The Birmingham City Council voted Tuesday to allocate $540,000 of American Rescue Plan funding to subsidize an affordable housing development in the city’s Belview Heights neighborhood.

The development is on the former Camelia Terrace Apartments property on the 1000 and 1100 blocks of 51st Street West. That property, renamed Oak Hill, is being redeveloped by the Housing Reinvestment Corporation of America into 27 single-family houses, 11 of which will be sold at a reduced rate to low-to-moderate-income families. The homes will range from 1,300 to 1,700 square feet.

The $540,000 from the ARP will subsidize the project, which has been victim to rising construction costs due to the COVID-19 pandemic, and allow the developer to reduce the purchase price on the affordable units from “what would typically be over $200,000 to a range of $165,000 to $180,000,” said Cory Stallworth, the city’s deputy director of housing programs.

To be eligible for the affordable housing units, buyers must make 80% of the city’s median income or lower. For a four-member family, that would mean $61,000 per year or less.

The affordable housing units will be indistinguishable from the market-rate housing in the development, Stallworth said at Monday’s meeting of the council’s budget and finance committee: “They will all be the same, and they will be scattered and blended throughout the community. All the affordable houses won’t be on one side. It will be a blended, mixed-income community, as designed.”

Ground for the project was broken in June 2021. Two units are expected to be completed by the end of this week, with four more to follow by mid-February.

Out of the city’s $34.7 million allocation of ARP funds, $1 million was earmarked for affordable home ownership assistance. The remaining $460 million will go to similar projects across Birmingham; Stallworth said the city sees the Oak Hill development as a pilot program.

“We hope to replicate this all across the city,” he said.