The Alexandria City Council has approved a $3.5 million loan to the Alexandria Redevelopment Housing Authority (ARHA) for construction at the site of the Samuel Madden Homes, The Berg.
The redevelopment of the Berg is moving forward but ARHA needs cash now to avoid having to borrow money.
“This money will allow us to get a better rate on our tax credits and to avoid paying interest on bank loans, so will save the project money,” said A. Melvin Miller, the chairman of the ARHA Board. “As soon as we have the money from the tax credits, we will pay the city back.”
Up to $3.5 million in city funds was approved for the project last year, so ARHA was not asking for additional monetary support.
“The funds will be transferred from our capital projects account and replaced when ARHA receives the money from the tax credits,” said Deputy City Manager Mark Jinks.
“I want to make sure that everyone understands that this is a loan,” said Vice Mayor Redella "Del" Pepper at Council meeting Tuesday night. “In the past, we have loaned ARHA money and have ended up forgiving the loans. That is not the case here.”
Final contracts are being signed and construction is expected to begin early next year.