Low-Income Housing Tax Credits:

News Archive

2005


December

Washington, D.C. - December 29, 2005

The U.S. Department of Housing and Urban Development (HUD) today published a final rule establishing the requirement for applicants for HUD grants or certain other financial assistance to submit their applications electronically. This final rule follows publication of a proposed rule on November 23, 2004. HUD says the electronic application process should standardize, simplify and improve the integrity of HUD's grant-making process and result in saving time and resources for the applicant in preparing, mailing and delivering paper copies of applications. Click here for more information.

Washington, D.C. - December 28, 2005

The Federal Housing Finance Board today published a set of proposed amendments to its Affordable Housing Program (AHP) regulation to remove prescriptive requirements, clarify certain operational requirements, remove certain authorities and otherwise streamline and reorganize the regulation. Some of the proposed amendments concern affordable housing developments funded under AHP and the low-income housing tax credit (LIHTC) program. Written comments on the proposed rule must be received on or before April 27, 2006. Click here for more information.

Washington, D.C. - December 21, 2005

President George W. Bush today signed H.R. 4440, a package of tax incentives to aid recovery in the Gulf Coast region. The measure, passed last week by Congress, creates Gulf Opportunity Zones (GO Zones) and increases low-income housing tax credit (LIHTC) allocating authority for 2006, 2007 and 2008 in the amount of the lesser of the aggregate amount allocated by the state allocating agency to buildings located in GO Zones or $18 multiplied by the population located in designated GO Zones under the most recent census. H.R. 4440 also provides that GO Zones will treated as difficult development areas (DDAs) but will not count toward the 20 percent nationwide cap on designated DDAs.

Washington, D.C. - December 16, 2005

The Senate by a voice vote passed H.R. 4440, a package of tax incentives to aid recovery in the Gulf Coast region. The amended measure reconciles separate tax proposals developed by the House and Senate. H.R.4440 creates Gulf Opportunity Zones (GO Zones) and increases low-income housing tax credit (LIHTC) allocating authority for 2006, 2007 and 2008 in the amount of the lesser of the aggregate amount allocated by the state allocating agency to buildings located in GO Zones or $18 multiplied by the population located in designated GO Zones under the most recent census. H.R. 4440 also provides that GO Zones will treated as difficult development areas (DDAs) but will not count towards the 20 percent nationwide cap on designated DDAs.

The Affordable Housing Tax Credit Coalition (AHTCC) reports that the House is expected to pass the bill quickly and send it to the President for signature before the congressional holiday recess.

Washington, D.C. - December 15, 2005

The House Committee on Financial Services Subcommittee on Housing and and Community Opportunity yesterday held a hearing entitled "Housing Options in the Aftermath of Hurricanes Katrina and Rita,” during which it heard testimony from Brian D. Montgomery, Assistant Secretary for Housing/Federal Housing Commissioner for the U.S. Department of Housing and Urban Development (HUD) and HUD Assistant Secretary for Public and Indian Housing Orlando J. Cabrera. Montgomery and Cabrera spoke to HUD’s efforts in response to the housing needs created by the hurricanes. A similar hearing was held last week, featuring testimony from David E. Garratt, acting director of the recovery division of the Federal Emergency Management Agency (FEMA), to examine FEMA’s housing efforts in the aftermath of the hurricanes.

Washington, D.C. - December 9, 2005

This week the House of Representatives passed H.R. 4440, the Gulf Opportunity Zone Act of 2005, by a vote of 415-4. The measure, intended to help in the Gulf Coast recovery efforts, contains a provision to increase low-income housing tax credit (LIHTC) authority for 2006, 2007 and 2008 in Gulf Opportunity (GO) Zones. GO Zones would also be treated as difficult development areas (DDA) and would not count towards the 20 percent nationwide cap on designated DDAs. Click here for a copy of H.R. 4440.

Sacramento, Calif. - December 6, 2005

The applicability of state prevailing wage requirements to low-income housing tax credit (LIHTC) projects has caused a great deal of uncertainty among applicants for LIHTCs in California during 2005. To ease some of that uncertainty, the California Tax Credit Allocation Committee (TCAC) yesterday published a memo providing additional guidance regarding prevailing wage estimates included in eligible basis. Click here for a copy of the memo.

Raleigh, N.C. - December 5, 2005

The North Carolina Housing Finance Agency (NCHFA) today released the qualified allocation plan (QAP) for the low-income housing tax credit (LIHTC) program and application for 2006. Click here for links to draft and/or final QAPs that are currently available from state agencies.

Washington, D.C. - December 1, 2005

The U.S. Department of Housing and Urban Development (HUD) today announced 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.

November

Washington, D.C. - November 29, 2005

The U.S. Department of Housing and Urban Development (HUD) today notified the public of funding awards to public housing agencies (PHAs) for the Section 8 housing choice voucher program for fiscal year (FY) 2005. A total of $202,680,883 in budget authority for 26,540 housing choice vouchers was awarded to PHAs for housing conversion actions, public housing relocations and replacements, moderate rehabilitation replacements and HOPE VI voucher awards. Click here for details.

Austin, Texas - November 22, 2005

The Texas Department of Housing and Community Affairs (TDHCA) today announced the release of the 2006 multifamily application and related materials for the low-income housing tax credit (LIHTC) program, as well as the final 2006 qualified allocation plan (QAP) signed by Gov. Rick Perry last week. Click here to download a copy of the QAP and related materials.

Washington D.C.- November 21, 2005

The House of Representatives and the Senate on Friday gave final approval for an appropriations measure for the U.S. Department of Housing and Urban Development (HUD) as part of H.R. 3058, a larger appropriations bill for the Departments of Transportation, Treasury and several other agencies. The bill includes $38.2 billion for HUD, $900 million above last year's level and $9.7 billion more than President Bush’s request. The legislation has been sent to the president for his signature. H.R. 3058 and the conference report, H. Rept. 109-307, can be found online at the Library of Congress web site.

Washington D.C.- November 8, 2005

The Senate Finance Committee today released the chairman’s mark of the “Tax Relief Act of 2005.” Under the proposal, the otherwise applicable low-income housing tax credit (LIHTC) ceiling amount is increased for each of the states within the Gulf Opportunity Zone (Alabama, Louisiana and Mississippi) for calendar years 2006, 2007, 2008 and 2009. The additional LIHTC cap for each of the affected states would equal three times the otherwise applicable credit cap amount (e.g., $1.90 for 2006) for the year times the number of such state’s residents within the Gulf Opportunity Zone. Click here for a copy of the chairman’s mark of the Tax Relief Act of 2005 and additional details about the LIHTC proposal.

Washington D.C.- November 7, 2005

The Internal Revenue Service today published a notice containing regulations that reduce the burden for taxpayers filing Form 8609, “Low-Income Housing Credit Allocation and Certification.” The new regulations, which are effective as of today, allow owners of low-income housing tax credit (LIHTC) projects who claim the credit to file Form 8609 only once, instead of filing the form with the same information for the 15 consecutive years of the LIHTC compliance period. Click here for more information.

October

Washington D.C.- October 31, 2005

The Internal Revenue Service (IRS) announced in Revenue Procedure 2005-70 the inflation-adjusted low-income housing tax credit (LIHTC) and private activity bond caps for 2006. For calendar years beginning in 2005, the amount used under §42(h)(3)(C)(ii) to calculate the state LIHTC ceiling is the greater of $1.90 multiplied by the state population or $2,190,000. The amount used under §146(d)(1) to calculate the state ceiling for the volume cap for private activity bonds in 2006 is the greater of $80 multiplied by the state population or $246,610,000. Click here to view Rev. Proc. 2005-70.

Washington D.C.- October 27, 2005

The Arkansas Development Finance Authority (ADFA) today announced that it increased the per unit cost cap for housing applications receiving low-income housing tax credit (LIHTC) reservations in 2004, 2005 and 2006. As a result of the increase in construction costs due to the recent disasters caused by Hurricanes Katrina and Rita, ADFA’s Board Housing Review Committee instituted the following per unit cap cost increases for those developments receiving LIHTC reservations in: 2004 - $108,000 per unit; 2005 - $120,000 per unit OR $144,000 per unit if an assisted living development or a certified historic structure rehabilitation/preservation development; 2006 - $132,000 per unit OR $158,400 per unit if an assisted living development or a certified historic structure rehabilitation/preservation development.

Washington D.C.- October 26, 2005

Sens. John Ensign, R-Nev., John Kerry, D-Mass., Rick Santorum, R-Pa., and Debbie Stabenow, D-Mich., today sent a ‘Dear Colleague’ letter to Senate Finance Committee Chairman Charles Grassley, R-Iowa, and Ranking Member Max Baucus, D-Mont., in support of including a modified version of the Community Development Homeownership Tax Credit Act, as proposed in S. 859, in the tax package being developed to help rebuild the Gulf Coast.

