QAP Drafting Considerations (post 9 of 10)

Published by Mark Shelburne on Wednesday, September 22, 2021 - 12:00am

This post is part of a series on QAPs:

  1. Introduction
  2. Set-Asides
  3. Thresholds
  4. Selection Criteria
  5. Underwriting
  6. Creating a Competition
  7. Special Case of Cost Policies
  8. 114 Different Criteria
  9. Drafting Considerations
  10. Providing Effective Input

When drafting qualified allocation plans (QAPs) two general concepts should guide the way:

  • Keep everything as brief as possible. If something is unnecessary, it’s in the way. Treat the words in the QAP like a hiker deciding what goes in a backpack.
  • Remember that QAPs are effectively an extension of Internal Revenue Code Section 42. Think of them as containing nothing more or less than a statute. As such they need a certain level of formality and discipline.

What Not To Include

QAPs should leave out the content described below.

1. The same rule more than once

Repetition can accidentally result in being inconsistent (i.e., making a change in one place but forgetting to do so in another). This principle is especially necessary between different documents. Instead, if something must appear in multiple places, incorporate it by reference.

2. Rules that don't fit the section heading

Anyone should be able to scan a table of contents and know where to find what’s important in a particular situation.

3. Rules in unexpected locations

A variation of the above, examples include definitions and checklists.

4. Passive voice

Even when obvious, QAPs should specifically identify which party is taking an action.

5. Section 42 or IRS regulations

Now that we’re beyond the 30th anniversary of enactment, program participants should know federal law or how to look it up. Instead of restating the Internal Revenue Code, where necessary use references to subsections. Furthermore, Congress and the Internal Revenue Service can make changes suddenly and unpredictably.

6. Terms appearing later

Including in the QAP content that also appears in reservation letters, carryover agreements, and other similar documents risks inconsistency and limits the ability to adapt for unique circumstances. An exception is giving advance notice (fair warning) of unexpected, non-typical provisions.

7. Specifics of internal processes

Those outside the agency do not need to know which divisions or positions carry out certain functions (e.g., who reviews application attachments). Furthermore, the responsibilities might change during a cycle.

8. Justifications, rationales and explanations

Remember, the QAP is basically a law. The reasons behind the rules could go in a distinct location. Even less necessary are broad statements about agency goals, principles, etc.

9. Unclear or inconsistent outline hierarchy

Section numbers help readers understand the content. A document should not have a II(A)(3) and III(b)(iv). Even worse is when a reference would apply to two different places.

No one system is the best, but it ought to be clear and consistent. Here’s a common setup:

        I.

                A.

                        1.

                                (a)

                                        (i)

Each level must have at least two entries, as in no (A) or (1) without a (B) or (2). Usually at least the top two have verbal headings. Bullet points work anywhere, and are preferable for short phrases when it won’t be necessary to make a reference to the specific item.

10. Lengthy paragraphs

Any paragraph with more than 10 lines is suspect, and none should be more than 20. Once a paragraph gets that long, odds are the concepts can be in separate outline levels.

11. The words encourage, recommend or suggest

Something is a requirement, or not. Advice and technical assistance should be in a separate document.

12. The phrase “reserves the right”

This phrase is simultaneously legalistic and unclear (reserving from what?). The word "may” works just as well (e.g., “the agency may disqualify an application”).

Conclusion

Avoiding the items listed above goes a long way towards making QAPs understandable, which is fundamental for all parties. Comprehension is a necessary (although not sufficient) condition of complying with the rules.

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