Low-Income Housing Tax Credits:

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2011

 
December

CALIF. SUPREME COURT RULES RDAS CAN BE ELIMINATED

SACRAMENTO, Calif. – December 29, 2011

The California Supreme Court today ruled to uphold Assembly Bill 1X 26 and invalidate Assembly Bill 1X 27. In its opinion in the case of California Redevelopment Association v. Matosantos, the court found that redevelopment agencies (RDAs) do not have a protected right to exist that immunizes them from statutory dissolution by the Legislature; and that RDAs and their sponsoring communities do have a protected right not to make payments to various funds benefiting schools and special districts as a condition of continued operation.

Tune in to the Tax Credit Tuesday Podcast on January 3 to hear from Michael J. Novogradac, CPA, what this ruling means for affordable housing development in California. For questions about the ruling, contact James R. Kroger, CPA, at jim.kroger@novoco.com.

IRS PROVIDES GUIDANCE ON CURRENT REFUNDINGS OF TAX-EXEMPT BONDS

WASHINGTON, D.C. – December 28, 2011

The Internal Revenue Service (IRS) today issued Notice 2012-3 to provide guidance on current refunding issues that are used to refund original tax-exempt bonds under certain disaster relief programs. The notice applies to qualified bonds under the Gulf Opportunity Zone, Midwest Disaster Area and Hurricane Ike Disaster Area programs. The IRS said that a current refunding issue that meets all requirements outlined in the notice may be issued after the specified deadline for the issuance of the original qualified bonds and be treated as an issue of qualified bonds.

IRS SUSPENDS CERTAIN REQUIREMENTS FOR IOWA LIHTC PROPERTIES

WASHINGTON, D.C. – December 21, 2011

The Internal Revenue Service (IRS) issued Notice 2012-07 to grant certain low-income housing tax credit (LIHTC) properties relief from specified Section 42 requirements to provide emergency housing relief needed as a result of the devastation caused by flooding in Iowa during the period of May 25, 2011 to August 1, 2011. The IRS said it will suspend temporarily income limitation and non-transient requirements for LIHTC properties that have received approval from the Iowa Finance Authority to rent vacant units to individuals displaced by natural disasters. Other rules and requirements of Section 42 will continue to apply during the temporary housing period.

LEGISLATION INTRODUCED TO MAKE FIXED LIHTC FLOOR PERMANENT

WASHINGTON, D.C. – December 14, 2011

A bipartisan group of lawmakers in the House and Senate today introduced legislation to make permanent the 9 percent tax credit percentage floor for the low-income housing tax credit (LIHTC) as originally but temporarily authorized by the Housing and Economic Recovery Act of 2008 (HERA). The legislation would also extend the same policy to 4 percent LIHTCs for acquisition (but not 4 percent LIHTCs generated by tax-exempt bonds). The House bill, H.R. 3661, is cosponsored by Reps. Pat Tiberi, R-Ohio; Richard Neal, D-Mass.; Vern Buchanan, R-Fla.; Jim Gerlach, R-Pa.; Lee Terry, R-Neb.; Charles Rangel, D-Mass.; Bill Pascrell, Jr., D-N.J.; Joseph Crowley, D-N.Y.; and Emanuel Cleaver, D-Mo. The Senate bill, S. 1989, is cosponsored by Sens. Maria Cantwell, D-Wash.; Olympia Snowe, R-Maine; Jeff Bingaman, D-N.M.; John Kerry, D-Mass.; Bill Nelson, D-Fla.; Robert Menendez, D-N.J., Ben Cardin, D-Md.; Bernie Sanders, I-Vt.; Mike Crapo, R-Idaho; Scott Brown, R-Mass.; and Susan Collins, R-Maine.

Join Novogradac & Company for the 18th Annual Tax Credit Developers Conference to hear about the bill’s provisions and what they will mean for the affordable housing community. The conference will be held on January 12-13, 2012 in Miami, Fla. and there’s still time to register.

FINAL 2012 RENT & INCOME LIMIT CALCULATOR© POSTED

SAN FRANCISCO, Calif. – December 14, 2011

Novogradac & Company LLP has released the final version of the Rent & Income Limit Calculator© featuring the U.S. Department of Housing and Urban Development's (HUD) 2012 rent and income limit data. The Rent & Income Limit Calculator© can calculate IRC 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. The calculator is available online at www.novoco.com/products/rentincome.php with the compliments of Novogradac & Company LLP.

If you have questions about the income limits, or would like to engage Novogradac & Company LLP to calculate the rent and income limits for your property, please contact Jim Kroger at jim.kroger@novoco.com.

NCSHA UPDATES LIHTC & UNDERWRITING RECOMMENDED PRACTICES

WASHINGTON, D.C. – December 12, 2011

The National Council of State Housing Agencies (NCSHA) Board of Directors on December 5 approved updates to its low-income housing tax credit (LIHTC) and underwriting recommended practices. The document, which is a revision of NCSHA’s 2010 recommended practices, covers per cost unit limits and sponsor certification of project sources and uses of funds.

Get a more in depth report on NCSHA’s recommended practices by tuning in to the Tax Credit Tuesday podcast on December 20.

NOVOGRADAC'S RENT & INCOME LIMIT CALCULATOR UPDATED FOR 2012

WASHINGTON, D.C. – December 6, 2011

Novogradac & Company LLP is pleased to announce that the Rent & Income Limit Calculator© has been updated to include the U.S. Department of Housing and Urban Development's (HUD) 2012 rent and income limit data. The Rent & Income Limit Calculator© will calculate IRC 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. A Beta version is available online at www.novoco.com/products/rentincome.php with the compliments of Novogradac & Company LLP.

We encourage and welcome your comments on this Beta version of the Rent & Income Calculator© at CPAs@novoco.com. A final version of the calculator will be launched in approximately one week.

If you would like to engage Novogradac & Company LLP to calculate the rent and income limits for your property, please contact Jim Kroger at jim.kroger@novoco.com.

HUD RELEASES INCOME LIMITS FOR 2012

WASHINGTON, D.C. – December 1, 2011

The U.S. Department of Housing and Urban Development (HUD) today released income limits for 2012. Click here for links to the 2012 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 calculated and presented separately from the Section 8 income limits.