Washington D.C.- October 25, 2005

The Internal Revenue Service (IRS) Tax Exempt and Government Entities (TE/GE) division is requesting applications for membership to serve on the Advisory Committee on Tax Exempt and Government Entities (ACT). The committee is an organized public forum for discussion of relevant employee plans, exempt organizations, tax-exempt bonds, and federal, state, local and Indian tribal government issues between officials of the IRS and representatives of those communities. Applications will be accepted for several vacancies which will occur in May 2006. Written applications or nominations must be received on or before November 25, 2005. Click here for more information.

Washington D.C.- October 21, 2005

The U.S. Department of Housing and Urban Development today published operating cost adjustment factors (OCAFs) for Section 8 rent adjustments at contract renewal for fiscal year 2006. OCAFs are used to calculate rent adjustments under section 524 of the Multifamily Assisted Housing Reform and Affordability Act of 1997, as amended by the Preserving Affordable Housing for Senior Citizens and Families into the 21st Century Act of 1999, and under the Low-Income Housing Preservation and Resident Homeownership Act of 1990. For more information, click here.

Sacramento, CA- October 18, 2005

The California Tax Credit Allocation Committee (TCAC) has released a proposed schedule for this year's Qualified Application Plan (QAP) update, regulation review and revisions. The updated schedule includes proposed 2006 dates for 9% LIHTC application submittals and Committee meeting dates. Any changes to the current regulatory scheme are expected to be minimal. Click here for a copy of the proposed 2006 program.

Washington, D.C. - October 13, 2005

The U.S. Department of Housing and Urban Development (HUD) today published a final rule implementing a comprehensive new project-based voucher program that replaces the current project-based certificate (PBC) regulations, effective November 14, 2005. Today’s final rule is based on statutory authorities enacted in 1998 and 2000, and follows a proposed rule published on March 18, 2004 and public comment period. The rule includes several provisions regarding low-income housing tax credit (LIHTC) rents and provisions for properties funded with LIHTCs.

St. Paul, Minn. - October 13, 2005

Minnesota has adopted a tax shelter reporting statute that generally requires material advisors that have filed a federal Form 8264, Application for Registration of a Tax Shelter with the Internal Revenue Service, to file a duplicate of that filing with the Minnesota Department of Revenue by October 17, 2005. Penalties of as much as $50,000 can be imposed for each failure to file.

Some investors in low-income housing tax credit (LIHTC) transactions may be subject to this requirement. Material advisors that have filed a Form 8264 may have a filing requirement in Minnesota if they have sponsored an LIHTC transaction (reportable transaction) that:

  1. Is organized in Minnesota;
  2. Is doing business in Minnesota;
  3. Is deriving income from Minnesota sources; or
  4. Has one or more investors that are Minnesota taxpayers.

Although the law is not entirely clear, it appears this filing requirement may apply to Form 8264 filed with the IRS after December 31, 2000. Click here for more information from the Minnesota Department of Revenue. Questions may be directed to Stephen Tracy at 415-356-8010.

Washington, D.C.- October 10, 2005

The Internal Revenue Service (IRS) this month updated Form 8823, Low-Income Housing Credit Agencies Report of Noncompliance or Building Disposition. The new form includes format changes from the previous version, a few minor additions and more detailed instructions. Click here for a copy of Form 8823. A description of the changes is available in the Property Compliance Report.

September

Washington, D.C.- September 30, 2005

The U.S. Department of Housing and Urban Development (HUD) today reported that the Fair Market Rents (FMR) for fiscal year 2006, effective October 1, 2005, have been released. Today's notice provides final FY2006 FMRs for all areas that reflect the estimated 40th and 50th percentile rent levels trended to April 1, 2006. Click here for the new FMRs.

Jackson, Miss. - September 27, 2005

In response to Hurricane Katrina, the Mississippi Home Corporation (MHC) staff received MHC board approval to allow low-income housing tax credit (LIHTC) developers who have previously received a tax credit allocation, but not yet begun construction on a previously approved site, to move those tax credits to a site located in certain areas as designated by the Federal Emergency Management Agency (FEMA). This approval is expected to allow LIHTC developers to more quickly get rental housing on the ground in these areas thus addressing some of the many critical housing needs. Click here for more information.

Washington, D.C. - September 23, 2005

Sens. Mary Landrieu, D-La., and David Vitter, R-La., yesterday introduced legislation to deliver hurricane relief to Louisiana that includes an increase in low-income housing tax credit (LIHTC) authority from $1.85 per capita to $3.70 for 2006 and 2007. S. 1765, the Louisiana Katrina Reconstruction Act, would also create a new "60-80 test" to allow 60 percent or more of the residential units in an LIHTC project located in any Hurricane Katrina disaster area and placed in service in 2005, 2006 or 2007 to be occupied by individuals whose income is 80 percent or less of area median income. The measure also proposes to change Section 142 of the Internal Revenue Code (IRC) to be consistent with IRC Section 42 to allow properties financed with tax-exempt bonds and LIHTCs to be eligible for relief from income restrictions provided by the Internal Revenue Service in Notice 2005-69. S. 1765 also includes significant provisions for housing programs administered by the U.S. Department of Housing and Urban Development and U.S. Department of Agriculture’s Rural Housing Service.

Sacramento, Calif. - September 21, 2005

The California Tax Credit Allocation Committee (TCAC) this week announced preliminary recommendations for set-aside projects and geographic apportionment in its second low-income housing tax credit (LIHTC) allocation round for 2005. TCAC also published an additional request for comment on a regulation change to clarify how TCAC currently applies the first tiebreaker scoring factor.

Washington, D.C. - September 19, 2005

Rep. Stephanie Tubbs Jones, D-Ohio, last week introduced the Katrina Assistance Tax Relief Incentives for Necessities Act of 2005 to make several changes to the low-income housing tax credit (LIHTC) to make more affordable housing units available in areas devastated by Hurricane Katrina. A press release from Jones’ office says that H.R. 3769 has the support of the Affordable Housing Tax Credit Coalition (AHTCC) and the National Council of State Housing Agencies (NCSHA). H.R. 3769 would double, to $3.70 per capita, the LIHTC authority for Louisiana, Mississippi and Alabama for 2006 and 2007. The measure would also extend Difficult Development Area (DDA) designation to federal disaster areas in Louisiana, Mississippi, Alabama and Florida through 2007. In addition, the bill would waive the national pool full subscription requirement for the four states through 2007, which would allow those states to utilize the excess LIHTCs that other states have not allocated thereby meeting the anticipated high demand for affordable housing during their post-Katrina reconstruction efforts.

Washington, D.C. - September 15, 2005

The House Financial Services Committee's Subcommittee on Housing and Community Opportunity met today for a hearing to spotlight the critical housing needs in the aftermath of Hurricane Katrina.

Washington, D.C. - September 14, 2005

The Affordable Housing Tax Credit Coalition (AHTCC) has prepared and released a list of proposed adjustments to the low-income housing tax credit (LIHTC) and multifamily bond programs to help meet the long-term housing needs resulting from Hurricane Katrina. This information has also been added to Novogradac & Company LLP’s Disaster Relief web page, along with other recent developments and guidance.

Washington, D.C. - September 13, 2005

The U.S. Department of Housing and Urban Development (HUD) today published a final rule implementing statutory changes that enable the use of mixed-finance and for-profit participation in the Section 202 supportive housing program for the elderly, and the Section 811 supportive housing program for persons with disabilities. In addition, the rule provides for the leveraging of low-income housing tax credits (LIHTCs), as well as other sources of funding. This final rule follows an interim rule published on December 1, 2003, and goes into effect October 13, 2005. Click here for copy of the rule.

Washington, D.C. - September 9, 2005

As a result of the devastation caused by Hurricane Katrina, the Internal Revenue Service (IRS) today issued formal guidance in Notice 2005-69 suspending certain requirements under Section 42 of the Internal Revenue Code for low-income housing tax credit (LIHTC) projects in the United States. Click here for a copy of the notice. It should be noted that while many state housing agencies are compiling lists of available housing units for their own use in assisting disaster vicitims, the IRS says that to comply with the requirements of IRC Section 1.42-5, project owners are required to list the project on the National Emergency Resource Registry (NERR) maintained by the Department of Homeland Security at www.SWERN.gov. Additional information about housing-related Hurricane Katrina relief is available here.

San Francisco, Calif. - September 7, 2005

Numerous state and federal housing agencies announced relief efforts last week aimed at providing housing for families and individuals displaced by Hurricane Katrina and this week several additional state housing agencies have announced similar efforts.

The Mississippi Home Corporation reports that it is receiving requests for housing by many of those displaced by the hurricane and is attempting to assist those in need. Owners or managers of LIHTC developments are asked to complete a Unit Availability Assessment form online.

