Low-Income Housing Tax Credits:
News Archive
2009
December
SENATORS PLEDGE WORK ON TAX EXTENDERS IN EARLY 2010
WASHINGTON, D.C. - December 23, 2009
Sens. Max Baucus, D-Mont., and Chuck Grassley, R-Iowa, sent a letter to Senate Majority Leader Harry Reid, D-Nev., and Minority Leader Mitch McConnell, R-Ky., yesterday regarding adjournment of the first session of the 111th Congress without extending expiring tax assistance provisions. In addition to the letter, the Finance Committee leaders issued a joint statement declaring their intent to address expiring tax provisions early next year.
The House passed H.R. 4213, the Tax Extenders Act of 2009, on December 9. The House bill would provide individuals and businesses with approximately $31 billion in tax relief in 2009 by extending for one year, through 2010, more than 40 provisions that are scheduled to expire at the end of 2009. The bill would extend for one year, through 2010, the tax credit exchange program, created by the American Recovery and Reinvestment Act of 2009, which allows state housing agencies to elect to receive a payment in lieu of a portion of the state’s allocation of low-income housing tax credits (LIHTCs).
Click here for more information about tax extenders legislation. To discuss this and other current developments in the LIHTC industry, join Novogradac & Company LLP on January 14 and 15 for the 16th Annual Tax Credit Developers Conference in Miami, Fla.TREASURY SURPASSES $4 BILLION IN SECTION 1602 GRANTS
WASHINGTON, D.C. - December 22, 2009
The Treasury Department today announced that the American Recovery and Reinvestment Act (Recovery Act) has now provided more than $4 billion in funding to spur the development of affordable housing through the Section 1602 program, which provides cash grants in lieu of low-income housing tax credits (LIHTCs). To date, 50 state and territorial housing authorities have received payments in lieu of tax credits, including awards in this round made to Arizona, Delaware, Georgia, Hawaii, Indiana, Michigan, Minnesota, New Mexico, Ohio, Pennsylvania, and Utah, with Texas being a first time recipient. Click here for more information, including a complete list of funds awarded to states under the program to date.
EXTENDERS PACKAGE WOULD EXTEND LIHTC EXCHANGE PROGRAM FOR ONE YEAR
WASHINGTON, D.C. - December 8, 2009
Ways and Means Committee Chairman Charles B. Rangel, D-N.Y., yesterday introduced H.R. 4213, the Tax Extenders Act of 2009. The Tax Extenders Act of 2009 would provide individuals and businesses with approximately $31 billion in tax relief in 2009 by extending, for one year through 2010, more than 40 provisions that are scheduled to expire at the end of 2009. The bill would extend for one year, through 2010, the tax credit exchange program, created by the American Recovery and Reinvestment Act of 2009, that allows state housing agencies to elect to receive a payment in lieu of a portion of the state’s allocation of low-income housing tax credits (LIHTCs).
SCHUMER BILL ALLOWS MORE MILITARY PERSONNEL TO QUALIFY FOR LIHTC
WASHINGTON, D.C. - December 4, 2009
Sen. Charles E. Schumer, D-N.Y., yesterday introduced the Military Families Affordable Homes Act of 2009. Currently, when military personnel apply for low-income housing tax credit (LIHTC) housing, their basic allowance for housing (BAH) is added to their total annual pay for the purposes of calculating income. A 2008 policy passed by Congress in the Housing and Economic Recovery Act (HERA) allows the exception for personnel stationed at nine select installations; Schumer's bill would extend the policy to personnel stationed at any U.S. military installation. Click here to read Schumer’s statement announcing the bill.
A copy of S. 2827 will be posted online at www.taxcredithousing.com as soon as the text becomes available. Tune in to the Tax Credit Tuesday Podcast on December 8 to learn more about this proposal and other LIHTC changes under consideration in Congress.
November
TCAC PROPOSES CHANGES TO QAP FOR 2010
SACRAMENTO, Calif. - November 24, 2009
The California Tax Credit Allocation Committee (TCAC) today announced proposed amendments to its low-income housing tax credit (LIHTC) qualified allocation plan (QAP). TCAC will hold public hearings on the proposed changes on December 4, December 7 and December 9, 2009. Click here to read a memo about the proposed changes. Click here to download the proposed regulation changes for 2010.
TREASURY, IRS RELEASE 2009-2010 PRIORITY GUIDANCE PLAN
WASHINGTON, D.C. - November 24, 2009
The Treasury Department and Internal Revenue Service (IRS) today released the 2009-2010 Priority Guidance Plan, which contains 315 projects that are scheduled for completion from July 2009 through June 2010.
According to the plan, the IRS plans to publish:
- final regulations under Internal Revenue Code §42 on the requirements for a qualified contract (proposed regulations on this issue were published June 19, 2007);
- regulations concerning utility allowances under §42(g)(2)(B)(ii) for sub-metered buildings (interim guidance on this topic was issued in Notice 2009-44);
- guidance for the low-income housing tax credit (LIHTC) relating to sections 1404 and 1602 of the American Recovery Reinvestment Tax Act of 2009; and
- guidance on tax-exempt bonds issued in Midwestern and Hurricane Ike disaster areas.
When this guidance is released by the IRS, it will be posted at www.taxcredithousing.com.
To discuss the latest guidance on the LIHTC and tax-exempt housing bonds, join Novogradac & Company LLP for the Tax Credit Housing Finance Conference in Las Vegas, Nev. on December 3-4, 2009. If you can’t make the conference next week, there’s still time to register for the 16th Annual Tax Credit Developers Conference on January 14 and 15 in Miami, Fla.
LIHTC CARRYBACK PROPOSAL INTRODUCED IN HOUSE
WASHINGTON, D.C. - November 18, 2009
Rep. Bill Pascrell, D-N.J., a member of the House Ways and Means Committee, today introduced a bill that includes a two-part proposal that would increase the existing carryback for the low-income housing tax credit (LIHTC). The two-part carryback provision is one of three consensus proposals developed by the Affordable Rental Housing A.C.T.I.O.N. (A Call To Invest in Our Neighborhoods) Campaign. A copy of Rep. Pascrell’s bill will be posted online at www.taxcredithousing.com as soon as the text becomes available.
TREASURY ANNOUNCES HOUSING FINANCE AGENCY INITIATIVE
WASHINGTON, D.C. - November 18, 2009
The Treasury Department yesterday announced a new initiative for state and local housing finance agencies (HFAs) that, using authority provided by the Housing and Economic Recovery Act of 2008 (HERA), will provide hundreds of thousands of affordable mortgages for working families and enable the development and rehabilitation of tens of thousands of affordable rental properties. The Treasury Department the U.S. Department of Housing and Urban Development (HUD) developed the initiative with the Federal Housing Finance Agency (FHFA), Fannie Mae and Freddie Mac. The initiative has two parts: the New Issue Bond Program (NIBP), which will provide temporary financing for HFAs to issue new mortgage revenue bonds; and the Temporary Credit and Liquidity Program (TCLP), under which Fannie Mae and Freddie Mac will provide replacement credit and liquidity facilities available to HFAs that will help reduce the costs of maintaining existing financing.
This initiative will be discussed during a new panel at Novogradac & Company’s 16th Annual Tax Credit Developers Conference on January 14 and 15 in Miami, Fla.
IRS ANNOUNCES INFLATION ADJUST LIHTC, BOND CAPS FOR 2010
WASHINGTON, D.C. - November 10, 2009
The Internal Revenue Service (IRS) last month announced in Revenue Procedure 2009-50 the inflation-adjusted low-income housing tax credit (LIHTC) and private activity bond caps for 2010. For calendar year 2010, the amount used under §42(h)(3)(C)(ii) to calculate the state LIHTC is the greater of $2.10 multiplied by the state population or $2,430,000. The amount used under §146(d)(1) to calculate the state ceiling for the volume cap for private activity bonds in 2010 is the greater of $90 multiplied by the state population or $273,775,000. Click here to view Rev. Proc. 2009-50.