Novogradac & Company LLP is currently updating its Rent & Income Limit Calculator© to include 2012 data. Subscribers to Novogradac & Company's free Industry Alert E-mail service will receive an e-mail announcement when the update has been completed.

For questions about the new 2012 income limits please email Jim Kroger, CPA, at jim.kroger@novoco.com or click here to learn more about Novogradac & Company's property compliance services.

November

IRS SAYS SALE OF STATE TAX CREDITS TAXABLE

WASHINGTON, D.C. – November 29, 2011

The Internal Revenue Service (IRS) on November 25 released Chief Counsel Advice memorandum (CCA) 201147024 stating that the sale of certain Massachusetts state tax credits, including low-income housing and historic tax credits, to a third party by the original recipient is a taxable event. Additionally, the IRS said that the original recipient has no tax cost basis in the tax credit and that the original recipient’s gain on the sale of a nonrefundable credit is capital gain. For the purchaser, basis for the tax credit is the cost of the tax credit and the purchaser must recognize apportioned gain, if the tax credit is purchased for less than its face value, when the tax credit is used to satisfy state tax liability.

To learn more about CCA 201147024 and what it could mean for industry stakeholders, please join Novogradac & Company at the Tax Credit Housing Finance Conference on December 1-2 in Las Vegas, Nev.

TREASURY EXTENDS NEW ISSUE BOND, TEMPORARY CREDIT & LIQUIDITY PROGRAMS

WASHINGTON, D.C. – November 23, 2011

The U.S. Department of the Treasury has extended the New Issue Bond Program (NIBP) through 2012 and the Temporary Credit and Liquidity Program (TCLP) through 2015, report the National Council of State Housing Agencies and the National Association of Local Housing Finance Agencies. Treasury has provided an NIBP term sheet and a TCLP term sheet and an election letter that state housing finance agencies must submit to Treasury by December 9 if they wish to continue using the NIBP. Treasury also plans to hold a webinar on the NIBP extension on November 29.

Tune in to the Tax Credit Tuesday podcast on November 29 to learn more about the NIBP and TCLP extensions.

IRS DISTRIBUTES UNUSED 2011 LIHTC ALLOCATION

WASHINGTON, D.C. – November 17, 2011

The Internal Revenue Service (IRS) today published the amounts of unused low-income housing tax credit (LIHTC) carryovers for calendar year 2011 that were allocated to 28 qualified states under Internal Revenue Code §42(h)(3)(D). Revenue Procedure 2011-57 details how nearly $3.66 million of unused LIHTCs were divided among the states in the national pool. California received the largest allocation, $570,425 in LIHTCs.

October

HUD DESIGNATES DDAs FOR 2012

WASHINGTON, D.C. – October 27, 2011

The U.S. Department of Housing and Urban Development (HUD) today designated difficult development areas (DDAs) for 2012 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. The designations of qualified census tracts (QCTs) under IRC Section 42 published October 6, 2009, remain in effect.

In addition to announcing the 2012 DDA designations, HUD invited public comment on whether it should use Small Area Fair Market Rents (FMRs), rather than metropolitan-area FMRs, in future designations of metropolitan DDAs. Comments on this proposal and the 2012 DDAs will be accepted through December 27, 2011.

Tune in to the Tax Credit Tuesday podcast on November 1 to hear more about the new 2012 DDAs.

Join Novogradac & Company at the Tax Credit Housing Finance Conference on December 1-2 in Las Vegas, Nev. to discuss what lies ahead for LIHTC project financing in 2012.

IRS SUSPENDS CERTAIN REQUIREMENTS FOR NEW YORK LIHTC PROPERTIES

WASHINGTON, D.C. – October 21, 2011

The Internal Revenue Service (IRS) issued Notice 2011-87 to grant certain low-income housing tax credit (LIHTC) properties relief from specified Section 42 requirements to provide emergency housing relief needed as a result of the devastation caused by Hurricane Irene in New York during the period of August 26, 2011 to September 5, 2011 or the remnants of Tropical Storm Lee during the period of September 7 to September 11, 2011. The IRS said it will temporarily suspend income limitation and non-transient requirements for LIHTC properties that have received approval from the New York State Homes and Community Renewal Agency to rent vacant units to individuals displaced by natural disasters. Other rules and requirements of Section 42 will continue to apply during the temporary housing period.

IRS INCREASES LIHTC, BOND CAPS FOR 2012

SAN FRANCISCO, CALIF. – October 20, 2011

The Internal Revenue Service (IRS) announced in Revenue Procedure 2011-52 the inflation-adjusted low-income housing tax credit (LIHTC) and private activity bond caps for 2012. For calendar year 2012, the amount used under §42(h)(3)(C)(ii) to calculate the state LIHTC is the greater of $2.20 multiplied by the state population or $2,525,000. The amount used under §146(d)(1) to calculate the state ceiling for the volume cap for private activity bonds in 2012 is the greater of $95 multiplied by the state population or $284,560,000.

COURT PLACES CASE CHALLENGING CALIF. REDEVELOPMENT AGENCIES ON CALENDAR

SAN FRANCISCO, CALIF. – October 19, 2011

The California Supreme Court today placed California Redevelopment Association. v. Matosantos on its November 10 calendar. The court had promised that it would hear the case, which challenges the validity of eliminating California redevelopment agencies, as early as possible in 2011 in order to issue an opinion by January 15, 2012.

IRS SUSPENDS CERTAIN REQUIREMENTS FOR PENNSYLVANIA LIHTC PROPERTIES

WASHINGTON, D.C. – October 14, 2011

The Internal Revenue Service (IRS) issued Notice 2011-83 to grant certain low-income housing tax credit (LIHTC) properties relief from specified Section 42 requirements to provide emergency housing relief needed as a result of the devastation caused by Hurricane Irene in Pennsylvania during the period of August 26, 2011 to August 30, 2011 or Tropical Storm Lee beginning on September 3, 2011. The IRS said it will temporarily suspend income limitation and non-transient requirements for LIHTC properties that have received approval from the Pennsylvania Housing Finance Agency to rent vacant units to individuals displaced by natural disasters. Other rules and requirements of Section 42 will continue to apply during the temporary housing period.

