The Environmental Site Assessment, Scope and Cost Review, Appraisal
(if applicable), and the Market Analysis must be submitted no later
than the Third Party Report Delivery Date as identified in §11.2(b)
of this chapter (relating to Tax-Exempt Bond and Direct Loan Development
Dates and Deadlines). For Competitive HTC Applications, the Environmental
Site Assessment, Scope and Cost Review, Appraisal (if applicable),
and the Primary Market Area map (with definition based on census tracts,
and site coordinates in decimal degrees, area of PMA in square miles,
and list of census tracts included) must be submitted no later than
the Full Application Delivery Date as identified in §11.2(a)
of this title (relating to Competitive HTC Deadlines Program Calendar)
and the Market Analysis must be submitted no later than the Market
Analysis Delivery Date as identified in §11.2(a) of this chapter.
For Competitive HTC Applications, if the reports, in their entirety,
are not received by the deadline, the Application may be terminated.
An electronic copy of the report in the format of a single file containing
all information and exhibits clearly labeled with the report type,
Development name and Development location are required. All Third
Party reports must be prepared in accordance with Subchapter D of
this chapter (relating to Underwriting and Loan Policy). The Department
may request additional information from the report provider or revisions
to the report as needed. In instances of non-response by the report
provider, the Department may substitute in-house analysis. The Department
is not bound by any opinions expressed in the report.
(1) Environmental Site Assessment. This report, required
for all Developments and prepared in accordance with the requirements
of §11.305 of this chapter (relating to Environmental Site Assessment
Rules and Guidelines), must not be dated more than 12 months prior
to the date of Application submission for non-Competitive Applications,
or the first day of the Application Acceptance Period for Competitive
HTC Applications. If this timeframe is exceeded, then a letter or
updated report must be submitted, dated not more than six months prior
to the date of Application submission or the first day of the Application
Acceptance Period for Competitive HTC Applications from the Person
or organization which prepared the initial assessment confirming that
the site has been re-inspected and reaffirming the conclusions of
the initial report or identifying the changes since the initial report.
(A) Existing Developments funded by USDA will not be
required to supply this information; however, it is the Applicant's
responsibility to ensure that the Development is maintained in compliance
with all state and federal environmental hazard requirements.
(B) If the report includes a recommendation that an
additional assessment be performed, then a statement from the Applicant
must be submitted with the Application indicating that those additional
assessments and recommendations will be performed prior to closing.
If the assessments require further mitigating recommendations, then
evidence indicating that the mitigating recommendations have been
carried out must be submitted at cost certification.
(2) Market Analysis. The Market Analysis, required
for all Developments and prepared in accordance with the requirements
of §11.303 of this chapter (relating to Market Analysis Rules
and Guidelines), must not be dated more than six months prior to the
date of Application submission or the first day of the Application
Acceptance Period for Competitive HTC Applications. If the report
is older than six months, but not more than 12 months prior to the
date of Application submission or the first day of the Application
Acceptance Period for Competitive HTC Applications, the Qualified
Market Analyst that prepared the report may provide a statement that
reaffirms the findings of the original Market Analysis. The statement
may not be dated more than six months prior to the date of Application
submission, or Application Acceptance Date for Direct Loan Applications,
or the first day of the Application Acceptance Period for Competitive
HTC Applications and must be accompanied by the original Market Analysis.
(A) For Acquisition/Rehabilitation or Reconstruction
projects that meet the following criteria, a comprehensive market
study as outlined in IRS Section 42(m)(1)(A)(iii) shall mean a location
map and a written statement by a disinterested Qualified Market Analyst
certifying that the project meets these criteria:
(i) All of the Units in the project contain existing
project based rental assistance that will continue for at least the
Compliance Period, an existing Department LURA, or the subject rents
are at or below 50% AMGI rents;
(ii) The Units are at least 80% occupied at time of
Application; and
(iii) Existing tenants have a leasing preference or
right to return to the Development as stated in a relocation plan.
(B) The report must be prepared by a disinterested
Qualified Market Analyst approved by the Department in accordance
with the approval process outlined in §11.303 of this chapter.
(C) Applications in the USDA Set-Aside proposing Rehabilitation
with residential structures at or above 80% occupancy at the time
of Application submission, the appraisal, required for Rehabilitation
Developments and Identity of Interest transactions prepared in accordance
with §11.304 of this chapter (relating to Appraisal Rules and
Guidelines), will satisfy the requirement for a Market Analysis; however,
the Department may request additional information as needed. (§2306.67055; §42(m)(1)(A)(iii))(D).
It is the responsibility of the Applicant to ensure that this analysis
forms a sufficient basis for the Applicant to be able to use the information
obtained to ensure that the Development will comply with fair housing
laws.
(3) Scope and Cost Review (SCR). This report, required
for Rehabilitation (excluding Reconstruction) and Adaptive Reuse Developments
and prepared in accordance with the requirements of §11.306 of
this chapter (relating to Scope and Cost Review Guidelines), must
not be dated more than six months prior to the date of Application
submission or the first day of the Application Acceptance Period for
Competitive HTC Applications. If the report is older than six months,
but not more than 12 months prior to the date of Application submission
or the first day of the Application Acceptance Period for Competitive
HTC Applications, the report provider may provide a statement that
reaffirms the findings of the original SCR. The statement may not
be dated more than six months prior to the date of Application submission
or the first day of the Application Acceptance Period for Competitive
HTC Applications and must be accompanied by the original SCR. For
Developments which require a capital needs assessment from USDA the
capital needs assessment may be substituted for the SCR and may be
more than six months old, as long as USDA has confirmed in writing
that the existing capital needs assessment is still acceptable and
it meets the requirements of §11.306 of this chapter. All Rehabilitation
Developments financed with Direct Loans must also submit a capital
needs assessment estimating the useful life of each major system.
This assessment must include a comparison between the local building
code and the International Existing Building Code of the International
Code Council. The report must be accompanied by the Department's SCR
Supplement in the form of an excel workbook as published on the Department's
website. For Rehabilitation (excluding Reconstruction) and Adaptive
Reuse Tax-Exempt Bond Developments that do not include a request for
Direct Loan or where the Department is not the bond issuer, a Scope
and Cost Review prepared by a Third Party is not required. The application
must include a Scope of Work Narrative as described in §11.306(j)
of this chapter (relating to Scope and Cost Review Guidelines).
(4) Appraisal. This report prepared in accordance with
the requirements of §11.304 of this chapter (relating to Appraisal
Rules and Guidelines), is required for any Application claiming any
portion of the building acquisition in Eligible Basis, and Identity
of Interest transactions pursuant to Subchapter D of this chapter.
The Appraisal must not be dated more than six months prior to the
date of Application submission, the Application Acceptance Date for
Direct Loan Applications, or the first day of the Application Acceptance
Period for Competitive HTC Applications. For Developments that require
an appraisal from USDA, the appraisal may be more than six months
old, as long as USDA has confirmed in writing that the existing appraisal
is still acceptable. Notwithstanding the foregoing, if the Application
contains a Market Analysis and the appraisal is not required to fulfill
purposes other than establishing the value of land or buildings, an
appraisal is not required if no acquisition costs are entered in the
development cost schedule.
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