Search for Budget Savings Leads to Scrutiny of Tax Expenditures

By Michael J. Novogradac, CPA

Given the current economic environment, it should come as little surprise to tax credit professionals that tax expenditures and their role in the federal budget have become the focus of increasing scrutiny in recent months.

 

 

 

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Study Shows Economic Impact of LIHTC Development Along Transit Corridors in Metro Denver

By Josh Burdick, Urban Land Conservancy

Affordable housing built with low-income housing tax credits (LIHTCs) creates millions of dollars in local income, taxes and local jobs for the Denver metro area, according to a recent study by Dr. Elliot Eisenberg, senior economist at the National Association of Home Builders (NAHB). Eisenberg presented the study
results to public policy makers and other housing advocates at an event on June 15 that was hosted by the Urban Land Conservancy (ULC) and the Home Builders Association of Metro Denver (HBA).

 

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Investors Show Increased Interest in Bond Deals

By Jennifer Hill, Staff Writer, Novogradac & Company LLP

Bond-financed developments and the associated 4 percent low-income housing tax credits (LIHTCs) have never been as attractive to investors as their 9 percent counterparts. The risks and losses are traditionally greater and the amount of tax credits is typically lower – a tricky combination to underwrite even in a healthy economy. But as the market slowly began to recover, investors told the Novogradac Journal of Tax Credits in May that they intended to increase LIHTC investments in 2010. Now, more than halfway through the year, banks and attorneys report that 4 percent deals are becoming an increasingly larger piece of the LIHTC pie.

 

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FHA Increases Oversight of Multifamily Lenders and
Underwriters

By Jennifer Dockery, Staff Writer, Novogradac & Company LLP

On July 6 the Federal Housing Administration (FHA) released Mortgage Letter (ML) 2010-21. The letter updates policies and outlines four major changes to FHA’s multifamily rental programs: it revises underwriting standards; enhances verifi cation of property fi nancial performance; expands borrower mortgage credit analysis; and sets up a process for the prescreening of proposals. ML 2010-21 will have the greatest effect on market rate properties, but will also increase the loan costs for affordable housing properties.

 

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Q&A: SREC Underwriting Issues Related to Financing Solar Projects

By Tony Grappone, CPA, Novogradac & Company LLP

Question: Are lenders underwriting permanent loans for solar projects that are dependent upon realizing future Solar Renewable Energy Certifi cate (SREC)
revenues?

Answer: Some are. However, projects that have entered into long-term fi xed-price SREC contracts are generally perceived as much more “bankable” than those attempting to trade their SRECs based on fl uctuating market conditions over time.

 

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As of June 30, states had awarded more than $4.1 billion in American Recovery and Reinvestment Act (Recovery Act) funds to provide affordable housing, a Treasury report revealed.

 

The California Tax Credit Allocation Committee (TCAC) has recently experienced more frequent violations of the one-year rule related to placed-in-service applications, and in some cases has received placed-in-service applications many years after the last building’s placed-in-service date, according to an August memo.

 

The House Financial Services Committee passed two pieces of legislation in July to preserve and revitalize the nation’s affordable housing stock.

 

Illinois Gov. Pat Quinn when he signed H.B. 6038 in August extended through 2016 the Affordable Housing Tax Credit program, which leverages private investment in affordable housing development.

 

The Community Development Financial Institutions (CDFI) Fund is soliciting comments on its CDFI/CDE Project Profile web form, a collection of stories from projects financed by the CDFI Fund’s programs.

 

For the first time, historic tax credit projects are eligible for the Developments of Distinction Awards, sponsored by the Novogradac Journal of Tax Credits.

 

The Department of Energy finalized a $117 million loan guarantee for Kahuku Wind Power LLC, the owner and operator of the Kahuku Wind Power project in Kahuku, Hawaii.