Developers, owners and managers of low-income housing developments in Arkansas were invited by the Arkansas Development Finance Authority (ADFA) to participate in a statewide coordinated effort called Operation KARE (Katrina Assistance and Relief Effort). At this time, ADFA says it is working to identify resources to assist displaced evacuees, including releasing funds for rental assistance and identifying available housing units for families displaced by Hurricane Katrina. For more information contact: Patrick Patton at (501) 682-5902 or Layne Anderson at (501)682- 5464. ADFA has also released a “Hurricane Katrina Displaced Household Certification” form as part of its disaster relief procedures.

The South Carolina State Housing Finance and Development Authority (SCSHFDA) reported last week that South Carolina is receiving victims of the hurricane who are in need of immediate housing. SCSHFDA is looking for owners willing to house these victims; interested property owners are asked to fax or e-mail the following information to Laura Nicholson at (803) 551-4925 or e-mail Laura.Nicholson@schousing.com: contact name and phone number, development name, address, city, county, vacant units by bedroom size, and corresponding rent. If the development will pay utilities, please indicate such, otherwise provide approximate utility allowance. Questions can be directed by phone to (803) 896-9190.

The North Carolina Housing Finance Agency has also posted information and links for evacuees, rental owners and managers including: how to find an apartment; LIHTC rule changes; National Registry Participation; basic questions and answers; and suggestions for a federal response.

The Colorado Housing and Finance Authority (CHFA), announced that it is jointly sponsoring Coloradohousingsearch.com in conjunction with the state’s Division of Housing, USDA Rural Development and the City of Denver, to provide information on available affordable housing statewide. The service is free for both housing providers and housing seekers. Anyone with available housing units should take advantage of this opportunity to link units with people in need of housing, particularly now as evacuees come to Colorado for help.

As additional news becomes available regarding federal and state level housing relief, it will be posted online here. More detailed discussion of the issues related to Hurricane Katrina relief affecting owners and developers of and investors in affordable housing will be available in the October issues of the LIHTC Monthly Report, Property Compliance Report and The Valuation Report.

Washington, D.C. - September 2, 2005

The Treasury Department and the Internal Revenue Service (IRS) today announced that they will waive rules that prohibit owners of low-income housing from providing housing to victims of Hurricane Katrina who do not qualify as low-income under Section 42 of the Internal Revenue Code in order to expand the availability of housing for disaster victims and their families. Because of the widespread devastation to housing caused by Hurricane Katrina, the Treasury Department and the IRS will temporarily suspend income limitation requirements and non-transient requirements for qualified low-income housing tax credit (LIHTC) projects located anywhere in the United States. In 2004, the IRS suspended LIHTC income limitation requirements for 12 months in Alabama, Florida, and Ohio following Hurricanes Frances, Ivan and Jeanne.

Meanwhile, the Louisiana Housing Finance Agency has made a special request of LIHTC property owners and developers to advise the agency via e-mail at complianceinfo@lhfa.state.la.us, of units available by unit type in an effort to provide disaster relief assistance to displaced persons.

Also, the Texas Department of Housing and Community Affairs (TDHCA) has asked owners and managers of LIHTC developments to submit vacancy information submitted through the TDHCA Compliance Monitoring Tracking System (CMTS).

Likewise, the Kentucky Housing Corporation, working with FEMA and the Kentucky HUD office to assist displaced individuals and victims of Hurricane Katrina, is compiling a list of available LIHTC and HOME rental units for the state of Kentucky. KHC is requesting the following information for both LIHTC and HOME units: the number of available units; the number of bedrooms per unit; the address of the property (including city); a contact person (including telephone number and e-mail address). Owners and managers are asked to send these details to Doug Wade at dwade@kyhousing.org by 4 p.m., ET, on Wednesday, September 7.

The Federal Emergency Management Agency (FEMA) and the Department of Homeland Security have created a clearinghouse to collect information on housing available for hurricane victims. Apartment owners that have units available that they would like to add to the registry, are asked to submit that information to the National Emergency Resource Registry (NERR) at www.swern.gov. HUD has also announced it is providing disaster relief and posted details of its ongoing and planned efforts.

August

Washington, D.C. - August 30, 2005

The U.S. Department of Housing and Urban Development (HUD) today announced changes of the mortgage insurance premiums (MIP) for several Federal Housing Administration (FHA) multifamily mortgage insurance programs whose commitments will be issued or reissued in fiscal year (FY) 2006. For all sections of the National Housing Act where the mortgagor equity is produced from the proceeds of the sale of low-income housing tax credits (LIHTCs), the MIP is reduced to 45 basis points. The also notice includes MIPs for project mortgages without LIHTCs. HUD will accept comments on today’s announcement through September 29, 2005; the effective date for these changes is proposed to be October 1, 2005. Click here for the notice, including a table of FY 2006 MIP rates and instructions for submitting comments.

Washington, D.C. - August 25, 2005

The U.S. Department of Housing and Urban Development today published a notice supplementing the proposed fair market rents (FMRs) for fiscal year 2006. In a June 2 Federal Register notice, HUD advised that it would also publish a separate notice to identify any areas that may be newly eligible for 50th percentile FMRs as well as any areas that remain eligible or that are no longer eligible for 50th percentile FMRs, as provided in HUD’s regulations. Click here for a copy of today’s notice, which identifies 24 areas eligible for 50th percentile FMRs. Comments will be accepted through September 26, 2005.

Washington, D.C. - August 22, 2005

The U.S. Department of Housing and Urban Development (HUD) today published a notice designating Difficult Development Areas (DDAs) 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. The Qualified Census Tracts (QCTs) designated in December 12, 2002, as supplemented on December 19, 2003, remain in effect. Click here for a copy of the notice and lists of metro and non-metro DDAs and QCTs.

Washington, D.C. - August 9, 2005

The Internal Revenue Service (IRS) and Treasury Department yesterday released their 2005-2006 priority guidance plan, listing the guidance projects the government expects to have completed by June 2006. The plan contains 254 projects, including a general entry for guidance under Internal Revenue Code Section 42 regarding the low income housing tax credit (LIHTC), as well as proposed regulations under Section 42(h) regarding the requirements for a qualified contract. Click here for a copy of the 2005-2006 priority guidance plan.

Denver, Colo. - August 2, 2005

The Colorado Housing and Finance Authority (CHFA) will host a meeting at 9:30 a.m. on August 30 to discuss the qualified allocation plan (QAP) for 2006. This will be the first of several meetings to discuss ideas on the administration of low-income housing tax credit (LIHTC) allocation, as well as to hold discussions to prioritize the use of LIHTCs from a policy perspective. For details about the meeting, click here. For additional information, please visit www.colohfa.org or contact Paula Harrison.

Raleigh, N.C. - August 1, 2005

The North Carolina Housing Finance Agency (NCHFA) today released a draft of its 2006 qualified allocation plan (QAP) for administering the low-income housing tax credit (LIHTC) program. NCHFA will hold a public hearing on the draft QAP at 2 p.m. on August 17. For more information on the QAP and public hearing, please click here.

July

Washington, D.C. - July 25, 2005

The Internal Revenue Service (IRS) this month published the amounts of unused low-income housing tax credit (LIHTC) carryovers for calendar year 2005 that were allocated to 36 qualified states under IRC §42(h)(3)(D). Revenue Procedure 2005-36 details how more than $6 million of unused LIHTCs were divided among the states in the National Pool. For a copy of Rev. Proc. 2005-36, click here.

Washington, D.C. - July 20, 2005

The U.S. Department of Housing and Urban Development (HUD) announced today that it is revising its Handbook 4350.3 REV-1, “Occupancy Requirements of Subsidized Multifamily Housing Programs.” HUD will accept comment on the revisions through August 9, 2005. Analysis of the proposed changes will be available in the September 2005 issue of the Property Compliance Report.

Washington, D.C. - July 19, 2005

The National Housing Conference (NHC) is circulating a “Dear Representative” letter and encouraging interested parties to send it to their Congressional representatives to generate support for the “Housing America's Workforce Act of 2005.” H.R. 3194 was introduced last month by Rep. Nydia Velázquez, D-N.Y. and would help promote employer assisted housing (EAH) and provide a tax incentive to employers who participate. NHC reports that a “Dear Colleague” letter is also being circulated in the House of Representatives in support of the measure. A companion bill, S. 1330, was introduced in the Senate last month by Sens. Hillary Rodham Clinton, D-N.Y.; Gordon Smith, R-Ore.; and Mel Martinez, R-Fla. Detailed analysis of the measures will be available in the August 2005 LIHTC Monthly Report.

Lincoln, Neb. - July 11, 2005

Nebraska’s application for 2006 low-income housing tax credits (LIHTCs) was approved last week by Gov. Dave Heineman and is now available from the Nebraska Investment Finance Authority web site. The 2006 package includes a joint application for LIHTC and HOME funds administered by the Nebraska Department of Economic Development. Applications for the first round of applications are due September 12, 2005.