REGULATORS RELEASE DRAFT VOLCKER RULE

WASHINGTON, D.C. – October 11, 2011

The Federal Deposit Insurance Corporation (FDIC) met today to discuss a proposed notice of rulemaking about prohibitions and restrictions on proprietary trading and certain interests in, and relationships with, hedge funds and private equity funds, known as the Volcker Rule.

Tune in to today’s Tax Credit Tuesday podcast to hear Michael J. Novogradac, CPA, discuss the rule’s significance the tax credit community, specifically how it may affect banks’ ability to continue to invest in low-income housing tax credits, new markets tax credits and renewable energy tax credits.  

BILL INTRODUCED TO QUALIFY HOMELESS YOUTH FOR LIHTC HOUSING

WASHINGTON, D.C. – October 5, 2011

Reps. Jim McDermott, Erik Paulsen and Keith Ellison on Monday introduced legislation to allow formerly homeless youth to pursue a four-year education and still qualify for low-income housing tax credit (LIHTC) housing. H.R. 3076 would alter the LIHTC program’s student rule, which currently prohibits most low-income tenants from being full-time students unless they are single parents, parents receiving public assistance or former foster youth. The bill would add another exemption within the Internal Revenue Code for homeless youth. H.R. 3076 was referred to the House Ways and Means Committee.

Tune in to the October 11 Tax Credit Tuesday Podcast to hear Michael J. Novogradac, CPA, discuss more details about the effects this proposal could have on LIHTC regulations.

September

HUD POSTS 2012 FMRS, SETS 12/1 INCOME LIMIT RELEASE DATE

WASHINGTON, D.C. – September 30, 2011

The U.S. Department of Housing and Urban Development (HUD) today released its final fair market rents (FMRs) for fiscal year (FY) 2012. The FY 2012 FMRs take effect October 1. HUD uses FMRs 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 notice also set December 1 as the formal publication date for income limits, beginning with FY 2012’s income limits. For more information about the FMRs and the new release date for annual income limit data, tune in to the October 4 Tax Credit Tuesday podcast.

CALIF. SUPREME COURT DENIES CRA MODIFIED STAY REQUEST

SACRAMENTO, Calif. – September 19, 2011

The California Supreme Court on September 14 denied the California Redevelopment Association’s (CRA’s) request for a modified stay that would have allowed redevelopment agencies that agreed to make remittance payments under the alternative voluntary redevelopment program to initiate new activities or obligations. The denial means that all redevelopment agencies can only service existing debt obligations until the court rules on the case. The court has said that it will deliver a ruling by January 15, 2012. Tune in to the Tax Credit Tuesday podcast on September 27 to learn more about the ruling and what it means for housing development in California.

IRS SUSPENDS REQUIREMENTS FOR CERTAIN VERMONT LIHTC PROPERTIES

Washington, D.C. – September 16, 2011

The Internal Revenue Service (IRS) today issued Notice 2011-74 to grant certain low-income housing tax credit (LIHTC) properties relief from specified Section 42 requirements to provide emergency housing relief needed as a result of the devastation caused by Tropical Storm Irene in Vermont beginning on August 27, 2011. The IRS said it will temporarily suspend income limitation and non-transient requirements for LIHTC properties that have received approval from the Vermont Housing Finance Agency to rent vacant units to individuals displaced by natural disasters. Other rules and requirements of Section 42 will continue to apply during the temporary housing period.

IRS INVITES COMMENT ON MO. HOUSING RELIEF

Washington, D.C. September 8, 2011

The Internal Revenue Service (IRS) today requested comments on its notice that suspended certain requirements for low-income housing tax credit properties in Missouri. The IRS, in Notice 2011-47, suspended the income limits, non-transient requirements and other requirements to areas of the state devastated by severe storms, tornadoes and flooding that began on April 19, 2011. No changes are being made to Notice 2011-47 at this time. The IRS will accept comments on the notice until November 7, 2011.

August

CALIFORNIA CONSIDERS GEOGRAPHIC APPORTIONMENT UPDATE

SACRAMENTO, CALIF. - August 31, 2011

The California Tax Credit Allocation Committee (TCAC) yesterday announced that it is considering updating the apportionment of federal and state low-income housing tax credit among the agency’s geographic regions. TCAC most recently revised the apportionment in 2004. The memo outlines the methodology adopted in 2004, provides preliminary data updating the previous apportionment percentages, and facilitates a discussion with stakeholders regarding possible alternatives in updating the apportionments. In the memo, TCAC invited stakeholders to discuss the proposed update at regional conferences this fall, as well as at scheduled public hearings to be held on proposed 2012 regulation changes.

CALIFORNIA RELEASES REPORT ON COST CONTAINMENT FORUMS

SACRAMENTO, CALIF. - August 24, 2011

The California Tax Credit Allocation Committee (TCAC) yesterday released a summary of the comments that it received from stakeholders about costs associated with building affordable housing. TCAC gathered the comments during three forums that it held in July. The cost containment forums report includes comments on scoring, public policies, land costs and local requirements. TCAC plans to gather and analyze more data and will hold a public hearing in September on the subject.

Tune in to the Tax Credit Tuesday podcast on August 30 to hear more about the report.

HUD RELEASES PROPOSED FY 2012 FMRS

WASHINGTON, D.C. - August 19, 2011

The U.S. Department of Housing and Urban Development (HUD) today released its proposed fair market rents (FMRs) for fiscal year 2012. HUD uses FMRs 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. HUD is accepting comments on the proposed FMRs until September 19, 2011. For more information about the proposed FMRs, tune in to the August 23 Tax Credit Tuesday podcast.

