By George Avalos : mercurynews – excerpt (audio track)

City officials prep decision to clear path for conversion

SAN JOSE — A big apartment complex in downtown San Jose could be converted into an affordable homes property, a shift that would terminate its status as market-rate housing.

Modera The Alameda, a 168-unit apartment building on The Alameda near the SAP Center and Diridon train station, is currently slated to be transformed into an affordable housing complex.

The San Jose City Council is scheduled to meet Nov. 14 to consider a conversion proposal for Modera. This decision also includes a financing package to enable the transformation to affordable housing.

A $100 million package of tax-exempt bonds to finance the purchase of Modera The Alameda is the funding centerpiece of the affordable housing conversion, according to documents on file with San Jose officials…

The proposal though, would remove Modera from the property tax rolls — which means the complex would no longer generate property tax revenue once the new owner takes over…(more)

Here is a relatively new program that seems to rely on government funds to convert market rate to “affordable” housing. What does this do to the tax basis? And is this a reasonable approach to generate affordable housing?