Washingon, D.C. - July 8, 2005

Rep. Phil English, R-Pa., last week introduced the Community Restoration and Revitalization Act of 2005, a bill that would make several modifications to the rehabilitation tax credit and low-income housing tax credit (LIHTC). Some of the changes H.R. 3159 proposes are: to modify the rules for determining the applicable percentage for certain buildings eligible for the LIHTC; increase the rehabilitation credit for smaller projects; and increase the rehabilitation credit in high cost areas. The measure currently has 22 co-sponsors; upon introduction it was referred to the House Committee on Ways and Means. Click here for a copy of the bill.

Sacramento, Calif. - July 6, 2005

California Tax Credit Allocation Committee (TCAC) executive director Lynn Wehrli released a memo last week to applicants for TCAC's second round of low-income housing tax credit (LIHTC) allocation regarding the Department of Industrial Relations recent confirmation that federal tax credits and tax-exempt bond financing are not subject to prevailing wage requirements. The memo outlines the implications of the DIR ruling and the options available to applicants for LIHTCs. Click here for a copy of the memo.

Nashville, Tenn. - July 1, 2005

The Tennessee Housing Development Agency (THDA) today announced the preliminary scoring and ranking of applications for its 2005 competitive low-income housing tax credit (LIHTC) program. Click here for more information.

June

Austin, Texas - June 23, 2005

At its meeting next week, the Texas Department of Housing and Community Affairs (TDHCA) board of governors is scheduled to consider and approve applications for the first round of low-income housing tax credit (LIHTC) allocations for 2005. TDHCA received 166 full applications requesting $100,255,949 in credits; 17 of those applications were subsequently terminated or withdrawn by the applicant and four developments were awarded 2005 funds as forward commitments last year. Of the remaining 145 applications currently competing for LIHTCs, TDHCA staff has recommended 63 for approval. Click here for more information.

Washington, D.C. - June 22, 2005

The Internal Revenue Service (IRS) announced a safe harbor in Revenue Procedure 2005-37 under which state housing agencies and low-income housing tax credit (LIHTC) project owners may meet the requirements of Internal Revenue Code Section 42 concerning extended low-income housing commitments. As described in Question and Answer #5 of Revenue Ruling 2004-82, Section 42(h)(6)(B)(i) requires that eviction and rent increase restrictions apply throughout the extended use period and not simply for the three years after that period – an interpretation contrary to industry practice. The safe harbor in Rev. Proc. 2005-37 allows LIHTC commitments entered into before January 1, 2006 to use catch-all language to comply with this interpretation. Specific language relating to the restrictions must be included in commitments executed after December 31, 2005.

Chicago - June 20, 2005

Gov. Rod R. Blagojevich last week signed into law House Bill 603, immediately extending the Illinois Affordable Housing Tax Credit for five more years. The Illinois affordable housing credit provides a 50-cent state income tax credit for each $1 donated. H.B. 603, sponsored by Illinois Rep. Arthur L. Turner, D-Chicago, and Sen. William E. Peterson, R-Buffalo Grove, extends the sunset provision of the Illinois Affordable Housing Tax Credit from December 31, 2006 to December 31, 2011.

Austin, Texas - June 15, 2005

The Texas Department of Housing and Community Affairs (TDHCA) announced today that it will conduct a public hearing on Tuesday, July 5, 2005 to gather input on its proposed qualified contract policy. The proposed policy was drafted to assist owners of low-income housing tax credit (LIHTC) properties that received a credit allocation after January 1, 1990 and who desire to exit the program after the initial 15 year affordability period. Click here for a copy of the proposed qualified contract policy. Click here for details about the hearing.

Washington, D.C. - June 13, 2005

In anticipation of recommendations from the Treasury Secretary on tax reform, the House Ways and Means Committee held the first of several hearings last week to discuss reforming the current tax code. At the hearing, Rep. Nancy L. Johnson, R-Conn., spoke in support of tax incentives such as the low-income housing tax credit (LIHTC). The Washington Post reports that Johnson said, “You've got to have better information for me to convince me that tax credits aren't powerful or important in structuring a society.” Click here for more information about the hearing.

Washington, D.C. - June 10, 2005

The Internal Revenue Service (IRS) June 8 released new instructions for filing Form 8693, Low-Income Housing Credit Disposition Bond, that no longer require approved forms to be filed with income tax returns. According to the instructions, issued in Announcement 2005-43, IRS said the form is to be filed within 60 days after the date of the "disposition of the building or interest." Taxpayers are required to file Form 8693 to post a bond and avoid recapture of the accelerated portion of the low-income housing credit as necessitated by the owner's disposition of a building or an interest therein. IRS said it will return a copy of approved forms, but said taxpayers no longer are required to attach that copy to their income tax return. The announcement instructs filers to send the original form, plus a copy, to IRS. This announcement is scheduled to appear in Internal Revenue Bulletin 2005-26, dated June 27.

Sacramento, Calif. - June 9, 2005

The California Tax Credit Allocation Committee (TCAC) yesterday awarded 9 percent credits to 31 projects out of 55 applicants in its first round of 2005 funding. The allocations included $28,186,625 in federal tax credits and $15,964,816 in state tax credits. Click here for a list of awardees and to-date demand and award comparisons. More information will be posted here as it becomes available from TCAC.

Washington, D.C. - June 8, 2005

U.S. Department of Housing and Urban Development (HUD) has extended the FY 05 NOFA application deadline for the Section 202 program to July 1, 2005. The Federal Register notice also makes technical corrections to the Section 202, Assisted Living Conversion Program, and Section 811 Program NOFAs . For more information, click here.

Sacramento, Calif. - June 3, 2005

The California Department of Industrial Relations (DIR) this week issued two rulings related to prevailing wage requirements that are applicable to the construction of affordable housing. The first ruling denies an appeal of the DIR decision earlier this year that low-income housing tax credits (LIHTCs) and tax-exempt bonds do not trigger prevailing wage. In the second ruling, which involves a new case, DIR also concludes that LIHTCs and tax-exempt bonds do not trigger prevailing wage. The new ruling also determines that below market interest rate loans from a local agency do not trigger prevailing wage if at least 40 percent of the units are restricted for at least 20 years to tenants earning no more than 80 percent of the area median income.

Washington, D.C. - June 1, 2005

The U.S. Department of Housing and Urban Development (HUD) today published proposed fair market rents (FMRs) for fiscal year 2006. 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. The proposed 2006 FMRs were calculated using the revised Office of Management and Budget (OMB) area definitions that were issued in 2003, a change originally included in the 2005 FMRs but withdrawn after the affordable housing industry voiced concern over wide swings for certain communities. For 2006, HUD used the county-based statistical areas as defined by OMB, with some modifications. HUD will accept public comments on the proposed FMRs through August 1, 2005.

Austin, Texas - June 1, 2005

The Texas Department of Housing and Community Affairs (TDHCA) announced last week that it has drafted a proposed qualified contract policy to assist owners of low-income housing tax credit (LIHTC) properties that received a credit allocation after January 1, 1990 and who desire to exit the program after the initial 15 year affordability period. Once TDHCA's governing board approves the proposed policy, TDHCA will publish the draft in the Texas Register and release the document to the public for comment.

San Francisco, Calif. - June 1, 2005

The Federal Home Loan Bank (FHLB) of San Francisco yesterday announced approximately $21.8 million in Affordable Housing Program (AHP) grants in the first round of the 2005 competition. The AHP grants will support 49 projects and generate nearly 3,056 affordable housing units in Arizona, California, Nevada and Texas. Click here for details.

May

Washington, D.C. - May 25, 2005

Rep. William J. Jefferson, D-La., and 53 co-sponsors today introduced H.R. 2681, the Affordable Housing Tax Credit Enhancement Act of 2005. The bill would double the current low-income housing tax credit (LIHTC) from $1.85 per capita to $3.70 per capita beginning in 2006 and rename the LIHTC the “Affordable Housing Tax Credit” to remove any negative connotation and more accurately describe the program. In his introductory statement, Jefferson extolled the LIHTC as “the nation's most successful housing production program” and said it is “unparalleled in contributing to the revitalization of distressed neighborhoods and communities.” Click here for copy of the measure.

Washington, D.C. - May 25, 2005

Reps. William Jefferson, D-La., and Phil English, R-Pa., this week circulated a “Dear Colleague” letter asking for support for a bill that they plan to introduce later this week. The bill would double the current LIHTC from $1.85 per capita to $3.70 per capita beginning in 2006; and change the name of the program from the “Low-Income Housing Credit” to the “Affordable Housing Tax Credit.” For a copy of the letter, please click here.

Washington, D.C. - May 23, 2005

The Internal Revenue Service (IRS) today issued Treasury Decision 9204 amending Internal Revenue Code (IRC) Section 143(g) regulations, providing rules regarding the limitation on the effective rate of mortgage interest for purposes of mortgage revenue bonds issued by state and local governments. The final regulations are effective today. Click here for a copy of T.D. 9204.