October
HUD INVITES COMMENTS ON TCAP REPORTING REQUIREMENTS
WASHINGTON, D.C. - October 27, 2009
The U.S. Department of Housing and Urban Development (HUD) today invited public comment on the reporting and recordkeeping requirements of the Tax Credit Assistance Program (TCAP). The data required includes program level, project level and beneficiary level information collected and reported on by TCAP grantees. The data identifies who benefits from the TCAP program and how statutory requirements are satisfied. Comments will be accepted through November 27, 2009. Click here for more information.
To discuss this and other recent developments in the field of affordable housing finance, join Novogradac & Company LLP for the Tax Credit Housing Finance Conference in Las Vegas, Nev. on December 3-4, 2009.
ENTERPRISE COMMITS $4 BILLION TO GREEN COMMUNITIES INITIATIVE
WASHINGTON, D.C. - October 22, 2009
Enterprise yesterday announced a $4 billion commitment to its Green Communities initiative. The commitment will create, preserve or retrofit 75,000 green homes and community and commercial buildings within the next five years. Enterprise has also received grants from three organizations: The Home Depot Foundation ($1.5 million); The Kresge Foundation ($1 million); and The Kendeda Fund ($1 million). Bank of America, Citi, JPMorgan Chase, Living Cities, Surdna Foundation and The Oak Hill Fund will provide additional support. Enterprise also released Incremental Cost, Measurable Savings: Enterprise Green Communities Criteria, a study showing the cost effectiveness of meeting Enterprise Green Communities Criteria, a comprehensive green building framework for affordable housing.
Industry professionals will discuss green building and other topics affecting affordable housing at Novogradac’s Tax Credit Housing Finance Conference in Las Vegas, Nev. on December 3-4, 2009.THE OBAMA ADMINISTRATION ANNOUNCES NEW HOUSING INITIATIVE
WASHINGTON, D.C. - October 19, 2009
The Obama administration today announced the Homeowner Affordability and Stability Plan, an initiative for state and local housing finance agencies (HFAs) that will support low mortgage rates and expand resources for low- and middle-income borrowers to purchase or rent homes that are affordable over the long term. Using authority provided by the Housing and Economic Recovery Act of 2008 (HERA), the initiative will enable the development and rehabilitation of tens of thousands of affordable rental properties and provide hundreds of thousands of affordable mortgages for working families. The initiative has two parts: the New Issue Bond Program (NIBP), a bond purchase program that will provide temporary financing for HFAs to issue new mortgage revenue bonds, and the Temporary Credit and Liquidity Program (TCLP), a program to improve HFAs’ access to liquidity for their outstanding bonds. A summary of the programs can be found here.
The Homeowner Affordability and Stability Plan and other topics affecting state housing finance agencies will be discussed at Novogradac’s Tax Credit Housing Finance Conference in Las Vegas, Nev. on December 3-4, 2009.
E&Y RELEASES LIHTC INVESTMENT STUDY
WASHINGTON, D.C. - October 12, 2009
A study by Ernst & Young (E&Y) and commissioned by Enterprise Community Partners, Inc. and Local Initiatives Support Corporation (LISC) has confirmed that LIHTC investment activity has fallen dramatically in the last two years but would increase significantly in the near term if Congress enacted legislation allowing a five-year carryback of LIHTCs instead of the current one-year carryback. This would amount to $5 billion more of investment nationally through 2011. The study was undertaken to gain a better understanding of the LIHTC investment market and to analyze investor response to certain legislative proposals, including the five-year carryback. The Affordable Housing Tax Credit Coalition, Enterprise Community Partners Inc., LISC, the Affordable Housing Investors Council and E&Y worked for several months to produce the report.
Michael Novogradac and Buzz Roberts provide a more in-depth discussion of the study and the carryback proposal in October’s Novogradac Journal of Tax Credit Housing.
The carryback proposal and other pending legislation will also be the topics discussed at Novogradac’s Tax Credit Housing Finance Conference in Las Vegas, Nev. on December 3-4, 2009.HUD PROPOSES RULE PROHIBITING ESCROWING OF TAX CREDIT EQUITY
WASHINGTON, D.C. - October 9, 2009
The U.S. Department of Housing and Urban Development (HUD) today released for public comment a proposed rule that would prohibit the escrowing of tax credit equity. The proposed rule would affect low-income housing tax credits, historic tax credits and new markets tax credits, among others, and would conform HUD’s Federal Housing Administration multifamily mortgage insurance regulations to a provision in Title VIII of the Housing and Economic Recovery Act of 2008. The full text of the Federal Register notice can be found here. HUD will accept comments on the proposed rule until December 8, 2009. Please tune in to the October 20 Tax Credit Tuesday podcast for expanded coverage of the proposed rule.
HUD DESIGNATES QCTS, DDAS FOR 2010
WASHINGTON, D.C. - October 6, 2009
The U.S. Department of Housing and Urban Development (HUD) today designated difficult development areas (DDAs) and qualified census tracts (QCTs) for purposes of the low-income housing tax credit (LIHTC) under Section 42 of the Internal Revenue Code (IRC). HUD makes new DDA designations annually. LIHTC projects in DDAs or QCTs are eligible for as much as 30 percent more LIHTC subsidy than projects not located in DDAs or QCTs. In accordance with the Gulf Opportunity Zone (GO Zone) Act of 2005, the authorization for GO Zone DDAs expires on December 31, 2010 and consequently, today’s notice represents the last designation of GO Zone DDAs.
HUD also made new QCT designations on the basis of revised metropolitan statistical area (MSA) definitions published by the Office of Management and Budget (OMB). QCTs are designated periodically as new data become available; this is the first designation of new QCTs since September 28, 2006.LEGISLATION INTRODUCED TO EXPAND HISTORIC TAX CREDIT
WASHINGTON, D.C. - October 2, 2009
Rep. Allyson Schwartz, D-Pa., yesterday introduced H.R. 3715, the Community Restoration and Revitalization Act of 2009. The bill would amend the Internal Revenue Code of 1986 to expand the historic tax credit (HTC). If passed, the legislation would extend HTCs to smaller projects. Click here to read Congresswoman Schwartz’s announcement about the bill. Sen. Blanche Lincoln, D-Ark., introduced a companion bill yesterday in the Senate, S. 1743. Both bills have been referred to committee. Copies of both bills will be posted online at www.taxcredithousing.com as soon as they become available.
September
HUD PUBLISHES FINAL 2010 FAIR MARKET RENTS
WASHINGTON, D.C. - September 30, 2009
The U.S. Department of Housing and Urban Development today published final fiscal year 2010 fair market rents (FMRs). FMRs are used to determine payment standard amounts for the Housing Choice Voucher program, to determine initial renewal rents for some expiring project-based Section 8 contracts and to determine initial rents for housing assistance payments (HAP) contracts in the Moderate Rehabilitation Single Room Occupancy (SRO) program. The FMRs published today are effective on October 1, 2009.
Analysis of the final 2010 FMRs will be presented at Novogradac & Company’s LIHTC Property Compliance Workshop, October 1-2 in San Francisco. It’s not too late to attend!
IRS RELEASES UPDATED 8823 GUIDE
WASHINGTON, D.C. - Septemberr 25, 2009
The Internal Revenue Service (IRS) today released an updated version of its Guide for Completing Form 8823: Low-Income Housing Credit Agencies Report of Noncompliance or Building Disposition. The document presents standardized operational definitions for the noncompliance categories listed on Form 8823 and is intended to provide consistent interpretation and application of Internal Revenue Code (IRC) Section 42 requirements among states and consistent reporting of noncompliance.
Analysis of the new 8823 guide will be featured at Novogradac & Company’s LIHTC Property Compliance Workshop, October 1-2 in San Francisco. It’s not too late to attend!
HUD PROVIDES GUIDANCE ON JOB CREATION REPORTING FOR TCAP
WASHINGTON, D.C. - September 24, 2009
The U.S. Department of Housing and Urban Development (HUD) this week posted guidance for Tax Credit Assistance Program (TCAP) grantees for “Reporting on Recovery Act Jobs Created or Retained.” Each program under the American Recovery and Reinvestment Act of 2009 is responsible for providing HUD-approved job reporting guidance to its grantees; TCAP grantees are required to generate estimates of job impact by directly collecting specific data from sub-recipients and vendors. Click here for more information about TCAP.
