The United Way of Dane County and community partners on Thursday announced the first housing project that will come out of a new county fund for supporting the creation of apartments geared toward lower middle-class renters.
Lorrie Heinemann, president & CEO of the Madison Development Corporation, said $11.8 million has been raised for the new Dane Workforce Housing Fund, which will be used to develop apartments that would be affordable for those whose incomes fall between 40% and 80% of the county median income, or between $36,160 and $67,950 for a family of three. Madison Development Corporation is managing the fund.
Rich Lynch, chair of the Economic Stability Council, a local group that has helped raise funds for the project, said the goal of the fund is to provide housing for “the missing middle,” working adults who make enough money that they don’t need social services or other assistance, but still can’t afford to live in Dane County.
The Economic Stability Council, the Madison Development Corporation and the United Way of Dane County have partnered together to create the fund.
“Thousands of our neighbors struggle to pay rent,” said Renee Moe, president & CEO of the United Way of Dane County.
Heinemann said the initiative aims to create 500 units of housing for those with modest incomes and keep those units affordable for at least the next 15 years.
The first use of the fund will be $900,000 to fill a gap in funding for a 39-unit apartment complex on University Avenue in Middleton.
Middleton Mayor Gurdip Brar said he was grateful that his city was picked for the first project. He said the location along the bus route and across from the shopping center is the “perfect place” for the lower-cost housing.
“Without this money, this project has been sitting there almost six months, and it would not have happened,” Brar said.
The 14 groups that invested in the fund include local businesses, foundations and banks. In a new model for raising housing funds, the investors will gain a “modest” profit from the housing developments over time, Heinemann said.
“By offering a modest return on investment versus asking for a donation, we’re creating a win-win situation for our investors and for our community,” Heinemann said.
Dane County Executive Joe Parisi said the Workforce Housing Fund “perfectly complements” other efforts already underway in the county to create housing geared toward those with even lower incomes.
Moe said the initiative provides support for lower middle-class families who normally don’t get assistance.
“This fund provides previously missing last dollars for those projects designed to house more Dane County families,” Moe said. “When we work together to increase the supply of affordable housing for our workforce, we are one step closer to achieving our collective vision of a Dane County where everyone can succeed in school, work and life – and that’s something to be excited about.”