IOWA CITY, Iowa (AP) — A federal agency is reviewing whether it would be appropriate for Iowa City to use $1 million in affordable housing funds to buy five condominiums at a luxury high-rise development.
The Department of Housing and Urban Development confirmed the review in a letter to Sen. Chuck Grassley, who raised questions about the arrangement on behalf of a constituent.
Iowa City officials have proposed the purchase of five studio and one-bedroom condos at The Chauncey, a planned $49 million, 15-story mixed-use development. The Iowa City Public Housing Authority would lease them to low-income individuals, likely targeting the disabled and elderly.
Attorney Rockne Cole questions whether the arrangement complies with federal law, and is the best use of $1 million.
City officials say they're confident the spending would be legal and appropriate.