Join Novogradac & Company LLP October 1-2 in San Francisco for the 16th Annual Affordable Housing Conference to learn more about this guidance and the Recovery Act.GEORGIA DCA ASKS HOUSING PROPERTIES TO REPORT FLOOD DAMAGE
ATLANTA, Ga. - September 23, 2009
In response to recent flooding in the Atlanta region, the Georgia Department of Community Affairs (DCA) today asked owners and managers of affordable housing to report if their properties have been damaged or otherwise affected. This information should be submitted by e-mail to compliance@dca.ga.gov; if e-mail is unavailable, respondents should call 404-679-0678. DCA also asks that casualty loss notices be completed as soon as possible. Click here to download a copy of the form.
NYE INTRODUCES LIHTC-MILITARY FAMILY HOUSING BILL
VIRGINIA BEACH, Va. - September 22, 2009
Rep. Glenn Nye, D-Va., yesterday announced the Military Families Affordable Homes Act of 2009. If passed, the bill would allow enlisted personnel stationed at U.S. military installations to exclude from their annual income their basic allowance for housing (BAH). Military personnel must include their BAH in their total pay when applying for housing funded through the Low-Income Housing Tax Credit (LIHTC) program. In most cases, the additional income puts military families above the LIHTC income limits. A 2008 policy passed by Congress in the Housing and Economic Recovery Act (HERA) allows the exception for personnel stationed at nine select installations; Nye's bill would extend the policy to personnel stationed at any U.S. military installation. Click here to read Congressman Nye's announcement about the bill. A copy of the legislation will be posted online at www.taxcredithousing.com as soon as it becomes available.
TREASURY UPDATES FAQS FOR LIHTC EXCHANGE PROGRAM
WASHINGTON, D.C. - September 21, 2009
The Treasury Department last week released an updated version of its Frequently Asked Questions and Answers document for the Section 1602 low-income housing tax credit (LIHTC) exchange program. The FAQs document was revised to amend language about eligible use of funds and to add new questions regarding recapture, liens and other issues.
Join Novogradac & Company LLP October 1-2 in San Francisco for the 16th Annual Affordable Housing Conference to learn more about this guidance and the exchange program.
ARRA RECIPIENTS IN KY. REQUIRED TO ATTEND WORKSHOP
WASHINGTON, D.C. - September 21, 2009
The Kentucky Housing Corporation (KHC) Housing Finance and Construction Department will hold a free mandatory training session for developers of Tax Credit Assistance Program (TCAP) and Section 1602 low-income housing tax credit (LIHTC) exchange program properties on October 13. The session will cover the reporting requirements mandated by the American Recovery and Reinvestment Act for recipients of TCAP and exchange program funds. Click here for more information about the workshop. For even more information on TCAP and the exchange program, please join us in San Francisco for the 16th Annual Affordable Housing Conference.
CALIF. ADDS TWO ADDITIONAL ARRA WORKSHOPS
WASHINGTON, D.C. - September 21, 2009
The California Tax Credit Allocation Committee (TCAC) announced Friday that it added two additional American Recovery and Reinvestment Act loan workshops for developers with a preliminary reservation of Tax Credit Assistance Program (TCAP) and Section 1602 low-income housing tax credit (LIHTC) exchange program funds. Developers with reservations of funds are required to attend one of the four loan workshops. The dates of the new workshops are September 29 in Sacramento and October 1 in Los Angeles. The previously announced workshops are September 21 in Sacramento and September 24 in Los Angeles. The TCAC workshops will offer an overview of the loan process and provide a greater understanding of the disbursement procedures, reporting requirements and federal requirements, including environmental review, Davis-Bacon prevailing wages and Section 504 compliance. Click here for more information about the workshops.
For even more information on the exchange program and TCAP, please join us in San Francisco for the 16th Annual Affordable Housing Conference. California State Treasurer Bill Lockyer will provide the Keynote address at Thursday’s luncheon and Bill Pavao, executive director of TCAC, will serve on a panel of state housing agency representatives who will address the state agencies’ new role. For more details on the 16th Annual Affordable Housing Conference held October 1-2 at the InterContinental Hotel, click here.
HUD RELEASES NEW TCAP GUIDANCE
WASHINGTON, D.C. - September 18, 2009
The U.S. Department of Housing and Urban Development (HUD) today released new guidance for the Tax Credit Assistance Program (TCAP). The guidance was published in a Fees and Asset Management Guide and a Projects with Existing Environmental Review Guide.
Join Novogradac & Company LLP October 1-2 in San Francisco for the 16th Annual Affordable Housing Conference to learn more about TCAP and this guidance.
OPPORTUNITY TO COMMENT ON GSES DUTIES TO SERVE UNDERSERVED MARKETS ENDS SEPT. 18
WASHINGTON, D.C. - September 16, 2009
The comment window closes Friday for the public to submit input to Federal Housing Finance Agency (FHFA) about government sponsored enterprises (GSEs) Fannie Mae’s and Freddie Mac’s duties to serve underserved markets. The Housing and Economic Recovery Act of 2008 (HERA) established a duty for the GSEs to serve three underserved markets—manufactured housing, affordable housing preservation and rural areas—in order to increase the liquidity of mortgage investments and improve the distribution of investment capital available for mortgage financing in those markets. The FHFA is required to establish a manner for evaluating the GSEs compliance with the new law. To assist in its rulemaking for this purpose, the FHFA invited public comment on the characteristics and types of GSE transactions and activities that should be considered, and how such transactions and activities should be evaluated and rated. Comments will be accepted through September 18.
The GSEs and their participation in the housing markets will be among the many hot topics covered at the 16th Annual Affordable Housing Conference on October 1-2 in San Francisco. Click here to review the agenda.
Michael J. Novogradac, CPA, will also discuss this proposal in the next Tax Credit Tuesday Podcast; tune in on September 22 to learn more.
ARRA FUND RECIPIENTS IN CALIF. REQUIRED TO ATTEND WORKSHOP
SACRAMENTO, Calif. - September 15, 2009
The California Tax Credit Allocation Committee (TCAC) announced Friday that it will conduct mandatory loan workshops for recipients of Recovery Act funds. TCAC’s first workshop will be held in Sacramento on Monday, September 21; the second workshop will be presented in Los Angeles on Thursday, September 24. All applicants that have received a preliminary reservation of funds under the Section 1602 low-income housing tax credit (LIHTC) exchange program or the Tax Credit Assistance Program (TCAP) are required to attend one of the workshops. The TCAC workshops are meant to offer an overview of the loan process and provide a greater understanding of the disbursement procedures, reporting requirements and federal requirements, including environmental review, Davis-Bacon prevailing wages and Section 504 compliance. Click here for more information about the workshops.
For even more information on the exchange program and TCAP, please join us in San Francisco for the 16th Annual Affordable Housing Conference. California State Treasurer Bill Lockyer will provide the Keynote address at Thursday’s luncheon and Bill Pavao, executive director of TCAC, will serve on a panel of state housing agency representatives who will, in light of the recent legislation, address the state agencies’ new role. For more details on the 16th Annual Affordable Housing Conference held October 1-2 at the InterContinental Hotel, click here.
HUD INVITES COMMENTS ON ENDING ‘HOLD HARMLESS’ POLICY
WASHINGTON, D.C. - September 11, 2009
In a request for comments scheduled for publication in the Federal Register on September 14, the U.S. Department of Housing and Urban Development (HUD) invites comments from the public on whether it should discontinue its policy of maintaining Section 8 income limits for certain areas at previously published levels when reductions would otherwise have resulted. The policy was implemented to avoid jeopardizing the financial feasibility of existing housing projects in instances where program rents were tied to Section 8 income limits.
The Housing and Economic Recovery Act of 2008 (HERA) implemented a project-level hold-harmless provision for multifamily projects financed with low-income housing tax credits (LIHTCs) and tax-exempt private activity bonds, also referred to as Multifamily Tax Subsidy Projects (MTSPs). In the September 14 notice, HUD says this provision precludes the need for it to continue the policy for the benefit of MTSPs; should HUD discontinue the hold harmless policy, MTSPs are protected by the new statute from decreases in income limits and rents. However, other federal programs and the determinations of difficult development areas (DDAs) for the LIHTC program would be affected if the policy is discontinued.
