The Virginia Housing Development Authority approved housing project in Fairfax County yesterday by granting a $4.5 million construction loan for the development.

Construction of Rolling Road Estates, a development of 100 two, three and four-bedroom subsidized town-houses planned for a 35-acre site on Rolling Road in Springfield, is expected to begin in March or April, according to the project developer, David Small, of Pittsburgh.

Fairfax County Board of Supervisors Chairman John F. Herrity, Board member Marie B. Travesky (R-Springfield) and residents near the Rolling Road Site have been fighting the project since learning in October it was near final approval.

They had succeeded in getting the authority to delay approval of the housing project until yesterday.

"HUD has won this round, but the battle against Rolling Road isn't over yet by a long shot," Herrity said. He was referring to the Department of Housing and Urban Development's threat to cut off $3.7 million in annual federal community development funds to the county if the Board of Supervisors bocked construction of the project. The Board had taken a position against the project in November but withdrew opposition after HUD's threat.

Herrity and two Springfield residents fighting the Rolling Road project have joined in a lawsuit against the county planning commission in an effort to stop the project. They charged that the planning commission violated state law by not reviewing Rolling Road Estates.

Traversky said she was disappointed by the state authority's action. She said she hoped the authority would de ay financing the project pending the outcome of a proposal to reduce the number of subzidized units in the project from 100 to 50.

Small' company, Houlsing Affiliates Inc, of Pittsburgh, has agreed "as a good faith effort" to try to find some non subsidized families to live alongside subsidized families in the project. But he said he is doubtful the effort will be successful.

I don't think people earning $40,000 or $50,000 a year will live next people who are paying as low as $200 a month in rent. It's an American economic fact of life," Small said.

Thirty per cent of Rolling Road Estates residents wil be low-income families and 70 per cent wil be moderate-income families. A family of four earning less than $10,100 a year is considered low income, while a mily of four earning between $10,100 and $16,200 is considered to have a moderate income.