) from the General Fund for fiscal year 2026-2027.

Key provisions and changes

New program and fund

  • Program: Affordable Housing Infrastructure Development Loan Program.
  • Governing body: North Carolina Housing Finance Agency (NCHFA) to establish and administer the program.
  • Fund structure: A revolving loan fund (the Fund) from which loans are issued and repaid, allowing continued lending over time.

Eligible borrowers and financing terms

  • Eligible borrower: A tax-exempt nonprofit 501(c)(3) organization that meets several criteria, including:
    • Uses sweat equity of home buyers, volunteer labor, and donated materials/services.
    • At least one year of experience providing homes for sale to low- and moderate-income households in their service area.
    • No unresolved audits/monetary findings or ongoing legal proceedings.
    • Provides first or second mortgage financing to eligible home buyers at 0% interest.
    • If developing a mixed-income project, at least 40% of units must be reserved for low/moderate-income persons.
  • Loans: Made from the Fund, secured by liens on real property located in North Carolina, and issued through a competitive application process.
  • Below-market interest rate: Interest rate is below market value at the time of establishment and is fixed at closing.

Eligible uses and restrictions

  • Permitted uses (funds to be used for):
    • Acquisition of land.
    • Predevelopment costs (permits, surveys, environmental due diligence, soil testing, engineering/site planning).
    • Infrastructure costs (water, sewer, utilities, stormwater, roads, site clearing/grading).
  • Prohibited uses: Funds cannot be used for the vertical construction of housing units or the rehabilitation of existing housing units.
  • Targeted use for beneficiaries: The loan proceeds must benefit low- and moderate-income individuals; funds cannot be commingled into the borrower’s general account.
  • Disposition on sale: If the borrower sells land/improved property to a market-rate developer, the land must be sold at no less than its fair market value or appraised value (whichever is lower), and sale proceeds must be reinvested directly into projects that benefit low/moderate-income households.

Income metrics and definitions

  • Affordable housing: Housing deemed affordable by the Agency for low- and moderate-income households.
  • Area median income (AMI): Defined per U.S. HUD area figures.
  • Below-market rate: An annually published rate fixed at loan closing.
  • Low/moderate income definition: Households with incomes up to 80% of local AMI (adjusted for family size, per HUD).

Project and development requirements

  • Infrastructure focus: Emphasis on site development and improvements (e.g., utilities, drainage, roads) to enable affordable housing.
  • Predevelopment costs: Included in eligible expenditures.
  • Unit mix and affordability: For mixed-income developments, 40% of units must be reserved for low/moderate-income tenants.

Administration and reporting

  • Rulemaking: The Agency may adopt procedures for applying for assistance and is exempt from certain General Statutes (Article 2A of Chapter 150B) for procedures, with required public notice, comments, and hearings.
  • Reporting: As part of G.S. 122A-16 reporting requirements, the Agency must report the number of loans, loan amounts, and whether projects are located in low-, moderate-, or high-income counties as designated by the Agency.

Effective date

  • Effective date: July 1, 2026.

Who is affected

  • Eligible nonprofit borrowers (501(c)(3) organizations) that undertake affordable housing development using sweat equity and zero-interest for buyers.
  • Low- and moderate-income households who may benefit from new affordable housing projects financed under the program.
  • Communities and counties where projects are located, with data to be reported by income designation.
  • The North Carolina Housing Finance Agency, which administers the program and fund, including rulemaking and oversight.

Timeline and funding

  • Funding appropriation: $50 million (nonrecurring) from the General Fund for 2026-2027 to support the program.
  • Program start: Became effective July 1, 2026, following enactment.

If you’d like, I can add a side-by-side comparison with existing NC affordable housing programs or provide a quick FAQ for project developers considering applying.

Compiled from official sources — confirm details with the bill’s official record.

Sign in to ask a question.