CALIF. SUPREME COURT HALTS REDEVELOPMENT AGENCY DISMANTLING

SAN FRANCISCO, Calif. - August 11, 2011

The California Supreme Court today issued a partial stay that halts the dismantling of California’s redevelopment agencies. The stay is in response to a lawsuit, California Redevelopment Association. v. Matosantos, which challenges the validity of eliminating the redevelopment agencies. Under the order, redevelopment agencies are still barred from incurring new indebtedness, transferring assets, acquiring real property, entering into new contracts or modifying existing contracts, entering into new partnerships, adopting or amending redevelopment plans and other activities. The court announced that it will hear the lawsuit as early as possible in 2011 and that it will issue an opinion prior to January 15, 2012.

Tune in to the next Tax Credit Tuesday podcast to hear more about the case and what it could mean for state redevelopment agencies.

IRS SUSPENDS SOME REQUIREMENTS FOR ALABAMA LIHTC PROPERTIES

WASHINGTON, D.C. - August 5, 2011

The Internal Revenue Service (IRS) today issued Notice 2011-65 to suspend certain requirements under Section 42, allowing low-income housing tax credit (LIHTC) properties in Alabama to provide emergency housing relief for residents displaced by severe storms, tornadoes, straight-line winds and flooding that began on April 15. The IRS said it will temporarily suspend income limitations for LIHTC properties that have received approval from the Alabama Housing Finance Authority to rent vacant units to displaced individuals. Other rules and requirements of Section 42 will continue to apply during the temporary housing period.

IRS RELEASES GUIDANCE ON WHEN BONDS ARE CONSIDERED ISSUED

WASHINGTON, D.C. - August 3, 2011

The Internal Revenue Service (IRS) today issued guidance on the determination of when state and local bonds are considered “issued” for purposes of volume cap limitations on private activity bonds. Notice 2011-63 provides information on the bond issuances for purposes of volume cap allocations, examples illustrating the issuance requirements and instructions on reporting information to the IRS. Notice 2011-63 amends Notice 2010-81. Tune in to the Tax Credit Tuesday podcast on August 9 to learn more about the new guidance.

July

IT'S NOT TOO LATE - SIGN ON TO SUPPORT THE LIHTC TODAY

WASHINGTON, D.C. - July 27, 2011

Nearly 400 affordable housing supporters have signed on to the Affordable Housing Tax Credit Coalition's (AHTCC's) rebuttal of a proposal to eliminate the low-income housing tax credit (LIHTC), proposed last week by Sen. Tom Coburn, R-Okla.

There is still time for LIHTC supporters to co-sign the rebuttal document; groups interested in adding their names to the rebuttal should contact AHTCC Executive Director Victoria Spielman at victoria.spielman@taxcreditcoalition.org today, Wednesday, July 27, to ensure their inclusion.

AFFORDABLE HOUSING COMMUNITY UNITES TO DEFEND LIHTC

WASHINGTON, D.C. - July 25, 2011

Approximately 200 organizations have signed on to the Affordable Housing Tax Credit Coalition’s (AHTCC’s) rebuttal of Sen. Tom Coburn's proposal to eliminate the low-income housing tax credit (LIHTC). The LIHTC was one of a number of tax expenditures targeted for elimination in Sen. Coburn's deficit reduction plan entitled "Back in Black." The AHTCC warns that repealing the LIHTC would deprive millions of low-income families and seniors of a decent place to live and would eliminate thousands of jobs. In its rebuttal, the group notes that the proposal's discussion of reasons to eliminate the LIHTC is based on faulty reasoning, irrelevant information and inaccurate or unsupported claims.

There is still time for affordable housing advocates and LIHTC supporters to sign on to the rebuttal document; groups interested in co-signing the rebuttal should contact AHTCC Executive Director Victoria Spielman at victoria.spielman@taxcreditcoalition.org by Wednesday, July 27.

AHTCC REFUTES SEN. COBURN'S CRITICISM OF THE LIHTC

WASHINGTON, D.C. - July 21, 2011

The Affordable Housing Tax Credit Coalition (AHTCC) today sent a rebuttal of Sen. Tom Coburn's proposal to eliminate the low-income housing credit (LIHTC) to lawmakers. The LIHTC was one of a number of tax expenditures targeted for elimination in Sen. Coburn’s deficit reduction plan entitled "Back in Black." The AHTCC warns that repealing the LIHTC would deprive millions of low-income families and seniors of a decent place to live and would eliminate thousands of jobs. In its rebuttal, the group notes that the proposal’s discussion of reasons to eliminate the LIHTC is based on faulty reasoning, irrelevant information and inaccurate or unsupported claims.

The AHTCC invites affordable housing advocates and LIHTC supporters to sign on to the rebuttal document; groups interested in co-signing the rebuttal should contact AHTCC Executive Director Victoria Spielman at victoria.spielman@taxcreditcoalition.org by Wednesday, July 27.   

SEN. COBURN PROPOSES ELIMINATING LIHTC, NMTC, HTC AND RETCs

WASHINGTON, D.C. - July 19, 2011

Sen. Tom Coburn, R-Okla., yesterday released the proposal “Back in Black: A Deficit Reduction Plan,” his outline for the federal government to reduce the deficit by $9 trillion over the next 10 years. The 614-page plan calls for the elimination of nearly $1 trillion in tax expenditures in a section entitled “Reforming Tax Expenditures & Ending Special Giveaways.” Among other tax incentives, the proposal would eliminate the low-income housing tax credit (LIHTC), new markets tax credit (NMTC), historic preservation tax credit (HTC) and renewable energy tax credits (RETCs). 

Tune in to today’s Tax Credit Tuesday podcast to hear Michael J. Novogradac, CPA, discuss this proposal and its prospects within the context of the ongoing debt ceiling and deficit reduction talks in Washington, D.C.

IRS SUSPENDS REQUIREMENTS FOR CERTAIN NORTH DAKOTA LIHTC PROPERTIES

WASHINGTON, D.C. - July 14, 2011

The Internal Revenue Service (IRS) today issued Notice 2011-60 to grant certain low-income housing tax credit (LIHTC) properties relief from specified Section 42 requirements in the wake devastation caused by flooding in North Dakota beginning on February 14, 2011. The IRS said it will temporarily suspend income limitation and non-transient requirements for LIHTC properties that have received approval from the North Dakota Housing Finance Agency to rent vacant units to individuals displaced by natural disasters. Other rules and requirements of Section 42 will continue to apply during the temporary housing period.

