The complex financing scheme that allowed officials to break ground Thursday on an affordable-housing project near downtown Santa Fe includes millions of federal economic-stimulus dollars as well as tax credits that could be sold to corporations such as Google and Verizon.

Dignitaries including Gov. Bill Richardson, state House Speaker Ben Luján and Mayor David Coss gathered under a tent on the barren site of a former 1960s-era senior housing complex to praise those who cobbled together the deal, extol the economic and other benefits of the project and to turn ceremonial shovels of dirt.

"This is where the stimulus money is," declared Luján, noting that he sometimes hears questions raised about where the massive sums that Congress and the Obama administration made available under the American Recovery and Reinvestment Act of 2009 are being spent in New Mexico.

"This project will bring diversity to housing in downtown Santa Fe," he said, adding that it also "will bring many good jobs."

A contractor begins construction next week on the first two phases of the Villa Alegre project, which by next summer are expected to provide homes for 60 mostly low-income families and 50 dwellings for income-qualified seniors on a site between West Alameda and West San Francisco Street, just east of St. Francis Drive.

Derek Mannelin, whose Oregon-based Pavilion Construction LLC won the bid to oversee the work, said all but four of the approximately 150 construction jobs will go to New Mexicans. Many of the subcontractors are based in Albuquerque, he said, where Pavilion has an office.

A breakdown of the financing for $23.4 million in development costs prepared by the state Mortgage Finance Authority shows that about $9.5 million came from equity investors through a federal program designed to lure private capital into low-income housing projects. Linda Bridge, director of housing development for the MFA, said the investors receive credits that allow them to offset their federal income-tax liability by becoming silent partners on such projects.

Bridge said she understood that investors could include online-search giant Google and the Verizon telecommunications company. However, Linda Hill, vice president of AEGON USA Realty Advisors in San Francisco, which is listed as "syndicator" for the equity investments, said Thursday that her company had not yet sold the tax credits it acquired.

The U.S. Treasury Department, under the economic-stimulus law's Tax Credit Assistance Program, provided another $4.7 million in what Bridge called a "soft loan," meaning some of that money could be returned if there is sufficient cash flow from the project.

The first phases of Villa Alegre will also use about $4 million of a $5.3 million grant of federal stimulus funds that the Santa Fe Civic Housing Authority received through the U.S. Department of Housing and Urban Development to support green technology and materials.

The competitive grant, the only one of its kind in New Mexico and one of 36 nationwide, was based on plans for use of geothermal heating, solar electricity, a water-efficient irrigation system and "low volatile organic compound paint."

Planners have said these features — which include rooftop photovoltaic panels and 100-feet deep wells that will circulate a glycol solution in a closed loop to help moderate temperatures in the buildings — will help reduce energy use and utility costs in the apartments, where rents will range from $320 to $770 a month.

Los Alamos National Bank provided construction and permanent financing through a mortgage on the family housing section totaling about $1.7 million, while the state Mortgage Finance Authority loaned $890,000 for the senior housing from proceeds of a tax-exempt bond issue.

The MFA also provided $250,000 for the family housing section from a state energy-efficiency fund.

The city of Santa Fe, which issued a long-term lease for the land it owns at Villa Alegre, is credited with providing $664,100 for the first two phases in land costs and reduction of city fees for the development.

The Civic Housing Authority is deferring recovery of $914,211 listed as its "developer fee" for the project, and loaning the project $618,000 of its own funds.

Financing still hasn't been lined up for the third phase of Villa Alegre, which calls for building 34 "workforce housing" units on the vacant site just east of the Salvation Army where Thursday's groundbreaking ceremony was held.

Housing Authority Director Ed Romero has said completion of that section, where rents would be capped to keep them affordable for people earning 80 percent of the area median income, could still be years away.