Washington, D.C. - May 19, 2005

The Internal Revenue Service (IRS) and the Treasury Department today issued revisions to the new Treasury Department Circular 230 standards for written tax advice that were announced late last year. Click here for details. Treasury and IRS also separately issued proposed regulations last year regarding written advice concerning tax-exempt bonds. More information will also be available in the June 2005 issue of the Housing Bond Report.

Washington, D.C. - May 18, 2005

The U.S. Department of Housing Urban Development today awarded $126.8 million in HOPE VI Revitalization grants to seven housing authorities in Allentown, Pa.; El Paso, Texas; Greenville, S.C.; Philadelphia, Pa.; Springfield, Ohio; Tucson Ariz.; and Tuscaloosa, Ala. The grantees were selected from a pool of 33 applications. Including this round, HUD has awarded 224 grants totaling $5.6 billion to 121 cities. To date, 42 HOPE VI communities have been completed and more than $2.4 billion of the awarded funds remain to be spent. For details, please click here.

Washington, D.C. - May 17, 2005

Federal agencies, including the Department of Housing and Urban Development (HUD), Internal Revenue Service (IRS) and Treasury, published their semiannual regulatory agendas, listing regulations and other guidance projects that are planned or that will be developed in the coming year. Among the guidance listed are rules in various stages for the Section 8, Community Development Block Grants and other HUD administered programs. Click here for a copy of HUD's regulatory agenda. Treasury also has guidance planned regarding amendments to the general public use requirements in the low-income housing tax credit (LIHTC) program. Click here for Treasury's guidance agenda.

Washington, D.C. - May 16, 2005

The Internal Revenue Service (IRS) last week invited comments on Treasury Decision 8801, the arbitrage restrictions on tax-exempt bonds issued by state and local governments and rules regarding the use of proceeds of state and local bonds to acquire higher yielding investments under Section 148 of the Internal Revenue Code. There are no changes being made to the regulations at this time; this review is part of a continuing effort to reduce paperwork and respondent burden as required by the Paperwork Reduction Act of 1995 Written comments will be accepted through July 12, 2005. Click here for details.

New Orleans, La. - May 13, 2005

Speaking to participants of Novogradac & Company LLP's Credit & Bond Financing for Affordable Housing in New Orleans, Rep. William Jefferson, D-La., said today that he will propose legislation next week that would double the current low-income housing tax credit of $1.85 per capita to $3.70 in FY 2006. Additionally, Jefferson said he will join Reps. Jim Ramstad, R-Minn, and Ben Cardin, D-Md., to introduce legislation they championed in the last Congress to reform the "exit tax" imposed on developers of affordable housing. The proposed legislation would waive the exit tax for owners who sell their properties to buyers who agree to keep the properties affordable for no less than 30 years. Jefferson also told attendees that he would join Rep. Phil English, R-Pa., in introducing the Community Restoration and Revitalization Act, a bipartisan bill that would improve the existing historic preservation tax credit for the restoration and rehabilitation of the nation's vacant and underutilized historic buildings. One of the features of the proposal is its usefulness in creating affordable rental housing in some of those historic buildings; the law allows the rehab credit to be "paired" with the Low-Income Housing Tax Credit in certain projects. For more details on these pieces of proposed legislation, see future issues of the LIHTC Monthly Report.

Washington, D.C. - May 11, 2005

The Internal Revenue Service (IRS) today published Revenue Procedure 2005-30, which provides guidance regarding an extension of time for private activity bond issuing authorities that fail to make a timely carryforward election. The relief provided under Rev. Proc. 2005-30 is in lieu of the letter ruling procedure that is used to request an extension of time under Internal Revenue Code § 301.9100-3.

Sacramento, Calif. - May 10, 2005

The California Debt Limit Allocation Committee (CDLAC) will meet next week to consider applications for more than $1 billion in tax-exempt bond allocations, including applications for qualified residential rental projects totaling $417,219,219. Click here for a list of applications. Click here for a copy of the meeting agenda.

Austin, Texas - May 9, 2005

A bill scheduled for consideration tomorrow by the Texas House of Representatives would make significant changes to the Texas Department of Housing and Community Affairs (TDHCA), including its rules for awarding low-income housing tax credits (LIHTCs). H.B. 1167, introduced in the Texas Legislature by Rep. Robert Talton, R-Pasadena, directs TDHCA to award the highest number of points on applications for LIHTCs to developers that provide at least 50 percent of their units to persons at or below 30 percent of the area median income (AMI). Talton also said he would offer an amendment during the floor debate tomorrow that would increase the likelihood of allowing developers to use LIHTCs for the development of single-family housing, which is currently prohibited.

Washington, D.C. - May 2, 2005

To improve the usefulness of its fair market rent (FMR) estimates, the Government Accountability Office (GAO) recommends that the U.S. Department of Housing and Urban Development (HUD) fully document its methods for estimating FMRs by following all of its data quality guidelines; use, to the extent possible, state-level American Community Survey (ACS) data to update the fiscal year 2006 FMRs; and develop a mechanism to assess the accuracy of future FMRs. GAO makes these recommendations in a report requested by the Senate Committee on Banking, Housing, and Urban Affairs' Subcommittee on Housing and Transportation; GAO was asked to review HUD's process for estimating FMRs and the impact that the incorporation of the ACS could have on the accuracy of FMRs. Click here for the complete report.

April

Los Angeles - April 29, 2005

In little more than half a decade, the number of America's working families paying more than 50 percent of their income for housing has grown 76 percent, according to a new study funded by Freddie Mac and released today at an affordable housing forum in Los Angeles sponsored by Century Housing, Freddie Mac and the National Housing Conference (NHC). “The Housing Landscape for America's Working Families 2005” was conducted by the Center for Housing Policy, NHC's research affiliate, and focuses on working families that had critical housing needs between 1997 and 2003. The report found that one in every eight, or 14.1 million, families had critical housing needs in 2003 – meaning they paid more than half their income for housing and/or lived in physically dilapidated conditions. Click here for the complete study.

Bismarck, N.D. - April 27, 2005

The North Dakota Housing Finance Agency (NDHFA) adopted Year 15 compliance and opt-out policies for its properties participating in its low-income housing tax credit (LIHTC) program.

To discuss qualified contracts and other Year 15 issues, join Novogradac & Company LLP in New Orleans May 11-13 for the Credit and Bond Financing for Affordable Housing Conference where a panel of industry experts will present a case study to discuss the true value of a qualified contract, rights of first refusal, buyout options, exit taxes and more.

Washington, D.C. - April 26, 2005

The Federal Housing Finance Board (FHFB) today invited public comments concerning proposed changes to the data it collects from applicants to its Affordable Housing Program (AHP). Under the AHP each member bank contributes at least 10 percent of its previous year's net earnings to subsidize the cost of affordable owner-occupied and rental housing targeted to individuals and families with incomes at or below 80 percent of the area median income. Click here for details on the proposed changes and instructions for submitting comments.

Trenton, N.J. - April 22, 2005

The New Jersey Housing and Mortgage Finance Agency (NJHMFA) has proposed the addition of a new rule to the low-income housing tax credit (LIHTC) qualified allocation plan (QAP). The new rule would permit exchanges of LIHTCs when several conditions are met. Click here for the complete text of the proposed rule and instructions for submitting comments. A public hearing on the proposal will be held on May 24, 2005 at 10 a.m. in NJHMFA's board meeting room at 637 South Clinton Avenue in Trenton, N.J. Written comments on the proposed amendments will be accepted by June 17, 2005.

Washington, D.C. - April 21, 2005

Last week, Sen. Wayne Allard, R-Colo., introduced S. 771, which would replace the existing Section 8 housing choice voucher program with a flexible voucher program. The “State and Local Flexibility Act of 2005,” which is similar to proposals put forward in previous sessions, would permit as much as 90 percent of vouchers to go to families with incomes up to 60 percent of the area median and make sweeping changes to public housing agencies' (PHAs) implementation of the program. Some affordable housing advocates warn that the proposed changes would make future funding cuts more likely in both the voucher and public housing programs. Click here for a copy of S. 771.

Washington, D.C. - April 20, 2005

According to a recent report by the National Park Service, Missouri led the nation in the amount invested by developers for the rehabilitation of Missouri buildings certified for federal historic preservation tax credits in fiscal year 2004. The $357,783,822 invested by developers in Missouri is $134 million more than in Pennsylvania, which ranked second, and more than twice the $157 million invested by developers in Illinois, which ranked third. Click here for a copy of the report.

Salem, Ore. - April 19, 2005

Each $1 that Oregon Housing and Community Services (OHCS) invests in affordable housing development in Oregon generates as much as $15 in economic benefit across the state, according to the report “Housing as an Economic Stimulus” released yesterday by Oregon Housing and Community Services. The agency's report also found that every $1 in project labor income generates an additional $1.20 or more in labor income across the state; each job supported or created through housing development generates another one or more at the local level; and every $10,000 in rental income generates more than $19,000 in economic activity across the state. Click here for a copy of the report.