IRS REQUESTS COMMENTS ON INDIANA LIHTC REQUIREMENTS

WASHINGTON, D.C. - July 8, 2011

The Internal Revenue Service (IRS) today issued a request for comments concerning Notice 2008-56, which suspended certain low-income housing tax credit (LIHTC) requirements because of severe storms and flooding in Indiana. The IRS will accept comments on the notice until September 6, 2011. Notice 2008-56 and today’s request for comments can be found on the IRS Guidance page.

CALIF. BUDGET ELIMINATES REDEVELOPMENT AGENCIES

WASHINGTON, D.C. - July 6, 2011

The California Tax Credit Allocation Committee (TCAC) is encouraging developers applying for low-income housing tax credit funding to consider if financing agreements from redevelopment agencies (RDAs) will be enforceable at the time of development. TCAC issued the instructions because two budget trailer bills signed by the governor, ABx1 26 and ABx1 27, will effectively eliminate RDAs on October 1, 2011. The budget trailer bills, also known as the Redevelopment Restructuring Acts, suspend new redevelopment activities as of June 29, 2011 and dissolve RDAs on October 1, 2011, unless the RDAs make specified contributions to local school and special districts. TCAC assumes that RDAs will be eliminated October 1 and that only RDA obligations existing prior to June 29, 2011 will be enforceable. Guidance from TCAC, as well as legislation updates, will be posted to the Affordable Housing Resource Center as they become available.

IRS SOLICITS COMMENTS ON FORM 8823

WASHINGTON, D.C. - July 6, 2011

The Internal Revenue Service (IRS) today requested comments on Form 8823, Low-Income Housing Credit Agencies Report of Noncompliance or Building Disposition. No revisions were made to the form; however, the IRS said it adjusted the burden computation to accurately reflect the total burden hours associated with the data collection. The IRS uses Form 8823 to determine whether the low-income housing tax credit is being correctly claimed and whether there is any credit recapture. Written comments on the proposed information collection must be received by September 6.

June

HUD REVISES INCOME LIMITS FOR SELECTED AREAS

WASHINGTON, D.C. - June 30, 2011

The U.S. Department of Housing and Urban Development (HUD) today released revised fiscal year (FY) 2011 income limits for certain areas. The affected areas are located in California, Colorado, Florida, Massachusetts, New York and Puerto Rico.

Tune in to the July 5 Tax Credit Tuesday podcast to hear Michael J. Novogradac, CPA, give a detailed analysis of the income limit revisions and what they mean for your property.

SENATORS INTRODUCE INCREASE OF LIHTCS FOR DISASTER AREAS

WASHINGTON, D.C. - June 16, 2011

Senators from states that suffered from damage caused by spring tornados and flooding  yesterday introduced the Southeastern Disaster Tax Relief Act of 2011 (S. 1205). S. 1205 would, among other things, increase to $8 per person per year the amount of low-income housing tax credits (LIHTCs) allocated to Alabama, Arkansas, Georgia, Kentucky, Mississippi, Missouri, North Carolina, Oklahoma and Tennessee through 2013. S. 1205 would also increase the states’ amount of tax-exempt bond authority available for affordable rental housing. The text of the Southeastern Disaster Tax Relief Act and a summary of its provisions can be found at the Affordable Housing Resource Center.

IRS SUSPENDS REQUIREMENTS FOR CERTAIN MISSOURI LIHTC PROPERTIES

WASHINGTON, D.C. - June 15, 2011

The Internal Revenue Service (IRS) today issued Notice 2011-47 to grant certain low-income housing tax credit (LIHTC) properties relief from specified Section 42 requirements in the wake of the devastation in Missouri caused by severe storms, tornadoes and flooding beginning on April 19. The IRS said it will temporarily suspend income limitation and non-transient requirements for LIHTC properties that have received approval from the Missouri Housing Development Commission to rent vacant units to individuals displaced by natural disasters. Other rules and requirements of Section 42 will continue to apply during the temporary housing period.

NOVOGRADAC'S RENT & INCOME CALCULATOR UPDATED FOR 2011

SAN FRANCISCO - June 4, 2011

Novogradac & Company LLP is pleased to announce that the Rent & Income Limit Calculator© has been updated to include the U.S. Department of Housing and Urban Development's (HUD) 2011 rent and income limit data. The Rent & Income Limit Calculator© will calculate IRC 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. A Beta version is available online at www.novoco.com/products/rentincome.php with the compliments of Novogradac & Company LLP.

We encourage and welcome your comments on this Beta version of the Rent & Income Calculator© at jim.kroger@novoco.com. A final version of the calculator will be launched after the 2011 Rent & Income Limits Webinar on Friday, June 10.

To learn what the 2011 rent and income limits mean for your property, register for Novogradac & Company's 2011 Rent & Income Limits Webinar.

If you would like to engage Novogradac & Company LLP to calculate the rent and income limits for your property, please contact Jim Kroger at jim.kroger@novoco.com.

BILL WOULD HELP MILITARY FAMILIES QUALIFY FOR LIHTC UNITS

WASHINGTON, D.C. - June 3, 2011

Rep. Bill Owens yesterday introduced The Military Families Affordable Homes Act (H.R. 2097). H.R. 2097 would allow service members to exclude their basic allowance for housing (BAH) from their income when applying for low-income housing tax credit (LIHTC) housing. At most military bases, military personnel must include both their annual pay and BAH in their income when they apply for housing. The Military Families Affordable Homes Act would expand an exception to the requirement that Congress passed for several military bases affected by Base Realignment and Closure activities. Text of the bill will be posted to the Affordable Housing Resource Center when it becomes available.

HUD CORRECTS NEW YORK METRO AREA INCOME LIMITS

WASHINGTON, D.C. - June 1, 2011

The U.S. Department of Housing and Urban Development (HUD) today issued corrected fiscal year (FY) 2011 income limit values for the New York, N.Y. HUD Metro Fair Market Rent Area. Following yesterday’s publication of FY 2011 income limits for areas nationwide, the agency said it identified an inconsistency in the values for the New York metro area, which includes Bronx County, Kings County, New York County, Putnam County, Queens County and Richmond County. HUD said it has updated all information contained on its web site to reflect the correct values.