The details of this proposal will be discussed in the next Tax Credit Tuesday Podcast; tune in on September 15 to learn more.IRS ANNOUNCES LIHTC ALLOCATIONS TO NATIONAL POOL
WASHINGTON, D.C. - September 2, 2009
The Internal Revenue Service (IRS) today published the amounts of unused low-income housing tax credit (LIHTC) carryovers for calendar year 2009 that were allocated to 29 qualified states under Internal Revenue Code §42(h)(3)(D). Revenue Procedure 2009-40 details how $4.61 million of unused LIHTCs were divided among the states in the national pool. California received the largest allocation, $882,632, in LIHTCs.
August
TREASURY TO AMEND SECTION 1602 DISBURSEMENT DEADLINE
WASHINGTON, D.C. - August 28, 2009
An interim final rule scheduled for publication on August 31 will amend the Treasury Department’s policy regarding the time limitation within which state housing credit agencies must disburse funds received under Section 1602 of the American Recovery and Reinvestment Tax Act of 2009. The Treasury Department says it has determined that the requirement that state agencies must disburse Section 1602 low-income housing tax credit (LIHTC) exchange program funds by Dec. 31, 2010 is overly restrictive and may preclude funding of otherwise eligible projects that may not reach final completion by the end of 2010. Therefore, an interim final rule will be published in the August 31 Federal Register that will allow state housing credit agencies, under certain conditions, to disburse exchange program funds to subawardees through Dec. 31, 2011.
TREASURY ANNOUNCES SIXTH ROUND OF EXCHANGE PROGRAM FUNDS
WASHINGTON, D.C. - August 26, 2009
The Treasury Department today announced approximately $309 million in funds will be allocated through the low-income housing tax credit (LIHTC) exchange program created by the American Recovery and Reinvestment Act (Recovery Act) to spur the development of affordable housing units. The funds announced today include $34 million for Arizona; $16 million for Connecticut; $95 million for North Carolina; $3.6 million for North Dakota; $41 million for Pennsylvania; $118 million for South Carolina; and $1.4 million for Vermont. This is the sixth round in a series of awards based on a rolling application process.
IRS ACCEPTS COMMENTS ON FORM 8586, LOW-INCOME HOUSING CREDIT
WASHINGTON, D.C. - August 21, 2009
The Internal Revenue Service (IRS) yesterday invited comments on Form 8586, Low-Income Housing Credit, which is used by owners of residential rental projects providing low-income housing to claim the low-income housing tax credit (LIHTC) for part of the cost of constructing or rehabilitating such low-income housing. Form 8586 is used by taxpayers to compute the credit and by the IRS to verify that the correct credit has been claimed. No changes to the form have been proposed; the invitation to comment was published as part of the effort to reduce paperwork and respondent burden as required by the Paperwork Reduction Act of 1995.
HUD PUBLISHES PROPOSED 2010 FAIR MARKET RENTS
WASHINGTON, D.C. - August 4, 2009
The U.S. Department of Housing and Urban Development (HUD) today published proposed fair market rents (FMRs) for fiscal year 2010. FMRs are used to determine payment standard amounts for the Housing Choice Voucher program, project-based Section 8 contracts and housing assistance payments (HAP) contracts in the moderate rehabilitation Single Room Occupancy (SRO) program. HUD will accept public comments on the proposed FMRs through September 2, 2009.
LIHTC INDUSTRY GROUPS REACH CONSENSUS ON PROPOSALS
WASHINGTON, D.C. - August 3, 2009
The Housing Advisory Group reports that a group of low-income housing tax credit (LIHTC) industry organizations have agreed on a list of consensus issues to present to key housing proponents on Capitol Hill. The group has finalized a letter that outlines three proposals intended to broaden the LIHTC investor market as well as give states the tools they need to produce housing. The three are: a one-year extension of the exchange program including 4 percent tax credits; a five-year LIHTC carryback with 100 percent reinvestment requirement; and changes in the passive-loss provisions to allow for investment by qualified closely held C corps, sub-S corps and limited liability corporations. The Housing Advisory Group says it will reach out to allies in the Congress and work to include all or some of these proposals in legislation this year. Click here to read the letter.
July
FMRs FOR 2010 TO BE PUBLISHED NEXT WEEK
WASHINGTON, D.C. - July 31, 2009
The U.S. Department of Housing and Urban Development (HUD) announced today that proposed fiscal year 2010 fair market rents (FMRs) will be published in the Federal Register on August 4, 2009. FMRs are used to determine payment standard amounts for the Housing Choice Voucher program, project-based Section 8 contracts and housing assistance payments (HAP) contracts in the moderate rehabilitation Single Room Occupancy (SRO) program. Click here to link to copies of the data tables, documentation system and a copy of the preamble for the 2010 proposed FMRs.
TREASURY ANNOUNCES ANOTHER ROUND OF EXCHANGE PROGRAM FUNDS
WASHINGTON, D.C. - July 30, 2009
The Treasury Department today announced approximately $90 million in funds will be allocated through the low-income housing tax credit (LIHTC) exchange program created by the American Recovery and Reinvestment Act (Recovery Act) to spur the development of affordable housing units. The funds announced today include $18 million for Colorado; $4 million for Delaware; $53 million for Illinois; $10 million for Maine; and $4 million for Nebraska. This is the fifth round in a series of awards based on a rolling application process.
HUD POSTS ADDITIONAL TCAP GUIDANCE
WASHINGTON, D.C. - July 29, 2009
The U.S. Department of Housing and Urban Development (HUD) has posted new guidance for the Tax Credit Assistance Program (TCAP). TCAP was created by the American Recovery and Reinvestment Act of 2009 to provide grant funding for capital investment in low-income housing tax credit (LIHTC) projects. The latest guidance includes information on Davis-Bacon prevailing wages, updated program income, grant agreements, written agreements and the Integrated Disbursement and Information System (IDIS). Click here for complete Recovery Act coverage.
HUD ANNOUNCES FINAL ROUND OF APPROVAL UNDER TCAP
WASHINGTON, D.C. - July 28, 2009
U.S. Housing and Urban Development Secretary Shaun Donovan today announced that HUD is approving the final round of plans submitted by state housing finance agencies. The funding in this second round totals more than $1 billion to jumpstart affordable housing programs in 26 states throughout the country that are currently stalled due to the economic recession. This brings the total amount of funding now at work under the Tax Credit Assistance Program (TCAP) to $2.25 billion in all 50 states, the District of Columbia and the Commonwealth of Puerto Rico. Under this second round of TCAP funds, 26 state housing finance agencies are receiving awards today; the first 26 grants under this program were announced on June 30.
TREASURY ANNOUNCES MORE EXCHANGE PROGRAM FUNDING
WASHINGTON, D.C. - July 10, 2009
The Treasury Department today announced $486 million in funds allocated through the low-income housing tax credit (LIHTC) exchange program created by the American Recovery and Reinvestment Act (Recovery Act) to spur the development of affordable housing units. The funds announced today include $36 million in Alabama; $29 million in Arkansas; $34 million in Connecticut; $76 million in Georgia; $114 million in Louisiana; $44 million in Maryland; $51 million in Massachusetts; $16 in Montana; a second round for $17 million in New Hampshire bringing the total to nearly $28 million; $38 million in New Mexico; $20 million to the Virgin Islands; and $10 million to Vermont. This is the fourth round in a series of awards based on a rolling application process; the Treasury Department says it anticipates making similar announcements in the coming weeks.
TREASURY POSTS ADDITIONAL GUIDANCE ON LIHTC EXCHANGE PROGRAM
WASHINGTON, D.C. - July 9, 2009
The Treasury Department today published additional guidance for the low-income housing tax credit (LIHTC) exchange program under Section 1602 of the American Recovery and Reinvestment Act of 2009. Today’s guidance was released as a set of frequently asked questions and answers.