Sacramento, Calif. - April 18, 2005

Earlier this month, the California Tax Credit Allocation Committee (TCAC) issued new rules implementing a “good cause” standard for all affordable housing tenant evictions and renewals. This new requirement is in response to a provision in Internal Revenue Service (IRS) Revenue Ruling 2004-82 that clarified its position on the requirements for extended-use agreements for low-income housing tax credit (LIHTC) properties, contradicting the universally understood requirements that have long been used by state housing finance agencies and LIHTC professionals. The Washington State Housing Finance Commission (WSHFC) enacted a similar “good cause” policy late last year. More information will be available in the May issue of the Property Compliance Report.

Austin, Texas - April 14, 2005

The Texas Department of Housing and Community Affairs (TDHCA) will host a series of meetings for low-income housing tax credit (LIHTC) applicants in 2005 in an effort to make the LIHTC allocation process better and more transparent. TDHCA says the focus of these meetings will be to provide clarification concerning specific applications, but the meetings are also open to the public and will allow for public discussion with key members of the allocation staff. Click here for a schedule of the meetings, which will run through July.

Washington, D.C. - April 13, 2005

A homeownership tax credit (HOTC) bill was introduced yesterday in the House by Reps. Tom Reynolds, R-N.Y., and Ben Cardin, D-Md. to spur the production of affordable housing. H.R. 1549, the Renewing the Dream Tax Credit Act, again proposes a credit modeled after the low-income housing tax credit (LIHTC); developers and investors could receive a tax credit of up to 50 percent of the cost of constructing a new home or rehabilitating an existing property. For the fifth consecutive year, the homeownership tax credit was also funded in the Bush Administration's proposed annual budget. Similar legislation received strong bipartisan support in both the House and the Senate, garnering more than 300 House cosponsors during the 108th Congress.

Washington, D.C. - April 11, 2005

A multi-lateral task force released a report last week addressing the preservation of rental properties funded by the U.S. Department of Agriculture's Section 515 program, which helps property owners develop rentals for low-income rural residents. The group released its report in Washington, D.C. at a conference entitled "Preserving Rural Rental Housing: Actions and Strategies," sponsored by the Housing Assistance Council and the National Housing Law Project and supported by a grant from the John D. and Catherine T. MacArthur Foundation.

Albuquerque, N.M . - April 7, 2005

Effective July 1, 2005, an affordable housing tax credit will be available to taxpayers in New Mexico. Under H.B. 410, the New Mexico Mortgage Finance Authority (NMMFA) will issue vouchers to persons for 50 percent of the amount of cash invested or the fair market value of the land, building or service invested in an affordable housing project approved by the authority. NMMFA will have $200,000 in vouchers to issue in 2006, to be raised to $500,000 in 2007; in 2008, the limit will be increased to $1.85 per capita and starting in 2009 the amount of available vouchers will be indexed for inflation.

Washington, D.C. - April 6, 2005

Rep. Nancy Johnson, R-Conn., yesterday introduced H.R. 1468 to amend the Internal Revenue Code to replace the recapture bond provisions of the low-income housing tax credit (LIHTC) program. The bill, which was co-sponsored by Reps. Kenny Hulsof, R-Mo., and Charles Rangel, D-N.Y., was referred to the Committee on Ways and Means.

Washington, D.C. - April 5, 2005

The U.S. Department of Housing and Urban Development (HUD) today invited comments from members of the public and affected agencies concerning the Annual Adjustment Factors (AAF) rent increase requirement. Owners of project-based section 8 contracts that utilize the AAF as the method of rent adjustment provide this information, which is necessary to determine whether or not the subject properties' rents are to be adjusted and, if so, the amount of the adjustment. Comments will be accepted through May 5, 2005.

Sacramento, Calif. - April 4, 2005

Last year, the California State Board of Equalization (BOE) announced a project to adopt new property tax rules to implement statutory law pertaining to welfare exemption rules as they apply to low-income housing properties. Last week, the BOE published drafts of the following proposed rules: Rule 140, Requirements of Managing General Partner of Limited Partnership for Welfare Exemption for Low-Income Housing Properties; Rule 141, Requirements for Supplemental Clearance Certificate for Limited Partnership for Welfare Exemption For Low-Income Housing Properties; Rule 142, Welfare Exemption Requirements for Low-Income Housing Properties; and Rule 143, Requirements for Irrevocable Dedication Clause and Dissolution Clause for Welfare Exemption. Interested parties may submit comments, in the form of alternative language, on the drafts of the proposed rules by April 20, 2005, to Ladeena Ford at ladeena.ford@boe.ca.gov. Click here for more information.

March

Washington, D.C. - March 31, 2005

The U.S. Department of Housing and Urban Development (HUD) today published a notice of funding availability (NOFA) announcing approximately $110 million in fiscal year 2005 funds for HOPE VI Revitalization Program grants, plus approximately $25 million additional funds for grantees' first-year, grant-related housing choice voucher (HCV) assistance. Applications are due by June 29, 2005 and HUD estimates it will award grants approximately September 27, 2005. HUD notes that although this NOFA announces the availability of FY 2005 HOPE VI funds, the FY 2006 proposed budget includes the rescission of the FY 2005 HOPE VI appropriation. Therefore, today's NOFA may be cancelled at a later date and applications made under this NOFA may not be funded.

Washington, D.C. - March 25, 2005

The Internal Revenue Service (IRS) today invited comments concerning Form 8823, Low-Income Housing Credit Agencies Report of Noncompliance or Building Disposition. Under Internal Revenue Code section 42(m)(1)(B)(iii), state agencies are required to notify the IRS of noncompliance with the low-income housing tax credit (LIHTC) provisions. The IRS uses this information to determine whether the LIHTC is being correctly claimed and whether there is any credit recapture. There are no changes being made to Form 8823 at this time; this review is part of a continuing effort to reduce paperwork and respondent burden as required by the Paperwork Reduction Act of 1995. Written comments should be received on or before May 24, 2005 to be assured of consideration. Click here for details about submitting comments.

Denver, Colo. - March 24, 2005

The Denver rental market is turning around slowly, but production of new affordable units in the downtown Denver market should be limited until 2007, according to a study recently commissioned by the Colorado Housing and Finance Authority (CHFA). The study was commissioned to assess the current condition of, and provide an outlook for, the downtown Denver rental housing market as CHFA considers loan and low-income housing tax credit (LIHTC) applications. While the report recommends cutting back on production, it says the outlook for the Denver-Boulder metro area does not imply a complete halt to apartment building. The report gives detailed analysis of the area's submarkets, incomes of potential renters and other relevant data.

The deadline for the next round of LIHTC allocation applications in Colorado is June 1.

Washington, D.C. - March 23, 2005

The U.S. Department of Housing and Urban Development (HUD) this week announced the availability of funding through its discretionary programs. The fiscal year (FY) 2005 Super Notice of Funding Availability (SuperNOFA) comprises 53 funding opportunities totaling approximately $2.26 billion. Electronic application submission is mandatory for all programs included in the FY 2005 SuperNOFA unless applicants receive a waiver from HUD. Click here for more information.

Washington, D.C. - March 16, 2005

The Rural Housing Service (RHS) this week announced the availability of housing funds for fiscal year 2005 for programs including Section 514 Farm Labor Housing loans, Section 515 Rural Rental Housing (RRH) loans, Section 521 Rental Assistance (RA), Section 533 Housing Preservation grants (HPG) and the Section 538 Guaranteed Rural Rental Housing Program. Click here for details.

Washington, D.C. - March 15, 2005

The Office of the Comptroller of Currency (OCC), Federal Housing Finanace Board and Federal Deposit Insurance Commission (FDIC) last week issued a notice of proposed rulemaking to revise certain provisions of the Community Reinvestment Act (CRA). This latest rule was issued in response to public comments received by the federal banking agencies and the Office of Thrift Supervision (OTS) on a February 2004 inter-agency CRA proposal and by the FDIC on its August 2004 CRA proposal. The current proposal would provide a simplified lending test and a flexible new community development test for small banks with an asset size between $250 million and $1 billion. Also, holding company affiliation would not be a factor in determining which CRA evaluation standards applied to a bank. In addition, the proposal would revise the term “community development'” to include certain community development activities, including affordable housing, in underserved rural areas and designated disaster areas. Comments will be accepted on the proposal through May 10, 2005. Click here for more information.

Washington, D.C. - March 11, 2005

The U.S. Department of Housing and Urban Development (HUD) low-income housing tax credit (LIHTC) database has been updated to include information on nearly 22,000 projects and more than 1,141,000 housing units placed in service between 1987 and 2002. The geocoded database includes size, unit mix and location of individual projects as well as project address, year the LIHTC was allocated, year the project was placed in service, whether the project was new construction or rehabilitation, type of credit provided, and other sources of project financing. Click here to access HUD's LIHTC database.