May

HUD RELEASES INCOME LIMITS FOR 2011

WASHINGTON, D.C. - May 31, 2011

The U.S. Department of Housing and Urban Development (HUD) today released income limits for 2011. Click here for links to the 2011 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.

Novogradac & Company LLP is currently updating its Rent & Income Limit Calculator© to include 2011 data. Subscribers to Novogradac & Company’s free Industry Alert E-mail service will receive an e-mail announcement when the update has been completed.

To learn what the 2011 rent and income limits mean for your property, tune in to Novogradac & Company's upcoming webinar. Stay tuned to www.novoco.com/events for details about this event.

In the meantime, for questions about the new 2011 income limits please email Jim Kroger, CPA, at jim.kroger@novoco.com or click here to learn more about Novogradac & Company’s property compliance services.

 
April

RENTAL HOUSING REPORT FINDS RECORD-HIGH UNAFFORDABILITY

CAMBRIDGE, Mass. - April 26, 2011

A record number of renters are paying more than half their income for housing, according to a report released today by the Harvard Joint Center for Housing Studies (JCHS). “America’s Rental Housing: Meeting Challenges, Building on Opportunities” found that one in four renters, or 10.1 million households, spend more than half their income on rent and utilities. JCHS attributed the record-high levels to the recession, which worsened budgets already strained by rising utility costs and declining incomes. The report also determined that while affordable housing demand is stronger than ever, the supply is shrinking. JCHS said that rental housing policy, in addition to alleviating renters’ economic burden, may help address poverty and communities hit hard by the foreclosure crisis.

ADMINISTRATION COMMITS TO SUPPORT GO ZONE EXTENSION

WASHINGTON, D.C. - April 8, 2011

The Secretaries of the U.S. Department of Housing and Urban Development (HUD) and the Treasury Department in a letter this week expressed their commitment to work with Congress to enact a one-year extension of the placed-in-service deadline for Gulf Opportunity (GO) Zone low-income housing tax credit (LIHTC) properties. The letter, which was sent in response to correspondence the agencies received from Sen. Mary Landrieu in March, states that the credits are critical to Gulf Coast rebuilding efforts and that failing to extend the program “would result in a major setback for the recovery.” A one-year extension would move the placed-in-service date for GO Zone properties to January 1, 2013.

Join Novogradac & Company in the heart of the Gulf Coast for the conference, “Affordable Housing: A Catalyst for Economic Growth,” May 19-20 in New Orleans.

March

LANDRIEU INTRODUCES GO ZONE LIHTC PIS DATE EXTENSION

WASHINGTON, D.C. - March 31, 2011

Sen. Mary Landrieu, D-La., introduced on March 29 an amendment to S. 493 that would extend the placed in service date for low-income housing tax credit (LIHTC) properties in the Gulf Opportunity (GO) Zones. S.Amdt. 258 would extend the placed in service date for LIHTC properties until January 1, 2013. Sens. David Vitter, R-La., William Thad Cochran, R-Miss., and Richard Shelby, R-Ala., cosponsored the amendment.

Hear firsthand about the latest LIHTC developments in the GO Zone by attending Novogradac & Company’s Affordable Housing: A Catalyst for Economic Growth, May 19-20, in New Orleans.

NEW YORK PASSES BUDGET, EXTENDS LIHTC

Albany, N.Y. - March 31, 2011

The New York Legislature and Gov. Andrew Cuomo passed a 2011-2012 state budget early this morning. The $132.5 billion budget includes several tax credit provisions. Among other things, New York’s budget bill extends the low-income housing tax credit by $4 million in aggregate credit awards, raising the total amount of credits to be awarded to $40 million.

To learn more about affordable housing issues affecting New York, register for the New York State Association for Affordable Housing's (NYSAFAH's) 12th Annual New York State Affordable Housing Conference on May 12.

IRS RELEASES UPDATED 8823 GUIDE

WASHINGTON, D.C. - March 25, 2011

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 guide 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, May 19-20 in New Orleans. It’s not too late to attend!

Don’t want to wait until May? Contact Jim Kroger at 415-356-8016 or jim.kroger@novoco.com with your questions about the new guide.

OCC REQUESTS COMMENTS ON CRA REGULATIONS

WASHINGTON, D.C. - March 23, 2011

The Office of the Comptroller of the Currency (OCC)  invited public comments on its information collection related to the Community Reinvestment Act (CRA). The CRA requires the federal banking agencies to assess the record of banks and savings associations in helping to meet the credit needs of their entire communities, including low- and moderate-income neighborhoods, consistent with safe and sound operations. Each agency must provide written CRA evaluations of the institutions they supervise. In today’s notice, the OCC says the data collection requirements in the CRA regulations are necessary for the agencies to examine, assess and assign a rating to an institution’s CRA performance and to prepare the public section of the written CRA performance evaluation.  The OCC will accept comments until May 23, 2011.

BILL INTRODUCED TO EXTEND LIHTC EXCHANGE PROGRAM

WASHINGTON, D.C. - March 11, 2011

Ways & Means Committee Democrats introduced a bill yesterday that would extend the Section 1602 low-income housing tax credit exchange program through 2011. In addition, H.R. 992, the Building American Jobs Act of 2011 would, among other things, extend the Build America Bonds program through 2012, allocate additional Recovery Zone bonds, exempt private activity bonds from the alternative minimum tax (AMT), allow new markets tax credits to be claimed against the AMT and extend Federal Home Loan Banks’ ability to guarantee tax-exempt bonds through 2011. The bill was referred to the House Committee on Ways and Means. Twenty-two organizations sent a letter to the Ways & Means Committee Democrats in support of the legislation.

HUD REQUESTS COMMENTS ON FAIR MARKET RENT METHODOLOGY

WASHINGTON, D.C. - March 9, 2011

The U.S. Department of Housing and Urban Development (HUD) today requested comments about the manner in which it calculates the trend factor used in its fair market rent (FMR) estimates. FMRs are required to be ‘‘trended so the rentals will be current for the year to which they apply.’’ In the Federal Register notice, HUD proposes several alternative methods for calculating the trend factor and requests comments on the alternatives as well as other suggestions. HUD will accept public comments until April 8, 2011.