Click here for more information about the Section 1602 LIHTC exchange program. To hear the document discussed in detail, tune in next week to the Tax Credit Tuesday Podcast on July 14.June
HUD APPROVES MORE THAN $1 BILLION IN TCAP FUNDS
WASHINGTON, D.C. - June 30, 2009
U.S. Housing and Urban Development (HUD) Secretary Shaun Donovan today announced that HUD is approving plans submitted by state housing finance agencies for $1,035,322,485 to jump start affordable housing programs in states that are currently stalled due to the economic recession. Funded through American Recovery and Reinvestment Act of 2009, HUD's Tax Credit Assistance Program (TCAP) will allow 26 state housing finance agencies to resume funding of affordable rental housing projects.
The 2009 edition of the Low Income Housing Tax Credit Handbook includes information on the LIHTC provisions of the American Recovery and Reinvestment Act of 2009! Click here to learn more.MEASURE WOULD ALLOW EXCHANGE OF GO ZONE, DISASTER LIHTCS
WASHINGTON, D.C. - June 24, 2009
Sens. Evan Bayh, D-Ind., and Richard Shelby, R-Ala., yesterday proposed legislation that would allow states that were allocated additional low-income housing tax credits (LIHTCs) in 2005 and 2008 for the rebuilding of affordable housing in the Gulf Opportunity (GO) Zone and Midwestern Disaster Areas to exchange those credits under the Section 1602 program created by the Recovery Act. As enacted, the Recovery Act did not specify that the GO Zone and Midwestern Disaster tax credits would be eligible for the exchange program; Sen. Bayh says that S. 1326, the Disaster State Housing Recovery Act clarifies congressional intent by allowing states to exchange GO Zone and Disaster tax credits under Section 1602. An identical bill was introduced in the House by Reps. Artur Davis, D-Ala., and Charles Boustany, R-La. A copy of the legislation will be posted online at www.taxcredithousing.com as soon as it becomes available.
TREASURY ANNOUNCES $268 MILLION MORE IN RECOVERY ACT LIHTC EXCHANGE FUNDS
WASHINGTON, D.C. - June 22, 2009
The Treasury Department today announced $268 million in funds allocated through the low-income housing tax credit (LIHTC) exchange program created by the American Recovery and Reinvestment Act (Recovery Act) to spur the development of affordable housing units in Indiana, Missouri, Tennessee and Washington D.C. The funds announced today include $164 million in Indiana; $17 million in Missouri; $53 million in Tennessee; and $ 33.7 million in the District of Columbia. This is the third round in a series of awards based on a rolling application process; the Treasury Department says it anticipates making similar announcements in the coming weeks.
NOVOGRADAC &. CO'S MANAGING PARTNER TO SPEAK AT NCSHA FORUM
SAN FRANCISCO, Calif. - June 11, 2009
Michael J. Novogradac, managing partner of Novogradac & Company LLP, will be one of 14 top low-income housing tax credit (LIHTC) practitioners to speak at the National Council of State Housing Agencies' (NCSHA) forum on housing credit investment. The forum, part of a three-in-one webcast, is one of the features of NCSHA's Housing Credit Conference & Marketplace, taking place in Los Angeles June 15-18. Click here for more information on the webcast and how you can participate.
TREASURY ANNOUNCES $135 MILLION MORE IN RECOVERY ACT LIHTC EXCHANGE FUNDS
WASHINGTON, D.C. - June 4, 2009
The Treasury Department today announced nearly $135 million in American Recovery and Reinvestment Act (Recovery Act) funds will be given to five states that have elected to exchange for direct cash assistance a portion of their unused allocation of low-income housing tax credits (LIHTCs) intended to spur the development of affordable housing units. The five states and the amounts they will receive are: $72 million in Iowa; $4 million in Maine; $10 million in New Hampshire; $36 million in Rhode Island; and $11 million in Washington. These funds are the second round in a series of awards based on a rolling application process; the Treasury Department says it anticipates making similar announcements in the coming weeks.
FRANK REQUESTS CHANGES TO LIHTC EXCHANGE PROGRAM RULES
WASHINGTON, D.C. - June 2, 2009
Financial Services Committee Chairman Barney Frank, D-Mass., yesterday sent a letter to Treasury Secretary Timothy Geithner requesting modifications to Treasury guidance regarding utilization of the low-income housing tax credit (LIHTC) exchange program under Section 1602 of the American Recovery and Reinvestment Act of 2009. In the letter, Frank asks that the guidance be changed to extend the disbursement deadline, allow state agencies to award the funding as loans, and simplify the recapture provision. Click here to download a copy of the letter.
May
IRS INVITES COMMENTS ON FORM 8611
WASHINGTON, D.C. - May 29, 2009
The Internal Revenue Service (IRS) today invited comments concerning Form 8611, Recapture of Low-Income Housing Credit. If a low-income housing tax credit (LIHTC) property is disposed of during or if it fails to meet certain requirements over a 15-year compliance period and a bond is not posted, the owner must recapture on Form 8611 part of the credits taken in prior years. There are no changes being made to the form at this time; the invitation to comment was issued as part of the Treasury Department’s continuing effort to reduce paperwork and respondent burden as required by the Paperwork Reduction Act of 1995. Written comments will be accepted until July 28, 2009.
HUD, TREASURY MAKE TCAP, EXCHANGE FUNDING ANNOUNCEMENTS
WASHINGTON, D.C. - May 22, 2009
The U.S. Department of the Treasury today announced more than $330 million in American Recovery and Reinvestment Act funding to spur the development of affordable housing units in Kansas, Michigan, Ohio, Wisconsin and Puerto Rico. The Department of Housing and Urban Development (HUD) also announced $83 million for housing development in Ohio. Treasury's announcement today includes the first round of recipients under the low-income housing tax credit exchange program: $115 million in Wisconsin; $99 million in Puerto Rico; $78 million in Michigan; $23 million in Kansas; and $21 million in Ohio. In addition, HUD announced the first award under the Tax Credit Assistance Program (TCAP), providing $83 million to kick-start stalled multifamily developments in Ohio. Submissions from the remaining states, Puerto Rico and the District of Columbia are due to HUD no later than June 3. This is the first of many similar announcements HUD anticipates making in the coming weeks. Click here for more information about today's announcement. Click here for more information about TCAP and the exchange program.
CALIFORNIA PUBLISHES APPLICATION FOR EXCHANGE PROGRAM
SACRAMENTO, Calif. - May 13, 2009
The California Tax Credit Allocation Committee today published an application for cash in lieu of tax credits. The program, created by the American Recovery and Reinvestment Act of 2009, allows those projects that have a 2007 or 2008 reservation of low-income housing tax credits (LIHTCs) that have been unable to secure an equity investor to receive an award equal to the stated equity in the original application up to 85 cents for every currently reserved federal tax credit dollar. In a memo that accompanied the application's release, TCAC says that uncertainty remains about the availability of funds to replace state tax credits. As such, the application published today is only for 2007 and 2008 9 percent LIHTC reservation holders who do not have state tax credits in the deal. Applications must be submitted by 4 p.m. on May 20, 2009. Click here for more information about TCAC's-and other LIHTC allocating agencies'-plans for the Recovery Act's LIHTC provisions.
IRS PUBLISHES UTILITY ALLOWANCE GUIDANCE CLARIFICATION
WASHINGTON, D.C. - May 5, 2009
The Internal Revenue Service (IRS) today issued guidance in Notice 2009-44 to clarify that utility costs paid by a tenant and based on actual consumption in a sub-metered rent-restricted unit are treated as paid directly by the tenant for purposes of Section 42(g)(2)(B)(ii) of the Internal Revenue Code. The IRS says that building owners may rely on Notice 2009-44 for any utility allowances effective no earlier than the first day of the building owner's taxable year beginning on or after July 29, 2008. The IRS will accept comments on Notice 2009-44 through July 27, 2009.
GUIDANCE RELEASED FOR TCAP AND LIHTC EXCHANGE PROGRAM
WASHINGTON, D.C. - May 4, 2009
The Department of Housing and Urban Development (HUD) and Treasury Department today released guidance on the two programs created by the American Recovery and Reinvestment Act of 2009 related to the low-income housing tax credit (LIHTC). Today, HUD issued CPD Notice 09-03 describing the implementation of the Tax Credit Assistance Program (TCAP). This notice explains program requirements and provides guidance to state housing credit agencies on the information they must submit to HUD as a condition of receiving their grant. These submissions are due to HUD within 30 days - by Wednesday, June 3, 2009. HUD has also posted a Questions and Answers document about the TCAP program, and says it will update that information on an ongoing basis.
