icon Blueprint for October

Funding’s Never Fun

3 min read

Prior to taking on this assignment of chronicling the affordable housing and tax credit industry, I spent 25 years in the treacherous but glamorous business of producing shows on Broadway. The lead producer is the CEO of a production with all the responsibilities that role entails in any business, first and foremost being financing the effort. For 25 years, I woke up each morning and said to myself, “I have to raise money today.”

Primarily what I produced were large-scale musicals, which at that time, a decade ago now, were each budgeted in the $10 to $12 million range. The most generous investors contributed $1 million each—and there was just a short list of them who every producer in town competed for. On Broadway, only about a quarter of the new shows produced each season return their investment. So, what you are confronting when you first sit down with a potential funder is extremely bad odds. What you have to offer is the glamour along with prestige, primarily amongst the New York and Hollywood in-crowd: access to the best seats for your friends and business associates; a hopefully star-filled and swank opening night party; backstage visits to dressing rooms to impress your guests; and your name above the play’s title on posters, in programs, in some newspaper ads. (Oh, if we only had tax credits to offer! And a building that had lasting value.)

Raising money is always hard. A lot of people make promises they don’t keep. Phone calls go unreturned. Those with resources often put you through the mill for something extra or special for their investment – a bigger slice of the pie, more say in decision-making, their name larger than everyone else’s, a job for their daughter, the star at their son’s bar mitzvah. What you learn when you attempt it as an occupation is to maintain great respect for those who are able to do it repeatedly. And a lot of empathy.

This is our annual Historic Tax Credit issue. But this year we’ve expanded the subject a bit to look at using historic credits as a part of multi-credit deals. I have been observing this business for the almost 40 years my brother Peter has worked in it and I have always been impressed by the creativity of those who raise the funds. Like the unique non-managing member owner structure created by NEF to preserve the Church Community Housing Corporation’s Harbor House in Newport, RI, a one-time convent now converted to senior affordable housing. (Case Study: Harbor House) Or the use of Medicaid waivers to supplement housing subsidies and support the residents of Evergreen Village, an assisted living affordable housing facility in Bloomington, IN. (Case Study: Evergreen Village) Or, historic consultant Bill MacRostie’s detailed explanation of using historic credits in acquisition/rehabilitation projects.

Two gentleman who have been successfully raising funding their entire careers are Joe Wishcamper and Joe Hagan, this year’s recipients of the annual NH&RA Vision Awards. Staff writer Mark Olshaker ushers you through each of those impressive careers (A Couple of Joes). And we congratulate them both.

And while we are on funding, we cannot ignore the recent reform proposals coming out of HUD and Treasury on housing and homelessness, which are assessed by our columnists Thom Amdur and David A. Smith.

We’re not naïve enough to think we can make funding easy, but perhaps the stories in this issue will spark ideas that make it just a little bit easier for you.

Marty Bell, Editor