IRS RELEASES 2011 CALENDAR YEAR RESIDENT POPULATION ESTIMATES

WASHINGTON, D.C. - March 4, 2011

The Internal Revenue Service (IRS) today released its 2011 Calendar Year Resident Population Estimates. These figures are used to determine states' low-income housing tax credit (LIHTC) ceilings and tax-exempt private activity bond caps in 2011. Each state's LIHTC ceiling in 2011 is equal to the greater of $2.15 multiplied by the state population or $2,465,000; a state's tax-exempt bond volume cap will be the greater of $95 multiplied by the state population or $277,820,000. Notice 2011-15 includes the population estimates for each state, territory and insular area.

Tune in to the Tax Credit Tuesday Podcast on March 8 to hear Michael J. Novogradac, CPA, discuss which states’ populations increased, which declined, and what it all means for LIHTC practitioners.

IRS SOLICITS COMMENTS ON LIHTC ALLOCATION AND CERTIFICATION FORMS

WASHINGTON, D.C. - March 4, 2011

The Internal Revenue Service (IRS) today invited comments concerning Form 8609 and 8609-A for low-income housing tax credit (LIHTC) allocation and certification. No changes have been made to Form 8609; the  instructions for Form 8609 were updated in December of 2010 and those updates changed the reporting burden. Written comments are due on or by May 3.

FLORIDA HOUSING ANALYZES LIHTC DEVELOPMENT AND JOB CREATION

TALLAHASSEE, Fla. - March 3, 2011

Florida Housing Finance Corporation (FHFC) has released a white paper about the number of jobs created by the construction and preservation of low-income housing tax credit (LIHTC) properties. The white paper examines whether constructing new LIHTC developments or preserving existing developments creates more jobs. FHFC found that new construction creates, on average, 347 jobs per property whereas each preservation project creates 215 jobs. When considering the amount of tax credits needed for a project, the study also found that FHFC can fund an estimated 22 preservation developments to create 4,737 jobs versus an estimated 12 new construction developments, which create 4,164 jobs. The final paper also includes comments from stakeholders about the benefits and risks of LIHTC property preservation versus new construction.

 
 
February

 

LOUISIANA HFA OFFERS ADDITIONAL TCAP ALLOCATIONS

BATON ROUGE, La. - February 17, 2011

The Louisiana Housing Finance Agency (LHFA) today released a memo describing how it will award its remaining Tax Credit Assistance Program (TCAP) funds. Properties that have achieved prior environmental clearance can apply for up to $1.5 million in TCAP funds. LHFA will award points to properties based on the amount of TCAP money that they have already expended and the amount of funding that they are requesting. LHFA will accept applications until 4:30 p.m. February 25. Staff will post preliminary rankings no later than 4:30 p.m. March 7 and LHFA’s Board of Commissioners will approve the staff-submitted properties on March 16. More information about the submission procedures can be found in LHFA’s memo.

FLA. HOUSING REQUESTS COMMENTS ON JOBS CREATED BY LIHTC DEVELOPMENTS

TALLAHASSEE, Fla. - February 15, 2011

Florida Housing Finance Corporation (FHFC) is requesting comments on a draft of a white paper that examines the jobs created by low-income housing tax credit (LIHTC) developments. The white paper examines whether constructing new LIHTC developments or preserving existing developments creates more jobs. FHFC found that new construction creates, on average, 340 jobs per property whereas each preservation project creates 217 jobs. When considering the amount of tax credits needed for a project, the study also found that FHFC can fund an estimated 22 preservation developments to create 4,772 jobs versus an estimated 12 new construction developments, which create 4,079 jobs. FHFC will accept comments on the draft until 5 p.m. February 17 and anticipates releasing the final version of the white paper at the end of this week.

IRS ISSUES GUIDANCE ON TAXABILITY OF TCAP GRANTS

WASHINGTON, D.C. - February 14, 2011

Tax Credit Assistance Program (TCAP) grants are includable in the gross income of taxpayers that are awarded the funds by a state housing authority, according to the Internal Revenue Service in CCA 201106008. The guidance also discusses whether the grant funds are includible in the taxable year the grant is awarded or the taxable year the grant was received.

Tune in to tomorrow's Tax Credit Tuesday podcast to hear Michael J. Novogradac, CPA, discuss what this ruling means for TCAP grant recipients as well as parallels for developments funded with cash grant exchange program funds.

ADMINISTRATION RELEASES HOUSING FINANCE REFORM PROPOSAL

WASHINGTON, D.C. - February 11, 2011

The Obama Administration today delivered a report to Congress proposing a plan to reform the housing finance market. The proposal would gradually reduce Fannie Mae and Freddie Mac’s role in the market and ultimately wind down both institutions, which the administration says would create the conditions for private capital to play the predominant role in housing finance. The report also stresses a commitment to affordable rental housing and calls for a dedicated funding source for affordability efforts. Additional information is available on the GSE Reform page.

Tune in to the February 15 Tax Credit Tuesday podcast to hear more about the plan and what it means for the affordable housing community. More information on the subject can also be found in this month’s Journal of Tax Credits.

NEW YORK GOVERNOR PROPOSES HOUSING BUDGET CUTS

ALBANY, N.Y. - February 3, 2011

New York Gov. Andrew Cuomo yesterday revealed his 2011-2012 Executive Budget, a plan that he says will eliminate a $10 billion deficit without tax increases or borrowing. The proposed budget’s highlights include $307.8 million for the Division of Housing and Community Renewal, a figure that represents a nearly $157 million reduction from last year’s budget; Cuomo said the decrease in part reflects the expiration of one-time American Recovery and Reinvestment Act funds and various program reductions. Funding for the state low-income housing tax credit program will remain at $4 million under the proposal. The budget also recommended consolidating the Neighborhood and Rural Preservation programs into a single program and cutting the programs’ funding by half.