The Treasury Department also published application information and forms and is now accepting applications from LIHTC allocating agencies for grants in lieu of LIHTCs for 2009.
HUD announced that on Wednesday, May 6, HUD and the Department of Treasury will be conducting a joint web/satellite broadcast on TCAP and the Grants in Lieu of Tax Credits Program.
This guidance will also be discussed in person by industry leaders at Novogradac & Company’s conference A Look Ahead: The LIHTC and the Recovery and Reinvestment Act, May 13-14, 2009 in New Orleans, La.
April
HUD INVITES COMMENT ON APPROVAL PROCESS FOR MULTIFAMILY PROJECTS
WASHINGTON, D.C. - April 29, 2009
The U.S. Department of Housing and Urban Development (HUD) today released a notice inviting recommendations from stakeholders in its insured multifamily projects, as well as interested members of the public, on administrative and procedural changes that HUD should adopt to expedite approval of multifamily housing projects involving low-income housing tax credits (LIHTCs) or tax-exempt bonds under its jurisdiction. In addition to soliciting general recommendations on expediting the approval process of multifamily housing projects, HUD also invited recommendations on a number specific topics including: improving the efficiency of approval procedures; simplifying approval requirements; and establishing time deadlines or target deadlines for required approvals. Click here for a copy of the notice.
IRS RELEASES RULING ABOUT OFF SITE COSTS AND ELIGIBLE BASIS
WASHINGTON, D.C. - April 28, 2009
The costs of constructing streets and related infrastructure improvements that will be dedicated to public use in a low-income housing tax credit project are capitalizable into the bases of project's residential rental buildings, the Internal Revenue Service determined in private letter ruling (PLR) 200916007. The ruling will be examined in detail in the June 2009 issue of the Novogradac Journal of Tax Credit Housing.
GO ZONE CREDITS DO NOT QUALIFY FOR TCEP GRANTS, CAN BE REALLOCATED
WASHINGTON, D.C. - April 27, 2009
The U.S. Treasury Department released a letter today that says that credits allocated under the Gulf Opportunity (GO) Zone Act of 2005 will not be eligible for grants from the Tax Credit Exchange program (TCEP). The letter from Deputy Assistant Secretary (International Tax Affairs) Michael F. Mundaca says that TCEP applies only to low-income housing tax credits allocated under section 42(h)(3)(C) of the Internal Revenue Code. Because GO Zone credits were allocated as “additional credit cap,” states cannot return these credits for grant money. The letter also says that 2008 GO Zone credits returned in 2009 can be reallocated during states’ 2009 allocation rounds. Louisiana’s response, as well as additional information about the American Recovery and Reinvestment Act, can be found here.
Treasury’s treatment of GO Zone and disaster credits under TCEP will be just one of the topics discussed at Novogradac & Company’s conference A Look Ahead: The LIHTC and the Recovery and Reinvestment Act, May 13-14, 2009 in New Orleans, La.
INDIANA LIHTC AGENCY PUBLISHES DRAFT RECOVERY ACT PLAN
INDIANAPOLIS, IND. - April 21, 2009
The Indiana Housing and Community Development Authority (IHCDA) today released a draft of its proposed policies for implementing the two enhancement funding sources for low-income housing tax credit (LIHTC) developments created by the American Recovery and Reinvestment Act of 2009. IHCDA’s plan outlines its policies for the Tax Credit Assistance Program (TCAP) and the Credit Exchange Program. In the notice announcing the proposed policies, IHCDA says Midwestern Disaster Credits are not eligible to be exchanged for cash through Treasury and TCAP funds will not be eligible for developments that have received Midwestern Disaster credits. Public review and comments of the draft will be accepted through May 22, 2009 and a public hearing will be held on May 22 at IHCDA. For more information, and a copy of the proposed policy, click here and scroll down to the section labeled Indiana.
CALIF. RESPONDS TO RECOVERY ACT PLAN COMMENTS
SACRAMENTO, CALIF. - April 16, 2009
Today, the California Tax Credit Allocation Committee (TCAC) released a memo regarding comments received from the public on its proposed regulation changes related to the American Recovery and Reinvestment Act of 2009 and the tax credit program’s final tiebreaker. TCAC says it has carefully considered all comments received, and has finalized the recommendations that it will present to the committee for consideration and adoption on April 30, 2009. Click here for a copy of the memo, which lists the revisions to the initially proposed changes.
GEORGIA RELEASES PRELIMINARY ARRA IMPLEMENTATION PLAN
ATLANTA, GA. - April 9, 2009
The Georgia Department of Community Affairs (DCA) yesterday released its preliminary plan for implementing the low-income housing tax credit (LIHTC) provisions of the American Recovery and Reinvestment Act of 2009. The proposed plan, which is subject to change, addresses how DCA will implement both the Tax Credit Exchange program and the Tax Credit Assistance program. The agency said it released the preliminary plan to help developers get their projects “shovel ready” as soon as possible. DCA will hold a Q&A meeting on the preliminary plan on Wednesday, April 15. Click here to download Georgia’s plan as well as plans and memos from other states related to Recovery Act funding for LIHTC properties.
DCA’s implementation plan and other state responses to the Recovery Act will be the focus of Novogradac & Company’s conference A Look Ahead: The LIHTC and the Recovery and Reinvestment Act, May 13-14, 2009 in New Orleans, La.
March
TENNESSEE PUBLISHES CURRENT PLANS FOR RECOVERY ACT PROVISIONS
NASHVILLE, TENN. - March 31, 2009
The Tennessee Housing Development Agency today released a memo regarding its 2009 low-income housing tax credit (LIHTC) program and its plans to implement the LIHTC provisions of the American Recovery and Reinvestment Act of 2009. The memo notes that the agency is still waiting on guidance from Treasury and the U.S. Department of Housing and Urban Development (HUD) regarding the requirements and administration. In the interim, today’s memo describes staff expectations regarding how TDHA’s current plans for the Recovery Act’s provisions will affect the 2009 LIHTC application round. Click here to download the memo from Tennessee, as well as similar announcements from several other state LIHTC allocating agencies.
TDHA’s regulations and other state responses to the Recovery Act will be the focus of Novogradac & Company’s conference A Look Ahead: The LIHTC and the Recovery and Reinvestment Act, May 13-14, 2009 in New Orleans, La.
HUD SEEKS INPUT ON LIHTC TENANT DATA COLLECTION REQUIREMENT
WASHINGTON, D.C. - March 30, 2009
The U.S. Department of Housing and Urban Development (HUD) today invited early input from state housing agencies and other interested stakeholders on a methodology or approach to meet the low-housing tax credit (LIHTC) tenant data collection requirement of the Housing and Economic Recovery Act of 2008 (HERA). HERA requires state LIHTC allocating agencies to submit to HUD, not less than annually, certain demographic and economic information on households residing in LIHTC properties. The statute also requires HUD to establish standards and definitions for the information that state housing agencies must submit, and to provide them with technical assistance in establishing systems to compile and submit the information. Today's notice seeks early input on a methodology or approach to meet this statutory requirement in advance of HUD's submission of a formal proposal for public comment. HUD will accept comments through May 29, 2009. Click here for a copy of the notice. Click here for more information about HERA.
REAC EXTENSION GRANTED BY HUD FOR SOME MULTIFAMILY PROPERTY OWNERS
WASHINGTON, D.C. - March 26, 2009
Due to U.S. Department of Housing and Urban Development (HUD) infrastructure performance problems, multifamily property owners have experienced difficulties submitting their financial statements due March 30, 2009 (for owners with a fiscal year end on December 31, 2008). The Office of Multifamily Housing Programs, Office of Asset Management has authorized the Real Estate Assessment Center (REAC) to implement a blanket 30-day extension only for owners whose project fiscal year ends December 31, 2008. Owners/auditors should not request an extension in the Financial Assessment Sub System (FASS); the extension has been automatically implemented. The extended FASS due date is April 30, 2009. HUD says owners who submit the financial statements on or before April 30 will not be referred to the Departmental Enforcement Center or be flagged in the Active Partners Performance System.
