Federal Home Loan Bank of San Francisco Awards $505,000 in Affordable Housing Program Grants in Arizona

Business Wire, Jan 22, 1996

TUCSON, Ariz.--(BUSINESS WIRE)--Jan. 22, 1996--The Federal Home Loan Bank of San Francisco is awarding a $125,000 grant to "Home, by Primavera Builders, Inc.," a residential construction and rehabilitation project that will create 26 new homeownership opportunities for low-income families in the cities of Tucson and South Tucson.

The award was announced today at a groundbreaking ceremony for the "Home" project. Sponsored by Primavera Builders, Inc., the project was entered in the Federal Home Loan Bank of San Francisco's semiannual Affordable Housing Program competition by Arizona Bank, the permanent lender for the project.

Two other Tucson-area housing developments are among the grant recipients being announced by the Home Loan Bank today: the Tucson Affordable Sustainable Homeownership Program, sponsored by the City of Tucson, has been awarded $80,000; and the Twin Lakes Project in Catalina, sponsored by the United Housing and Educational Development Corporation, has been awarded $110,000. Arizona Bank is the permanent lender for both of these projects, as well.

The Bank also awarded $40,000 to the New Opportunities Program in Mesa and $150,000 to the HOMESTART LISC project in Phoenix. "Arizona did well in both rounds of the 1995 Affordable Housing Program competition," said Gary L. Curley, senior vice president of the Federal Home Loan Bank of San Francisco.

"The Bank awarded a total of $2.8 million to 14 Arizona projects in 1995, far exceeding the amounts awarded in the previous five years. This recent success is a tribute to the capacity-building that has been going on in the state and to the development of effective partnerships among lenders, housing developers, community organizations, and local and state government agencies."

The Bank announced the overall results of its recent AHP competition today. In total, 61 housing programs were awarded $9 million, creating over 2,300 new units of affordable housing in Arizona, California, and Nevada. A majority of the winning projects -- over 75 percent -- will serve individuals and families that earn less than 50 percent of the median income for the area in which they live.

The 61 winning projects will leverage approximately $274 million in total development costs. Since the first round of the Bank's Affordable Housing Program in 1990, the Bank and its shareholders have committed $85 million to 410 housing programs, supporting the creation of over 21,000 units of affordable housing.

The Federal Home Loan Bank of San Francisco's Affordable Housing Program awards grants to projects that address community needs in creative ways and that make the most effective use of the money. The funds are derived from the Bank's net earnings, which would otherwise be paid as dividends to shareholders. In effect, Bank members forgo approximately 10 percent of their earnings on Bank stock to support these projects.

Each competing project must be sponsored by a financial institution that is a member of the Bank, usually in conjunction with a community-based affordable housing sponsor. "The Bank's mission is to help community-oriented lenders make housing more accessible and more affordable," said Dean Schultz, President and Chief Executive Officer of the Federal Home Loan Bank of San Francisco. "Our shareholders have made lending in low- and moderate-income neighborhoods a significant part of their everyday business, and they rely on us to provide them with low-cost funding when they need it. The Affordable Housing Program makes it possible for our shareholders to reach those with even greater need and fosters enduring relationships between lenders and community organizations, helping to revitalize neighborhoods and sustain healthy communities."

The Federal Home Loan Bank of San Francisco promotes housing and homeownership by expanding the supply and reducing the cost of mortgage credit. The Bank serves and is owned by commercial banks, credit unions, savings institutions, and thrift and loan associations headquartered in Arizona, California and Nevada. As of December 31, 1995, the Bank had 178 shareholders. With approximately $51 billion in assets, the Bank is the largest of the 12 banks in the Federal Home Loan Bank System.

A list of the Arizona projects that have been awarded subsidies in this round follows. Individual descriptions of each project, including contact names and phone numbers, are available upon request. -0-