FHFA RESTRUCTURES SAFETY AND SOUNDNESS AND MISSION OFFICES

WASHINGTON, D.C. - February 2, 2011

Federal Housing Finance Administration (FHFA) Acting Director Edward J. DeMarco has announced a restructuring of the agency’s safety and soundness and mission offices, including the establishment of an integrated supervision structure and a revamped housing mission and policy division. The new housing mission team will focus on policy matters involving the government sponsored enterprise (GSE) conservatorships, including loss mitigation activities, public reporting on the activities of FHFA’s regulated entities, affordable housing and Dodd-Frank-related activities. FHFA plans to have the new structure, designed to promote greater uniformity and consistency in the examinations of Fannie Mae, Freddie Mac and the Federal Home Loan Banks, in place by the end of the first quarter. More information about the revamped housing mission and the staffing of the examination offices, including a supervision committee organizational chart, can be found in the FHFA’s announcement.

CALIF. HCD CANCELS OPEN NOFAs FOR PROPOSITION 46 & 1C

WASHINGTON, D.C. - February 2, 2011

The California Department of Housing and Community Development (HCD) has cancelled all open and unawarded notices of funding availability (NOFAs) for Proposition 46 and 1C until further notice. The HCD says the move is a result of Gov. Jerry Brown’s proposed state budget, which would freeze general obligation bond-funded programs. Additionally, the HCD will not offer any new NOFAs for the following programs until further notice: Multifamily Housing Program; Multifamily Housing Program Supportive Housing Component; Homeless Youth; Governor’s Homeless Initiative; CalHome Development Project Loan; and Housing Related Parks. HCD says that properties that have already received awards will not be affected by the freeze.

BILL WOULD EXTEND GO ZONE PLACED-IN-SERVICE DATE

WASHINGTON, D.C. - February 2, 2011

Sen. Mary Landrieu, D-La., on January 25 introduced a bill to extend by one year the placed-in-service date for low-income housing tax credit rules applicable to Gulf Opportunity (GO) Zone properties. S. 30 would allow GO Zone properties to be placed in service until January 1, 2013. The bill was read twice and referred to the Senate Committee on Finance. Sens. Max Baucus, D-Mont., Thad Cochran, R-Miss., Richard Shelby, R-Ala., David Vitter, R-La., and Roger Wicker, R-Miss., co-sponsored the bill.

ARIZONA DOH RELEASES UTILITY ALLOWANCE GUIDELINES

PHOENIX, Ariz. – February 1, 2011

The Arizona Department of Housing (ADOH) yesterday issued its final utility allowance guidelines for low-income housing tax credit (LIHTC) properties. To maintain compliance, LIHTC properties must demonstrate that the utility allowance charged for a rent‐restricted unit complies with one of the methods described in the regulations. The guidelines, which are effective immediately, can be found on ADOH’s web site or at the Affordable Housing Resource Center.

January

GEORGIA TAKING APPLICATIONS FOR ADDITIONAL TCAP FUNDS

ATLANTA, Ga. – January 31, 2011

The Georgia Department of Community Affairs (DCA) is accepting requests for additional funds from the Tax Credit Assistance Program (TCAP). Properties that received a low-income housing tax credit allocation between October 1, 2006 and September 30, 2009 may be eligible for an award of up to $2 million. The DCA will allocate the TCAP funds to one property. Interested parties must submit the amount of TCAP recaptured funds being requested; a description of how the funds will be used and why they are needed; and the “Detailed Sources & Uses” section of the Core Application for the proposed development. The DCA has released detailed information for applicants and interested parties should email their information to Andria Williams at andria.williams@dca.ga.gov no later than 5 p.m. on Wednesday, February 2. More information about the reallocation of TCAP funds can be found at the Affordable Housing Resource Center.

HUD COMMISSIONS ASSESSMENT OF LIHTC PROGRAM

WASHINGTON, D.C. – January 27, 2011

The U.S. Department of Housing and Urban Development (HUD) announced in today’s Federal Register that it will commission a study of the low-income housing tax credit program. HUD says the study, “An Assessment of the LIHTC Program after 15 Years,” will determine whether properties that reach the 15 year mark are remaining affordable, what types of properties are or are not remaining affordable, and what major factors contribute to these outcomes. HUD will accept comments regarding the proposal until February 28, 2011. Documents related to the study will be posted to the Affordable Housing Resource Center as they become available. Information about HUD's research design and data collection plan for the assessment can be found on the LIHTC Hot Topic page.

BILL WOULD LIMIT TAX CREDIT USERS CAMPAIGN CONTRIBUTIONS

JEFFERSON CITY, Mo. – January 21, 2011

Mo. State Senator Jason Crowell, R-Cape Girardeau, introduced S.B. 141 on Wednesday. The bill would prohibit anyone who has made a campaign contribution in the past two years from applying for state credits. The bill would also prohibit tax credit recipients from making campaign contribution for two years after they receive the state tax credits. Violation of the campaign contribution restrictions would result in recapture of the state tax credits. The act would apply to more than two dozen existing state tax credit programs, including the state historic tax credit, low-income housing tax credit, new markets tax credit, distressed areas land assemblage tax credit and brownfield redevelopment tax credit. Crowell also introduced several other tax credit related bills on Wednesday, including S.B. 139, which would subject all state tax credits to appropriation; S.B. 142, which would remove statewide elected officials from the Missouri Development Finance Board and the Missouri Housing Development Commission; and S.B. 144, which would place a one-year moratorium on the issuance of low-income housing and Missouri development finance board infrastructure development fund contribution tax credits. If passed, all of the bills would have an August 28, 2011 effective date, except for S.B. 144, which would be effective as soon as it was passed.

GOVERNOR PROPOSES ELIMINATING REDEVELOPMENT AGENCIES IN CALIF.

SACRAMENTO, Calif. – January 10, 2011

Governor Jerry Brown today submitted his proposed budget for 2011‑12 to the California Legislature. The proposed budget would make significant changes to economic development activities in California, including eliminating redevelopment agencies by July 1. Gov. Brown proposes that the state constitution be amended to provide for 55 percent voter approval for tax increases and bonding against local revenues for development projects such as are currently done by redevelopment agencies.