Cotulla council backs resolution supporting 4% tax‑credit application for 60‑unit Whitetail Ridge project

Cotulla — The City of Cotulla voted to back a resolution supporting a 4% low‑income housing tax‑credit (LIHTC) application for the proposed Whitetail Ridge affordable‑housing development, a consultant told the council at a June workshop.

Peggy Broomhall, a housing consultant engaged by the city, told council members the project’s phase‑1 proposal calls for 60 subsidized rental homes near the elementary school aimed at working families such as hospitality workers and entry‑level teachers. ‘‘This phase‑1 is 60 homes that are subsidized by the federal government so that we can provide lower rents,’’ Broomhall said, describing a roughly $17,000,000 development and an aim to pair a later market‑rate phase with the subsidized units.

The council’s support is procedural: the resolution signals municipal backing of the application paperwork the developer must submit to seek bond‑financing tied to the 4% LIHTC program. Broomhall said the city previously sought the more generous 9% credit but was outcompeted this cycle and must pivot because the 4% program—while less generous—is still viable for the site. ‘‘The 9% pays for about 70% of a project; the 4% pays for roughly 30–35%,’’ she said, explaining why the 4% path requires a larger project and more local gap financing.

Broomhall and other speakers described the financing gap as roughly $5,000,000, a figure that will vary with tax‑credit pricing and project specifics. Possible local gap sources the presentation listed include a bank commitment (staff referenced about $1.2 million), a potential $750,000 grant from a Middle Rio Grande development entity, county participation, Economic Development Corporation tools and options to defer infrastructure costs through mechanisms like a TIRZ or similar arrangements. Broomhall said the developer is funding pre‑application costs and that the application was due June 16; a bond issuer committee meets in mid‑July, after which the city would have a reservation letter and about 180 days to close if selected.

Council members pressed for clearer estimates of Cotulla’s direct financial exposure and how any city contribution would be structured. Broomhall said the city’s ‘‘commitment letter’’ indicates intent to pursue the project and does not by itself obligate an immediate cash outlay; she added that some contributions could be in‑kind infrastructure (water, sewer, roads) rather than direct cash.

The council voted to adopt the supporting resolution. Next steps identified at the meeting included continuing grant and partner outreach, refining budget assumptions, and coordinating with the county and the local housing authority about possible project‑based vouchers and other supports. If the bond financing and all partners align, Broomhall said the developer expects to break ground after a February closing and to begin occupancy within roughly six to 12 months of construction start, with full construction projected near 12 months.

The resolution does not itself obligate the city to specific payouts; council members asked staff to return with more detailed cost breakdowns as the application and underwriting proceed.