The city of Charleston, two recent mayors and Charleston Citywide Local Development Corp. have entered into a settlement agreement that resolves a lawsuit filed by the city and mayors earlier this year.
Charleston, Mayor John Tecklenburg and former Mayor Joe Riley sued the LDC in March over allegations that the nonprofit was withholding $22.8 million that the city had earmarked for affordable and workforce housing projects. The funds originated from a grant the city received and made available to the LDC to assist with the development of Charleston Place in the 1980s.
In the settlement, the LDC will direct the majority of the $22.8 million toward helping solve the city’s affordable housing issues. The nonprofit will transfer $10 million to Charleston for the city to use in the development of affordable housing. In addition, the LDC will establish a permanent revolving fund for affordable housing development loans with $9.2 million.
“The LDC is excited to apply its three decades of innovative community development finance experience to the challenge of workforce and affordable housing in Charleston,” said Steve Saltzman, CEO of the LDC, in a news release. “We look forward to working hand-in-hand with the city to make sure the funds are distributed in the most innovative and effective ways possible.”
The remaining $3.6 million will be used by the LDC to provide small business loans in the city of Charleston, and potentially other parts of the region if necessary to find enough qualified applicants.
“This partnership with the LDC, allows us to not only bring needed funding to address the critical workforce housing shortage, but also to support important projects across the City such as One80Place,” Tecklenburg in a news release. “Working with LDC, we will utilize their rich experience in providing innovative funding solutions to businesses in the area to now help developers create affordable housing efficiently and effectively.”