2017 LIHTC qualified allocation plan (QAP) and LIHTC application We want you to know!
tax credit team Tasha Weaver Denise Tamulis Kim Martin Meghen Brown Mike Pacheco Paula Harrison Rhonda Housden Shannon Friel 2
QAP and LIHTC application changes For 2017, a few changes to the QAP and some important changes to the LIHTC Application will be discussed during this webinar. 3
9 percent competitive federal credit - amount available (see section 3.A.4) For 2017, a total of $12.5 million in federal housing credit will be available. Letters of Intent Deadline is May 1, 2017 Applications Deadline is June 1, 2017 4
state credit - amount available and maximum credit award (see sections 3.E 3.G) CHFA will allocate the total $5 million in annual state credit that is available for 2017 and will reserve the right to forward-reserve up to the $5 million of 2018 state credit in 2017. New: A maximum of $1 million in annual state credit will be available per project and/or per developer. New: The Disaster Relief program has expired. Letters of Intent are due January 3, 2017 Applications are due February 1, 2017 5
underwriting criteria (see section 4) New : After considering input from the public, no changes will be made to the minimum PUPA amount of $3,900. 6
2017 priorities Priorities The following three priorities will apply to both federal and state credit: Projects serving homeless persons as defined in Section 5.B.5 Projects serving persons with special needs as defined in Section 5.B.5 Projects in counties with populations of less than 175,000 New: CHFA no longer has a priority for projects in counties impacted by a natural disaster. 7
critical elements of the selection process – projects requesting state and federal credit (see section 2) Guiding Principles Criteria for Approval Strong competitive projects will align with the Guiding Principals and meet all Criteria for Approval. New: Language has been added to emphasize CHFA’s requirement that “experience and track record” of the Development and Management Team applies to Competitive 9 percent federal credit, state credit with 4 percent federal credit, and non-competitive 4 percent LIHTC applications. 8
critical elements of the selection process – projects requesting state and federal credit (see section 3) Project Checklists New: All applicable documents required in the Preliminary Application Document Checklist must be submitted prior to the application deadline as a threshold requirement for preliminary applications. New: Applicant’s demonstrated track record of submitting complete application packages on time and responding timely to clarification requests from CHFA staff will favorably impact the applicant’s ability to compete successfully in 9 percent and state credit rounds. 9
critical elements of the selection process – projects requesting state and federal credit (see section 3) Criteria for Approval New : Additional guidance has been added for the zoning requirement. While having zoning in place will not be a threshold requirement, applicants will be at a competitive disadvantage if the appropriate zoning is not in place at the time of the application. 10
critical elements of the selection threshold criteria - preliminary tax credit applications (see section 3.a.5) Thresholds New: Language added to emphasize that all threshold criteria must be met prior to the application submission deadline in order to be considered for an application. None of the threshold requirements will be subject to the five-day clarification letter period. 11
critical elements of the selection threshold criteria - preliminary tax credit applications (see section 3.a.5) Thresholds New: If portions of documentation for threshold #1 (Minimum Score), and #2 (Site Control) were inadvertently omitted or reconciliation with the application is needed for threshold #3 (Market Study) or #7 (Readiness to Proceed), applicants will have until 5:00pm of the next business day following CHFA’s notification to send the documents or the application will be rejected. New: Additional guidance has been added for the zoning requirement. While having zoning in place will not be a threshold requirement, applicants will be at a competitive disadvantage if the appropriate zoning is not in place at the time of the application. 12
critical elements of the selection threshold criteria - preliminary tax credit applications (see section 3.a.5) Thresholds New: Language has been added to the Documents Checklist to emphasize the need for an appraisal by a third party accredited appraiser for acquisition/rehabilitation projects. The appraisal must calculate the value of the property in “ as-is ” condition based on the assumption it is operated with market rents. In addition, the land value must be reported separately. 13
state credit priorities Additional state credit priorities Projects using 4 percent credit and state credit New construction and acq/rehab “Readiness to Proceed” priority for applications for state credit with 4 percent credit submitted by February 1, 2017 New: CHFA will accept state credit applications for acquisition/rehabilitation projects as well as new construction projects. New: Eligibility requirements for projects impacted by a natural disaster will no longer apply since there are no disaster recovery state credits available in 2017. 14
state credit threshold requirements Legal notice w/publisher’s affidavit At the Applicant’s option, it may use DOH’s template (attachment C of the DOH application). The Notice must run at least one day and at least five days before the LIHTC application deadline or submission of the application (deadline to publish: 01.27.17). The developer must hold a public hearing in the community of the proposed project. CHFA must consider the comments from the hearing in the review and approval process for state credits. Can meet CHFA’s requirements if both sources and amounts are specified. List amount of STC requested and anticipated amount of equity. Sign-in sheet Written minutes Audio recording (digital format, i.e. smart phone) Applicants must demonstrate that there will be some monetary, in-kind, or other contribution benefiting the proposed project from the local government that is evidenced by a vote of the public body. 15
9 percent federal credits application fees (see section 6.a.1) The application fee for preliminary application will increase from $5,000 to $10,000 for all 9 percent competitive preliminary applications. 16
non-competitive 4 percent federal credit application fees (see section 6.e.1) The application fee for federal 4 percent credit will be changed from 1 percent of the annual federal (4 percent) credit amount or $5,000, whichever is greater, to a flat fee of $10,000. The $1,000 fee for state credit remains the same and is in addition to the flat fee of $10,000 for the accompanying 4 percent annual federal credit. 17
additional 4 percent federal credits (see section 6.d.4) For requests of additional 4 percent credits prior to the final application that require a new Initial Determination Letter, the fee for the request will be increased from $1,500 to $3,000. 18
non-competitive 4 percent federal credit initial determination fee The Initial Determination Fee has been increased from 2.5 percent to 3.5 percent of the annual credit amount requested. 19
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