Austin, Texas - March 10, 2005

The Texas Department of Housing and Community Affairs (TDHCA) will hold 13 public hearings to gather public comment on the 9 percent low-income housing tax credit (LIHTC) applications for 2005. A detailed log of all 2005 applications is posted to at www.tdhca.state.tx.us. Written comments are also encouraged.

Washington, D.C. - March 8, 2005

The Internal Revenue Service (IRS) is encouraging business taxpayers, associations and other interested parties to submit tax issues for the Industry Issue Resolution (IIR) Program by March 31, 2005. The objective of the IIR program is to resolve, through new and improved guidance, business tax issues in situations where the tax treatment is uncertain, frequently disputed or burdensome and that are common to significant numbers of taxpayers. For each issue selected, an IIR team of IRS and Treasury personnel, whose goal is to recommend guidance to resolve the issue, gather relevant facts from taxpayers or other interested parties. All requests received by March 31, 2005, will be considered for IIR project selections that are expected to be included in the 2005-2006 Treasury and IRS Guidance Priority List. Click here for IIR project submission procedures and selection criteria.

Sacramento, Calif. - March 7, 2005

The California Tax Credit Allocation Committee (TCAC) last week published a memo to first-round applicants for low-income housing tax credits (LIHTCs) in light of prevailing wage coverage determinations on two LIHTCs projects issued February 25 by the Department of Industrial Relations (DIR). The determinations that found that federal tax credits and tax-exempt bond financing are not subject to prevailing wage requirements are expected to reduce project costs and enable TCAC to fund more projects. However, because it is expected that an appeal will be filed there is continued uncertainty with respect to development costs. TCAC has made some adjustment to application requirements and procedures, including that all applications must be based on the assumption that prevailing wages will apply. Applications for the first round of LIHTCs are due March 17. Click here for a copy of the memo.

Washington, D.C. - March 2, 2005

The House Financial Services Committee, chaired by Rep. Michael G. Oxley, R-Ohio, this morning heard testimony from U.S. Department of Housing and Urban Development (HUD) Secretary Alphonso Jackson. The hearing focused on HUD's budget request for fiscal year 2006. Jackson defended proposals for deep cuts to housing programs but disappointed some committee members by declining to give any specifics about the Strengthening America's Communities Initiative (SACI) that would integrate Community Development Block Grants and several other economic development programs in to one grant program within the Commerce Department; Jackson says the details are still being determined and may not be disclosed until mid-April. Click here for a copy of Jackson's prepared statement to the committee.

Washington, D.C. - March 1, 2005

The Department of Commerce today invited nominations for persons to serve on the Strengthening America's Communities Advisory Committee, which will provide advice and recommendations, and develop a comprehensive written report of policy parameters to assist in implementing President George W. Bush's Strengthening America's Communities Initiative (SACI), including advising on its legislation, regulations and other guidance. SACI proposes to transfer and consolidate 18 federal economic and community development programs from the Departments of Agriculture, Commerce, Health and Human Services, Housing and Urban Development and Treasury within the Department of Commerce.

February

Washington, D.C. - February 28, 2005

Revised final fiscal year 2005 fair market rents (FMRs) are available in a notice published today by the U.S. Department of Housing and Urban Development (HUD). FMRs are 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 payment (HAP) contracts in the Moderate Rehabilitation Single Room Occupancy program. Today's notice revises the final FY2005 FMRs that were published on October 1, 2004, for a limited number of areas. Click here for details.

San Francisco, Calif. - February 25, 2005

The California Department of Industrial Relations has ruled that the Rancho Santa Fe Village Senior Affordable Housing Project in San Marcos, Calif. is not a public work and that its Section 42 federal tax credits and Section 142 tax-exempt bonds do not trigger prevailing wage.  The ruling covers only federal tax credits under Section 42 of the Internal Revenue Code and private activity bonds issued under the volume cap from the California Debt Limit Allocation Committee.  Accordingly, the use of other subsidies in the construction of a project may trigger the prevailing wage requirement. This ruling is likely to be appealed. Click here for a copy of the ruling.

Washington, D.C. - February 24, 2005

In Notice 2005-22 the Internal Revenue Service (IRS) extends the deadline for material advisors to comply with the new filing requirements under Section 6111 provided in Notice 2004-80. General partners and/or developers of low-income housing tax credit (LIHTC), historic rehabilitation or new markets tax credit (NMTC) partnerships or properties that closed after October 22, 2004 may have a filing requirement as a material advisor. According to Notice 2005-22 if a person becomes a material advisor after October 22, 2004, and on or before March 31, 2005, that material advisor must file the required return on or before April 30, 2005. The penalties for non-compliance can be very severe, so parties involved with partnership closings after October 22, 2004 are urged to read Notices 2004-80, 2005-17 and 2005-22.

Washington, D.C. - February 22, 2005

In Notice 2005-16, the Internal Revenue Service (IRS) today released new population figures for calculating the 2005 population-based component of states’ low-income housing tax credit (LIHTC) ceilings, 2005 volume caps and the 2005 volume limit. The population figures for the 50 states, the District of Columbia, and Puerto Rico were released by the Census Bureau on December 22, 2004. The population figures for American Samoa, Guam, Northern Mariana Islands and U.S. Virgin Islands were released on July 17, 2003. Under Revenue Procedure 2004-71, each state’s LIHTC ceiling in 2005 is the greater of $1.85 multiplied by the state population or $2,125,000. Each state’s ceiling for the volume cap for private activity bonds in 2005 is the greater of $80 multiplied by the state population or $239,180,000.

Sacramento, Calif. - February 17, 2005

The California Tax Credit Allocation Committee (TCAC) today finalized the regulations for its low-income housing tax credit (LIHTC) program for 2005. TCAC also announced the first application deadline for LIHTCs will be March 17.

Novogradac & Company will present an LIHTC application workshop in Sacramento on February 24 and in Los Angeles on February 25. TCAC Executive Director Lynn Wehrli, along with TCAC staff, will be participating in the workshops and will be available to answer questions. These workshops are sponsored by Boston Capital. TCAC will not be having its own workshops prior to the application deadline.

San Francisco, Calif. - February 14, 2005

Novogradac & Company LLP's Rent & Income Calculator has been updated to include HUD's 2005 rent and income limit data. It is available online with the compliments of Novogradac & Company LLP. This program 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; provide the HUD sourced 30%, 50%, and 80% income limits for the selected county; automatically calculates the LIHTC rent and income limits for any selected percentage of the area median income (AMI) for the selected county; and the user may select parameters to calculate rent and income limits for other affordable housing programs.

Novogradac & Company LLP's Rent & Income Limit Calculator on CD-Rom is also being updated for professionals in the field and will be available for purchase soon.

Washington, D.C. - February 11, 2005

The Department of Housing and Urban Development (HUD) today released income limits for 2005, effective February 11, 2005. Click here for links to median family income, income limits and accompanying information and tables from HUD. Novogradac & Company LLP is also currently updating its Rent & Income Limit Calculator© to include 2005 data.

Sacramento, Calif. - February 9, 2005

The California Tax Credit Allocation Committee (TCAC) this week published a fourth draft of its regulations for the administration of the low-income housing tax credit (LIHTC) program in 2005. Click here for a copy of the regulations and a corresponding memo regarding the latest round of changes.

Novogradac & Company LLP will present two LIHTC application workshops in Sacramento on February 24 and Los Angeles on February 25 featuring TCAC Executive Director Lynn Wehrli as a guest speaker.

Washington, D.C. - February 7, 2005

In his federal budget request released today, President George W. Bush proposes $28.5 billion in funding for the U.S. Department of Housing and Urban Development (HUD) in 2006 – a cut of 11 percent from 2005. The budget request includes several proposals for reform of major programs, including modifying the Housing Choice Voucher program. In addition, Bush proposes $3.7 billion for a new economic and community development program within the Department of Commerce. The Strengthening America's Communities Grant Program would consolidate 18 programs that have been dubbed “ineffective or duplicative” by the White House Office of Management and Budget's (OMB) Program Assessment Rating Tool (PART) - programs such as Community Development Block Grants - into a single, unified grant program. Also, the budget again proposes a Single Family Homeownership Tax Credit for developers of affordable for-sale housing.

Colombus, Ohio - February 3, 2005

Gov. Bob Taft this week signed Amended Substitute House Bill 431, making the Ohio Housing Finance Agency (OHFA) an independent entity, effective July 1, 2005. Established in 1983 by the Ohio Legislature, OHFA is currently a division of the Ohio Department of Development (ODOD). The agency is expected to enhance many of its programs and to continue to offer its other primary programs, including the mortgage revenue bond program; the Ohio Housing Trust Fund; federal low-income housing tax credits (LIHTCs); multi-family bonds and loan programs; and rental assistance for tenants through the Section 8 program.

