| (a) Credit Amount (Competitive HTC Only). (§2306.6711(b))
The Board may not award or allocate to an Applicant, Developer, Affiliate,
or Guarantor (unless the Guarantor is also the General Contractor
or provides the guaranty only during the construction period, and
is not a Principal of the Applicant, Developer or Affiliate of the
Development Owner) Housing Tax Credits in an aggregate amount greater
than $6 million in a single Application Round. Prior to posting the
agenda for the last Board meeting in June, an Applicant that has Applications
pending for more than $6 million in credit may notify staff in writing
or by email of the Application(s) they will not pursue in order to
bring their request within the $6 million cap. Any other Applications
they do not wish to pursue will remain on the waiting list if not
otherwise terminated. If the Applicant has not made this self-selection
by this date, staff will first select the Application(s) that will
enable the Department to comply with the state and federal non-profit
set-asides, and will then select the highest scoring Application,
including consideration of tie-breakers if there are tied scores.
The Application(s) that does not meet Department criteria will not
be reviewed unless the Applicant withdraws an Application that is
eligible for an award and has been reviewed. All entities that are
under common Control are Affiliates. For purposes of determining the
$6 million limitation, a Person is not deemed to be an Applicant,
Developer, Affiliate, or Guarantor solely because it:
(1) Raises or provides equity;
(2) Provides "qualified commercial financing";
(3) Is a Qualified Nonprofit Organization or other
not-for-profit entity that is providing solely loan funds, grant funds
or social services; or
(4) Receives fees as a consultant or advisor that do
not exceed $200,000.
(b) Maximum Request Limit (Competitive HTC Only). For
any given Development, an Applicant may not request more than 150%
of the credit amount available in the subregion based on estimates
released by the Department on December 1, or $2,000,000 whichever
is less. In addition, for Elderly Developments in a Uniform State
Service Region containing a county with a population that exceeds
one million, the request may not exceed the final amount published
on the Department's website after the annual release of the Internal
Revenue Service notice regarding the credit ceiling (2306.6711(h)).
For all Applications, the Department will consider the amount in the
funding request of the pre-application and Application to be the amount
of Housing Tax Credits requested and will reduce the Applicant's request
to the maximum allowable under this subsection through the underwriting
process. While the Housing Tax Credit request amount for an Application
may be reduced through the underwriting process or at the written
request of staff, the Department shall otherwise consider the request
amount final. The Tax Credit request amount cannot be changed through
the Administrative Deficiency process. Regardless of the credit amount
requested or any subsequent changes to the request made by staff,
the Board may not award to any individual Development more than $2
million in a single Application Round. (§2306.6711(b)).
(c) Increase in Eligible Basis (30% Boost). Applications
will be evaluated for an increase of up to 30% in Eligible Basis provided
they meet any one of the criteria identified in paragraphs (1) - (4)
of this subsection. Staff will recommend no increase or a partial
increase in Eligible Basis if it is determined it would cause the
Development to be over sourced, as determined by the Department, in
which case a credit amount necessary to fill the gap in financing
will be recommended. In no instance will the boost exceed more than
the amount of credits required to create the HTC rent-restricted Units.
The criteria in paragraph (3) of this subsection are not applicable
to Tax-Exempt Bond Developments.
(1) The Development is located in a Qualified Census
Tract (QCT) (as determined by the Secretary of HUD) that has less
than 20% Housing Tax Credit Units per total households in the tract
as reflected in the Department's current Site Demographic Characteristics
Report. New Construction or Adaptive Reuse Developments located in
a QCT that has in excess of 20% Housing Tax Credit Units per total
households are not eligible for a 30% increase in Eligible Basis,
which would otherwise be available for the Development Site pursuant
to §42(d)(5) of the Code, unless the Application includes a resolution
acknowledging the Development is located in a census tract that has
more than 20% Housing Tax Credits Units per total households and stating
that the Governing Body of the appropriate municipality or county
containing the Development has no objection to the Application. Rehabilitation
Developments where this rule is triggered are eligible for the boost
and are not required to obtain such a resolution from the Governing
Body. An acceptable, but not required, form of resolution may be obtained
in the Multifamily Uniform Application Templates. Required documentation
must be submitted by the Full Application Delivery Date as identified
in §11.2(a) of this chapter (relating to Competitive HTC Deadlines),
or Resolutions Delivery Date in §11.2(b) of this chapter (relating
to Tax-Exempt Bond and Direct Loan Application Dates and Deadlines),
as applicable. The Application must include a census map that includes
the 11-digit census tract number and clearly shows that the proposed
Development is located within a QCT.
(2) The Development is located in a Small Area Difficult
Development Area (SADDA)) (based on Small Area Fair Market Rents as
determined by the Secretary of HUD) or for Rural areas located in
a Difficult Development Area (DDA) that has high construction, land
and utility costs relative to the AMGI. The Application must include
the SADDA or DDA map that clearly shows the proposed Development is
located within the boundaries of a SADDA or DDA as applicable.
(3) For Competitive HTC only, Development meets one
of the criteria described in subparagraphs (A) - (F) of this paragraph
pursuant to Code, §42(d)(5)(B)(v):
(A) The Development is located in a Rural Area;
(B) The Development is entirely Supportive Housing
and is in accordance with §11.1(d) of this chapter (relating
to the definition of Supportive Housing);
(C) The Development meets the criteria for the Opportunity
Index as defined in §11.9(c)(5) of this chapter (relating to
Competitive HTC Selection Criteria);
(D) The Applicant elects to restrict 10% of the proposed
low income Units for households at or below 30% of AMGI. These Units
may not be used to meet any scoring criteria, or used to meet any
Multifamily Direct Loan program requirement;
(E) The Development is in an area covered by a concerted
revitalization plan, is not an Elderly Development, and is not located
in a QCT. A Development will be considered to be in an area covered
by a concerted revitalization plan if it is eligible for and elects
points under §11.9(d)(7) of this chapter; or
(F) The Development is located in a Qualified Opportunity
Zone designated under the Bipartisan Budget Act of 2018 (H.R. 1892).
Pursuant to Internal Revenue Service Announcement 2021-10, the boundaries
of the Opportunity Zone are unaffected by 2020 Decennial Census changes.
(4) For Tax-Exempt Bond Developments, as a general
rule, a QCT, non-metro DDA or SADDA designation would have to coincide
with the program year the Certificate of Reservation is issued in
order for the Department to apply the 30% boost in its underwriting
evaluation. The Department acknowledges guidance contained in the
Federal Register regarding effective dates of QCT, non-metro DDA and
SADDA designations. Pursuant to the Federal Register Notice, unless
federal guidance states otherwise, complete Applications (including
all Third Party Reports) with a corresponding Certificate of Reservation
that are submitted to the Department in the year the QCT, non-metro
DDA or SADDA designation is not effective may be underwritten to include
the 30% boost, provided a complete application was submitted to the
bond issuer in the year the QCT, non-metro DDA or SADDA designation
was effective. Where this is the case, the Application must contain
a certification from the issuer that speaks to the date on which such
complete application (as defined in the Notice) was submitted. If
the issuer is a member of the organizational structure then such certification
must come from the bond counsel to the issuer.
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