NOVOGRADAC'S RENT & INCOME CALCULATOR UPDATED FOR 2009
WASHINGTON, D.C. - March 25, 2009
Novogradac & Company LLP's Rent & Income Limit Calculator© has been updated to include the U.S. Department of Housing and Urban Development's (HUD) 2009 rent and income limit data. It is available online at www.novoco.com/products/rentincome.php with the compliments of Novogradac & Company LLP.
The Rent & Income Limit Calculator© will calculate IRS Section 42(i)(3)(A) low-income housing tax credit (LIHTC) rent and income limits for every county and for every metropolitan statistical area (MSA) in the United States. It also provides the HUD sourced 30 percent, 50 percent and 80 percent income limits for a selected county; automatically calculates the LIHTC rent and income limits for any selected percentage of the area median income (AMGI) for the selected county; and allows users to select parameters to calculate rent and income limits for other affordable housing programs.
The Rent & Income Limit Calculator© also allows users to choose which bedroom sizes are displayed (the default setting displays results for all bedroom sizes) and choose which income or rent levels are displayed on the 10 year historical charts.
New this year, the Rent & Income Limit Calculator© has been updated to incorporate changes to the law made by the Housing and Economic Recovery Act of 2008 (HERA). Also, a new field has been added in which users can type the project name, resulting in the project name being displayed on the last page.
HUD RELEASES INCOME LIMITS FOR 2009
WASHINGTON, D.C. - March 19, 2009
The U.S. Department of Housing and Urban Development (HUD) today released income limits for 2009. Click here for links to the income limits and accompanying information and tables. Under the Housing and Economic Recovery Act of 2008 (Public Law 110-289), income limits used to determine qualification levels as well as set maximum rental rates for projects funded with low-income housing tax credits (LIHTC) and projects financed with tax-exempt housing bonds - referred to by HUD as Multifamily Tax Subsidy Projects (MTSPs) - are now calculated and presented separately from the Section 8 income limits. Both MTSP and Section 8 income limit data have been posted here.
To hear this news discussed in detail, tune in next week to the Tax Credit Tuesday Podcast on March 24.
Novogradac & Company LLP is currently updating its Rent & Income Limit Calculator© to include 2009 data. Subscribers to the free Industry Alert E-mail service will receive an e-mail announcement when the update has been completed.
CALIFORNIA PROPOSES NEW REGULATIONS FOR RECOVERY ACT FUNDS
SACRAMENTO, CALIF. - March 18, 2009
The California Tax Credit Allocation Committee (TCAC) yesterday released a new proposed regulation section incorporating the American Recovery and Reinvestment Act of 2009, specifically the Tax Credit Assistance Program (TCAP) funding and credit exchange program. TCAC says it is providing the proposed regulations while waiting for more detailed program guidance from the Department of Housing and Urban Development (HUD) and the Secretary of the Treasury regarding these funding sources. HUD is expected to post the TCAP rules shortly, and it is likely that states will have short timelines for providing the plans they adopt for administering those funds. To prepare for the anticipated short federal timelines, TCAC says its staff is promulgating the proposed regulations for public review and comment. Comments on those regulations will be accepted in writing and at three public hearings. TCAC says the proposed regulations are likely to evolve as staff receive public comments and receive additional federal guidance.
TCAC’s regulations and other state responses to the Recovery Act will be the focus of Novogradac & Company’s conference A Look Ahead: The LIHTC and the Recovery and Reinvestment Act, May 13-14, 2009 in New Orleans, La.
DELAWARE RELEASES MEMO ADDRESSING GOALS FOR ARRA PROVISIONS
DOVER, DEL. - March 11, 2009
The Delaware State Housing Authority today released a memo regarding the American Recovery and Reinvestment Act of 2009. The memo describes the two low-income housing tax credit (LIHTC) programs created by the Recovery Act and outlines the authority’s goals for implementing those programs. Click here to download the memo from Delaware and more than a dozen similar announcements from other state LIHTC allocating agencies.
February
ARRA EXCHANGE PROGRAM GRANTS DO NOT REDUCE ELIGIBLE BASIS
SAN FRANCISCO, CALIF. - February 25, 2009
In today's webinar on the American Recovery and Reinvestment Act of 2009, Novogradac & Company noted that it had been told by the Internal Revenue Service that grants received under the credit exchange program were federal grants, and while they were not taxable income and did not reduce depreciable basis, they did reduce eligible basis. The statute states that "basis" is not reduced, and we had argued that the statutory reference to "basis" should mean both eligible and depreciable basis.
We have since received a revised interpretation from Treasury, that upon further reflection, it believes that grants received under the credit exchange program do not reduce eligible basis.
This is a significant interpretative victory for the low-income housing tax credit community, and will be of benefit to affordable housing developments that receive both credit exchange grants and a low-income housing tax credit allocation. We expect that the Internal Revenue Service will issue interpretive guidance to this effect.
HUD ALLOCATES $2.25 BILLION FOR TAX CREDIT PROGRAM
WASHINGTON, D.C. - February 25, 2009
The U.S. Department of Housing and Urban Development (HUD) today announced that it allocated nearly 75 percent of the $13.61 billion of funding provided by the American Recovery and Reinvestment Act of 2009 for projects and programs administered by HUD. The funding announced today is primarily formula-based, including $2.25 billion for the Tax Credit Assistance Program (TCAP). TCAP grants are funded under HUD's HOME program and are meant to help state housing finance agencies kick-start the production of stalled affordable rental housing projects that rely on low-income housing tax credits (LIHTCs). Click here for more information, including a table of TCAP funding amounts by state.
To learn more about this program, and the other tax credit provisions included in the Recovery Act, tune in to The Recovery and Reinvestment Act of 2009 Webinar. The live session will be held from 10:00 a.m. - 12:00 p.m. Pacific Standard Time today, and a recording of the webinar will be available for download shortly after the event concludes.
The implementation of the Recovery Act and an assessment of its impact will also be the focus of the New Orleans LIHTC Finance Conference on May 13-14, 2009. Novogradac & Company is currently developing the agenda for the event, which will feature panel discussions on topics including: income and accounting implications of credit exchange dollars and HOME fund dollars; ways to use credit exchange dollars; asset management by state agencies; the impact of ARRA on TEB financed transactions; and investor reactions to ARRA.CALIFORNIA POSTPONES FIRST ROUND LIHTC APPLICATIONS
SACRAMENTO, CALIF. - February 23, 2009
The California Tax Credit Allocation Committee (TCAC) today announced that it is postponing the due date for its first round of low-income housing tax credit (LIHTC) applications and its upcoming application workshops. With the enactment of the American Recovery and Reinvestment Act of 2009, TCAC will be promulgating regulations modifying the qualified allocation plan (QAP) to make available the new federal HOME and credit exchange resources. TCAC staff is conferring with California stakeholders, other states and federal officials, and intends to develop draft regulations shortly. TCAC says it will disclose the new first-round application deadline as soon as we it establishes the timing for adopting new regulations.
To learn more about how state housing tax credit agencies are responding to the enactment of the American Recovery and Reinvestment Act of 2009, tune in to The Recovery and Reinvestment Act of 2009 Webinar on February 25, 2009.
AMERICAN RECOVERY AND REINVESTMENT ACT SIGNED INTO LAW
DENVER, COLO. - February 17, 2009
President Barack Obama today signed into law the American Recovery and Reinvestment Act of 2009 at a signing ceremony held at the Denver Museum of Nature & Science. The new law includes enhancements to the new markets tax credit (NMTC), renewable energy tax credit (RETC) and low-income housing tax credit (LIHTC) programs.
Tune in to today’s Tax Credit Tuesday podcast to hear more about the tax credit provisions included in the $787 billion economic recovery package.
