"We are extremely disappointed," said Mark Deitcher, Mission First's director of business development. "We feel this project is incredibly important to the veterans it would serve."
Deitcher said Mission First is still committed to and seeking funding for the project, which would refurbish and incorporate the inn on Schuylkill Road. In the coming weeks, the developer will seek a meeting with the Pennsylvania Housing Finance Agency to find out why it didn't fund the project.
The agency awarded more than $20 million in tax credits to 24 of the 74 suburban projects that requested funding. Chester, Delaware, and Montgomery Counties each had one project that got the tax credits this year. The agency tries to scatter winners throughout the state.
The agency also considers developers' financial plans, communities' affordable-housing needs, access to public transportation, and community support when awarding the credits.
Most projects aren't funded the first or second time the state agency reviews their applications, said Scott Elliott, the agency's spokesman.
"It's not unusual for it to go into a third year," he said. "And, of course, there isn't any guarantee about the third year."
The chances of acceptance increase with each subsequent year as applicants refine their applications, he said.
Another of Mission First's projects, in Bradford County in northeastern Pennsylvania, will receive more than $900,000 in tax credits.