Council gives preliminary approval to serve as conduit issuer for 144‑unit affordable housing project

The Morganton City Council unanimously approved a preliminary inducement resolution to allow the city to serve as conduit issuer for a developer seeking to finance a proposed 144‑unit affordable rental development on approximately 25 acres on East Union Street.

City staff described the request as an opportunity to support affordable housing. The staff presentation said the developer — described in early remarks as Lynn Hart Landing Inc. and in the draft motion as Leonard Landing Apartments — is seeking roughly $12,000,000 in multifamily housing revenue bonds and additional funds from the North Carolina Housing Finance Agency and available disaster recovery funding for Western North Carolina.

City Manager (staff) emphasized that, for this conduit financing, "the city will have no legal responsibility, no financial risk, no liability whatsoever for the payment of the principal or interest on the bonds." Bond counsel would be McGuireWoods LLP and the developer would pay all associated costs; the city would receive a 1% issuer fee. Staff said the project would include a mix of studio, one‑, two‑ and three‑bedroom units targeted at households with incomes between 30% and 70% of area median income (AMI).

Why it matters: If the Housing Finance Agency and other funding partners approve the proposal, the project would add 144 rental units with an affordability focus and require multiple further actions and approvals, including the HFA application and subsequent council actions if the project advances.

Council approved the preliminary resolution to start the bond process; staff said subsequent actions, design reviews, and financing steps will return to council for additional approvals as the project moves through the HFA process.