Next week, on Wednesday, February 25 Novogradac & Company will present a webinar about the American Recovery and Reinvestment Act. Michael J. Novogradac, managing partner in the San Francisco office of Novogradac & Company LLP, will describe the provisions of the new law including:
- the additional $3 billion in new markets tax credit authority provided for 2008 and 2009;
- the extensions of placed in service dates for renewable energy facilities;
- the temporary permission to elect the investment tax credit in lieu of the production tax credit;
- the low-income housing tax credit exchange provision; and
- the $2.25 billion in gap funding for LIHTC projects.
AGREEMENT ANNOUNCED ON RECOVERY LEGISLATION
WASHINGTON, D.C. - February 11, 2009
Congressional conferees today announced they had reached a tentative agreement on an economic recovery package. While some of the details remain to be finalized, the legislation is said to include approximately $789 billion in spending and tax provisions. Initial reports indicate that that the low-income housing tax credit (LIHTC) exchange provision passed in the House bill is included in the final package, as is a provision to provide new funds that will be provided to fill gaps in LIHTC funding although the amount of that funding is still unclear. At this writing, it is also unclear whether the final bill includes the LIHTC accelerator provision that was passed as part of the Senate bill. Updates will be provided online at www.taxcredithousing.com as soon as additional information becomes available.
Novogradac & Company LLP is planning a webinar on the provisions of the economic recovery legislation. Details will be posted shortly at www.novoco.com/events.
SENATE OKS RECOVERY BILL WITH LIHTC, NMTC, RETC PROVISIONS
WASHINGTON, D.C. - February 10, 2009
The Senate today voted 61 to 37 to approve H.R. 1, the American Recovery and Reinvestment Act of 2009. The Senate version of the economic recovery package includes a provision to accelerate the low-income housing tax credit (LIHTC) allowing investors to claim 20 percent of the allowable credits in each of the first three years, and the remaining 40 percent over the next seven years. The bill also provides $2 billion dollars of LIHTC gap financing.
The Senate measure would also authorize an additional $1.5 billion for the 2008 new markets tax credit (NMTC) allocation round and an additional $1.5 billion for the 2009 allocation round. The NMTCs allocated for the 2009 round would be allowed against the alternative minimum tax.
In addition, the Senate’s proposal extends the placed-in-service date for wind facilities through December 31, 2012 and through December 31, 2013 for certain other qualifying facilities. The proposal would also temporarily allow renewable energy production facilities to elect the investment tax credit in lieu of the production tax credit.
Click here for a summary of the finance provisions included in the final version of the Senate bill. The legislation will now go through a conferencing process to resolve differences with the House-passed recovery legislation. Lawmakers have indicated they intend to deliver a final bill to the president for his signature by the end of this week.
A discussion about the House and Senate recovery bills will be presented in this week’s Tax Credit Tuesday podcast, which will be posted online by 1 p.m. Pacific time.SUPPORT NEEDED TODAY FOR LIHTC ACCELERATOR AMENDMENT
WASHINGTON, D.C. - February 4, 2009
Sen. Maria Cantwell, D-Wash., today filed an amendment to the Senate economic recovery proposal that would accelerate the amount of low-income housing tax credits that could be claimed in the first three years while still retaining the full 10-year credit period. This proposal is an integral part of the comprehensive package of affordable housing provisions that the LIHTC community has recommended as part of the American Recovery and Reinvestment Act of 2009.
The amendment is currently sponsored by Sens. Cantwell, Kerry, Snowe, Schumer, Stabenow, Bingaman, Ensign, Carper, Hatch, Wyden, Cardin, and Nelson. Those in the LIHTC community are urged to call or e-mail their Senators today who are not currently sponsors, and ask them to support the Cantwell LIHTC amendment. Click here for a copy of the Cantwell amendment as well as the industry sign-on letter supporting the package of affordable housing proposals.
January
AMENDMENT TO SENATE RECOVERY BILL WOULD ACCELERATE LIHTCS
WASHINGTON, D.C. - January 26, 2009
The Senate Finance Committee will consider an amendment to its economic recovery proposal that would accelerate the amount of low-income housing tax credits that could be claimed in the first three years while still retaining the full 10-year credit period. Supporters say this could increase yields and book earnings to investors thereby attracting more investors to the weakened LIHTC equity market without significantly lowering tax credit prices. The Senate Finance Committee will consider the American Recovery and Reinvestment Act of 2009 during a hearing tomorrow.
The amendment is currently cosponsored by Sens. Maria Cantwell, D-Wash., Charles Schumer, D-N.Y., John Kerry, D-Mass., Debbie Stabenow, D-Mich., Olympia Snowe, R-Maine, and John Ensign, R-Nev. Additional support for the amendment is still needed. Those in the LIHTC community are encouraged to contact their members of Congress, particularly Chairman Max Baucus, D-Mont., and members of the Senate Finance Committee, to express support for the amendment.SENATE ECONOMIC RECOVERY INTRODUCED WITHOUT LIHTC PROVISIONS
WASHINGTON, D.C. - January 23, 2009
The Senate Finance Committee today unveiled the details of its proposal for an economic recovery package, which includes a five year carryback for general business tax credits but does not include new federal support for the low-income housing tax credit program nor incentives to help the industry raise new investor capital. The Senate Finance Committee is scheduled to hold a hearing on the American Recovery and Reinvestment Act on January 27.
Tune in to the Tax Credit Tuesday podcast on January 27 to hear Michael J. Novogradac, CPA, discuss the latest developments in the ongoing consideration of the Senate and House economic recovery proposals.HELP URGED TO SUPPORT LIHTC PROVISIONS FOR RECOVERY BILL
WASHINGTON, D.C. - January 16, 2009
The House version of an economic recovery bill was released yesterday and despite initial hopes, the bill as it currently stands contains neither new federal support for the low-income housing tax credit (LIHTC) program nor new incentives to help the industry raise new investor capital. The Affordable Housing Tax Credit Coalition is currently reaching out to lawmakers about including the coalition's proposals in the forthcoming Senate version of the economic recovery package as well as reconsidering the proposals for future inclusion in the House version.
AHTCC is urging those in the LIHTC community to contact their Senators and Representatives immediately and ask that they support AHTCC's proposals. To assist supporters of the program in advocating on behalf of the LIHTC, the coalition has provided a copy of a joint letter that was written and cosigned by a number of LIHTC stakeholders, including the AHTCC, Enterprise Community Partners, Housing Advisory Group, Local Initiatives Support Corporation and the National Association of State and Local Equity Funds.
SENATE COMMITTEE HOLDS HEARING FOR HUD SECRETARY POST
WASHINGTON, D.C. - January 13, 2009
The Senate Banking, Housing and Urban Affairs Committee today held a nomination hearing for Shaun Donovan, secretary-designate for the U.S. Department on Housing and Urban Development (HUD). Click here to download copies of the prepared statements made by committee Chairman Chris Dodd, D-Conn., and secretary-designate Donovan.
Donovan’s nomination is one of the many topics discussed in today’s Tax Credit Tuesday podcast as well as in a panel discussion at last week’s 15th Annual Affordable Housing Developers Conference in Miami. A recording of that panel discussion is available for download here.
HUD ANNOUNCES 2009 ANNUAL ADJUSTMENT FACTORS
WASHINGTON, D.C. - January 12, 2009
The U.S. Department of Housing and Urban Development (HUD) today published revised Annual Adjustment Factors (AAFs) for adjustment of Section 8 contract rents for specified programs. These AAFs apply to housing assistance payment contract anniversaries for calendar months commencing after today. Click here for more information.
INTERAGENCY CRA GUIDANCE UPDATED
WASHINGTON, D.C. - January 7, 2009
The Office of the Comptroller of the Currency, Treasury (OCC), Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation (FDIC) and Office of Thrift Supervision (OTS) yesterday announced the publication of new and revised Interagency Questions and Answers Regarding Community Reinvestment. The questions and answers interpret the agencies’ Community Reinvestment Act (CRA) regulations and provide guidance to financial institutions and the public. The agencies proposed the questions and answers on July 11, 2007. After considering the comments, the agencies adopted the majority of the questions and answers as they were proposed or with revisions in response to the comments. In addition, they are proposing for comment one new and two revised questions and answers. Comments on the proposed provisions are due by March 9, 2009. For more information on the CRA, including these questions and answers and the agencies’ CRA regulations, visit the CRA Resource Center.