Novogradac Journal of Tax Credits Volume 8 Issue 12
The December 2017 issue of the Novogradac Journal of Tax Credits.
Thirty-five states have their own historic tax credit (HTC) programs. That number has fluctuated year-to-year over the past three decades. In the structure of these programs, there has been much experimentation with different ways to meet various policy preferences and fiscal goals. State HTCs live or die by tough state budgetary decisions and the overall success of that state’s program as understood by state legislators, including additional incentives that are derived from the federal program.
It’s not often that a single development receives $170 million in low-income housing tax credit (LIHTC) equity.
Question: When structuring a historic tax credit (HTC) transaction, what considerations should be taken into account when a lessee is a tax-exempt entity?
The new markets tax credit (NMTC) and historic tax credit (HTC) are twins who spent a few years apart and are now together again.
In the wake of Hurricanes Harvey, Maria and Irma, the affordable housing community quickly rallied to make sure that individuals and families affected by the disasters have a safe and affordable place to live, both for the immediate time and in the long term.
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Construction for a $34 million business incubator, The Hatchery, broke ground Oct. 24 on Chicago’s west side. The 67,000-square-foot facility will help local food and beverage entrepreneurs start on the road to success. The facility is anticipated to create approximately 150 jobs in its first year. The Hatchery is scheduled for completion in 2018 and will provide space for 56 kitchens and room for approximately 75 to 100 food industry entrepreneurs. There will also be seminars, workshops and one-on-one business consulting. Financing for development includes $8.5 million in new markets tax credits (NMTCs).
The Renewable Electricity Tax Credit Equalization Act (H.R. 4137) was introduced by Rep. Elise Stefanik, R-N.Y., Oct. 25. The bill would amend the Internal Revenue Code of 1986 to modify the credit for electricity produced from certain renewable resources and the investment credit for open-loop biomass, closed-loop biomass, hydropower, geothermal and waste-to-energy technologies.
In response to the state’s recently enacted budget, the Wisconsin Housing and Economic Development Authority released Oct. 2 a provision that will limit state historic preservation tax credit (HTC) awards to no more than $500,000 per property beginning July 1, 2018. The guidance applies to 2018 low-income housing tax credit (LIHTC) applications, which also use the state HTC program. Applicants may include state HTC equity as a funding source and may request financial participation points for the equity resulting from the state HTC. The guidance is available at www.taxcredithousing.com. WHEDA stated that this new limit may impact LIHTC applications submitted for the 2018 LIHTC cycle. The 2018 LIHTC application deadline is Dec. 8.
The U.S. Housing and Urban Development (HUD) announced Oct. 19 federal disaster assistance to California in the wake of wildfires. President Donald Trump issued a major disaster declaration for Butte, Lake, Mendocino, Napa, Nevada, Orange, Sonoma and Yuba counties, allowing HUD to offer foreclosure relief and other assistance to certain families living in these counties. HUD granted immediate foreclosure relief, offered forbearance and loan modification options, made mortgage insurance available, made insurance available for both mortgages and home rehabilitation and shared information with the Federal Emergency Management Agency and the state on housing providers that may have available units in the impacted counties.
The California Tax Credit Allocation Committee (CTCAC) released Oct. 13 a new lease rider template. The template incorporates many suggestions CTCAC received over the course of the past several months. For developments that received a tax credit reservation in 2017 or later, CTCAC does not intend to negotiate the language further for individual developments. The red-lined version was also made available to reflect changes made in June. The lease rider template is available at www.taxcredithousing.com.