| (a) HTC properties allocated credit in 1990 and after
are required under §42(h)(6) of the Code to record a LURA restricting
the Development for at least 30 years. Various sections of the Code
specify monitoring rules State Housing Finance Agencies must implement
during the Compliance Period.
(b) After the Compliance Period, the Department will
continue to monitor HTC Developments using the criteria detailed in
paragraphs (1) - (14) of this subsection:
(1) The frequency and depth of monitoring household
income, rents, social services and other requirements of the LURA
will be determined based on risk. Factors will include changes in
ownership or management, compliance history, timeliness of reports
and timeliness of responses to Department requests;
(2) At least once every three years the property will
be physically inspected including the exterior of the Development,
all building systems and 10% of Low-Income Units. No less than five
but no more than 35 of the Development's HTC Low-Income Units will
be physically inspected to determine compliance with HUD's National
Standards for the Physical Inspection of Real Estate;
(3) Each Development shall submit an annual report
in the format prescribed by the Department;
(4) Reports to the Department must be submitted electronically
as required in §10.607 of this subchapter (relating to Reporting
Requirements);
(5) Compliance monitoring fees will continue to be
submitted to the Department annually in the amount stated in the LURA;
(6) All HTC households must be income qualified upon
initial occupancy of any Low Income Unit. Proper verifications of
income are required, and the Department's Income Certification form
must be completed unless the Development participates in the Rural
Rental Housing Program or a project-based HUD program, in which case
the other program's certification form will be accepted;
(7) Rents will remain restricted for all HTC Low-Income
Units. After the Compliance Period, utilities paid to the Owner are
accounted for in the utility allowance. TCAP, Exchange, Bond, and
THTF Developments layered with Housing Tax Credits no longer within
the Compliance Period also include utilities paid to the Owner as
part of the utility allowance. The tenant paid portion of the rent
plus the applicable utility allowance must not exceed the applicable
limit. Any excess rent collected must be refunded;
(8) All additional income and rent restrictions defined
in the LURA remain in effect;
(9) For Additional Use Restrictions, defined in the
LURA (such as supportive services, nonprofit participation, elderly,
etc.), refer to the Development's LURA to determine if compliance
is required after the completion of the Compliance Period or if the
Compliance Period was specifically extended beyond 15 years;
(10) The Owner shall not terminate the lease or evict
low-income residents for other than good cause;
(11) The total number of required HTC Low-Income Units
can be maintained Development wide;
(12) Owners may not charge fees for amenities that
were included in the Development's Eligible Basis;
(13) Once a calendar year, Owners must continue to
collect and maintain current data on each household that includes
the number of household members, age, ethnicity, race, disability
status student status and rental assistance (if any). This information
can be collected on the Department's Annual Eligibility Certification
form or the Income Certification form or HUD Income Certification
form or USDA Income Certification form; and
(14) Employee occupied units will be treated in the
manner prescribed in §10.622(h) of this chapter (relating to
Special Rules Regarding Rents and Rent Limit Violations).
(c) After the first 15 years of the Extended Use Period,
certain requirements will not be monitored as detailed in paragraphs
(1) - (4) of this subsection.
(1) The student restrictions found in §42(i)(3)(D)
of the Code. An income qualified household consisting entirely of
full time students may occupy a Low-Income Unit. If a Development
markets to students or leases more than 15% of the total number of
units to student households, the property will be found in noncompliance
unless the LURA is amended through the Material Amendments procedures
found in §10.405 of this chapter (relating to Amendments);
(2) All households, regardless of income level or 8609
elections, will be allowed to transfer between buildings within the
Development;
(3) The Department will not monitor the Development's
application fee after the Compliance Period is over; and
(4) Mixed income Developments are not required to conduct
annual income recertifications. However, Owners must continue to collect
and report data in accordance with subsection (b)(13) of this section.
(d) While the requirements of the LURA may provide
additional requirements, right and remedies to the Department or the
tenants, the Department will monitor post year 15 in accordance with
this section as amended.
(e) Unless specifically noted in this section, all
requirements of this chapter, the LURA and §42 of the Code remain
in effect for the Extended Use Period. These Post-Year 15 Monitoring
Rules apply only to the HTC Developments administered by the Department.
Participation in other programs administered by the Department may
require additional monitoring to ensure compliance with the requirements
of those programs.
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| Source Note: The provisions of this §10.623 adopted to be effective February 11, 2019, 44 TexReg 560; amended to be effective May 17, 2020, 45 TexReg 3036; amended to be effective November 3, 2022, 47 TexReg 7271; amended to be effective February 26, 2024, 49 TexReg 1065 |