Washington, D.C. - February 1, 2005

The Internal Revenue Service (IRS) this week published Notice 2005-17 granting an extension of time of the transitional relief provided in Notice 2004-80 for material advisors to comply with the new filing requirements under Section 6111. General partners and/or developers of low-income housing tax credit (LIHTC), historic rehabilitation or new markets tax credit (NMTC) partnerships or properties that closed AFTER October 22, 2004, may have a filing requirement as a material advisor. The penalties for non-compliance can be very severe, so parties involved with partnership closings after October 22, 2004 are urged to read Notices 2004-80 and 2005-17.

January

Sacramento, Calif. - January 31, 2005

The California Housing Finance Agency (CHFA), the Department of Housing and Community Development (DHCD), the California Tax Credit Allocation Committee (TCAC) and the California Debt Limit Allocation Committee (CDLAC) announced last week that they are working together to streamline the application process for developers requesting loans, low-income housing tax credits (LIHTCs) and/or tax-exempt private activity bonds for affordable housing developments in California. The agencies' goal is to create a universal application that would contain project information related to the development team and contact information; each housing agency would also require a supplement to the universal application that would address individual underwriting or program requirements. The agencies are soliciting input from the public concerning how the universal application should be structured. Written comments will be accepted until February 11, 2005. Click here for additional information.

TCAC also released an updated LIHTC allocation schedule for 2005.

Sacramento, Calif. - January 27, 2005

In order to allow more time for review, the California Tax Credit Allocation Committee (TCAC) decided yesterday to defer adoption of the revised 2005 low-income housing tax credit (LIHTC) program regulations, now in the third draft version, until its meeting scheduled for February 16, 2005. TCAC will continue to accept public comments on the final draft until February 4. In a letter posted today, TCAC Executive Director Lynn Wehrli encourages interested parties to limit comments generally to the areas of the regulations already under discussion, primarily changes made in the third draft, and not to add new issues that would merit additional hearings or that would alter upcoming applications. Click here for more information.

Washington, D.C. - January 26, 2005

Through its rental housing assistance programs, the U.S. Department of Housing and Urban Development (HUD) manages $56 billion in insured mortgages and provides about $19 billion in rental subsidies annually, according to the Government Accountability Office (GAO). To accomplish this, HUD relies on thousands of intermediaries, including lenders, appraisers, property management contractors, public housing agencies, and multifamily property owners. Historically, GAO has cited weaknesses in HUD's oversight of these entities as factors that have made the programs vulnerable to fraud, waste and abuse. In 2001, GAO designated HUD's single-family mortgage insurance and rental housing assistance programs as high risk and in a report released this week cites significant weaknesses that persist in these areas. Click here for more information.

Washington, D.C. - January 25, 2005

The Department of the Treasury and the Internal Revenue Service (IRS), as part of a continuing effort to reduce paperwork and respondent burden, today invited public comments concerning Form 8609, Low-Income Housing Credit Allocation Certification and Schedule A (Form 8609), Annual Statement. Owners of residential low-income rental buildings may claim a low-income housing tax credit (LIHTC) over a 10-year credit period for each qualified building. Form 8609 is used to obtain an LIHTC allocation from the housing credit agency. The form, along with Schedule A, is used by the owner to certify necessary information required by the law. There are no changes being made to Form 8609 or Schedule A at this time. Written comments should be received on or before March 28, 2005. Click here for more information.

Sacramento, Calif. - January 21, 2005

The California Tax Credit Allocation Committee (TCAC) today posted a second draft of its regulations for the 2005 low-income housing tax credit (LIHTC) program year. In a letter, also posted today, TCAC Executive Director Lynn Wehrli says the new draft integrates many of the recommendations submitted by the public during the comment period on the first draft. Click here for more information.

Washington, D.C. - January 21, 2005

The adjusted basic FHA multifamily mortgage limits for calendar year 2005 have been increased by 2.29 percent over the 2004 level according to a notice published today by the U.S. Department of Housing and Urban Development (HUD).

Washington, D.C. - January 20, 2005

The Rural Housing Service (RHS) this week published a final rule amending its regulations for the Guaranteed Rural Rental Housing Program (GRRHP). Under the GRRHP, RHS guarantees loans for the development of housing and related facilities for low- or moderate-income families in rural areas. The amendments allow RHS, in the case of a default, to buy back guaranteed loans from investors, lower the minimum level of rehabilitation work when guaranteed loans are used for acquisition and rehabilitation, and clarify certain matters involving Ginnie Mae. RHS says the goal of these regulatory changes is to increase participation by the secondary mortgage market in the GRRHP. Click here for the final regulations, which become effective February 18, 2005.

Washington, D.C. - January 19, 2005

The U.S. Department of Housing and Urban Development (HUD) this week published a notice making correcting two technical errors in the November 30, 2004 notice designating difficult development areas (DDAs) for purposes of the low-income housing tax credit (LIHTC). Click here for details.

Washington, D.C. - January 19, 2005

Transfers of 99 percent partnership interest do not count for purposes of determining whether at least 10 years elapsed between the acquisition of a building and the date the building was last placed in service, according to a recent private letter ruling released by the Internal Revenue Service. Click here for a copy of the ruling.

Raleigh, N.C. - January 18, 2005

The North Carolina Housing Finance Agency (NCHFA) has posted the criteria and requirements for its new Preservation Loan Program. NCHFA set aside $10 million of its federal HOME allocation to allow the rehabilitation and preservation of rental housing that is not able to utilize other resources. Owners of affordable housing who are interested are invited review the criteria and requirements to determine if their property will be eligible.

Washington, D.C. - January 14, 2005

The U.S. Department of Housing and Urban Development (HUD) today announced revised Annual Adjustment Factors (AAFs) for adjustment of Section 8 contract rents for specified programs in 2005. These factors apply to housing assistance payment contract anniversaries for calendar months commencing after the date of publication of this notice. The AAFs are based on residential rent and utilities time-series cost indices from the Bureau of Labor Statistics' Consumer Price Index (CPI) survey and from HUD's Random Digit Dialing (RDD) rent change surveys. The 2005 AAFs are effective today.

Austin, Texas - January 13, 2005

The Texas Department of Housing and Community Affairs (TDHCA) has posted the 2005 low-income housing tax credit (LIHTC) pre-application submissions log showing applicants self-scores. TDHCA received a total of 223 pre-applications proposing 24,768 units of housing, 24,086 of which would be targeted to low-income residents. Applicants requested a total of $156,565,590 in tax credits; Texas has an estimated $39,999,999 in LIHTC authority available to allocate in 2005. TDHCA is expected to post its scores of the pre-applications on Friday, January 28, 2005.

Washington, D.C. - January 10, 2005

The Internal Revenue Service (IRS) this week published bond factors for the period January through March 2005 in Revenue Ruling 2005-1. The monthly bond factor amounts are used in calculating the amount of bond considered satisfactory under §42(j)(6) of the Internal Revenue Code or the amount of U.S. Treasury securities to pledge in a Treasury Direct Account for taxpayers that dispose of qualified low-income buildings or interests therein.

Washington, D.C. - January 6, 2005

The Affordable Housing Tax Credit Coalition (AHTCC), along with other members of the affordable housing industry, is concerned with the numerous tax reform proposals currently being discussed on Capitol Hill and at the White House. Several of the proposals, including a value added tax (VAT) and national sales tax (in place of an income tax) could have a negative impact on the value of tax preferences, including the low-income housing tax credit (LITHC). If the LIHTC is devalued, a significant gap in funding for affordable housing could go unmet. Throughout the coming months, members of the AHTCC will be meeting with members of Congress to discuss the importance of the LIHTC program and the potential impact of various tax proposals on this important program. The AHTCC encourages others to seek meetings with their congressional representatives and is happy to provide contact and other information as necessary. For more information, contact Francine Friedman at ffriedman@hunton.com or visit the AHTCC web site: www.taxcreditcoalition.org.

Honolulu - January 4, 2005

Gov. Linda Lingle this week presented to the Hawai`i State Legislature a report prepared by the Affordable Housing Task Force outlining specific recommendations for short- and long-term solutions to Hawai`i's affordable housing shortage, including providing two to three times more low-income housing tax credits (LIHTCs) to developers who build affordable rental housing. Click here for a copy of the complete report.

Washington, D.C. - January 3, 2005

Changing the definition of “rural” might allow the Rural Housing Service (RHS) to treat communities with similar characteristics more consistently, according to the U.S. Government Accountability Office (GAO). GAO today published a report with three suggestions for congressional consideration that it suggests could improve eligibility determinations for RHS programs: (1) eliminating the metropolitan statistical area (MSA) criterion and recommending that RHS use density measures as a basis for its eligibility decisions, (2) phasing out the practice of “grandfathering” communities that experienced changes in eligibility because of inclusion in an MSA, and (3) eliminating the “lack of credit” requirement. Click here for a copy of GAO's complete report.