1 / 12

Avoiding Technical Corrections 2012-2013 Qualified Allocation Plan Forum September 5, 2012

Avoiding Technical Corrections 2012-2013 Qualified Allocation Plan Forum September 5, 2012. Avoiding Technical Corrections. Overview 67 developments applied for tax credits in the 2012 Round 14 projects were awarded credits

ilario
Download Presentation

Avoiding Technical Corrections 2012-2013 Qualified Allocation Plan Forum September 5, 2012

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Avoiding Technical Corrections 2012-2013 Qualified Allocation Plan Forum September 5, 2012

  2. Avoiding Technical Corrections • Overview • 67 developments applied for tax credits in the 2012 Round • 14 projects were awarded credits • Importance of maximizing points – 4 points could be the difference between getting an award or not!

  3. Avoiding Technical Corrections • Common Technical Corrections • Financial statements from principals – don’t leave anyone out • Site plan does not include placement of accessible units • Units plans do not have square footage • Affidavits missing from development team members (see Form A, pages 21-22) • Exceeding fee limitations (i.e. architect, contractor) • Phase 1 does not include FEMA floodplain map and wetlands map

  4. Avoiding Technical Corrections • “Silly” Technical Corrections • Lender Letter of Interest – lacking the required language • Not submitting the supplemental application fee for HOME or Development Fund - $500 for each • Missing a signature (i.e. Form C, Form K) • Missing a form (i.e. Form K) • Submitting documents more than 6 months old (dated • before May 1, 2012) • Making assumptions (i.e. no need for CNA) • Copy and paste – wrong development name • Document filed/saved in the wrong folder

  5. Avoiding Technical Corrections • Underwriting Technical Corrections • DOUBLE CHECK CALCULATIONS!! • Operating Reserves - between four to six months (Operating Expense plus debt service) or $1,500/unit (whichever is greater).  • Replacement Reserve minimum contributions must be used: • Rehabilitation: $350 per unit per year • New Construction: $250 per unit per year • Single Family Units: $420 per unit per year • Historic Rehabilitation: $420 per unit per year • Replacement Reserves must escalate at a rate of 3% per year.

  6. Avoiding Technical Corrections • Underwriting Technical Corrections • Rental Income Growth – 0-2% per year. • Operating Expense Growth – 1-3% per year. IHCDA requires operating expense growth to be at least 1% higher than rental income growth. • Management Fee maximum - 5-7% of “effective gross income” (gross income for all units less Vacancy Rate). • If outside of IHCDA guidelines, please • provide explanation!!

  7. Avoiding Technical Corrections • All applicants will be required to use a 20% basis boost • and 9% to calculate the maximum 9% credit request. • 20% basis boost to be utilized for Scoring Criteria Credit Reduction Section G.4(b). • Reservation letters will designate a 30% basis boost. This is to ensure adequate basis to support credits awarded, in the event of the loss of the 9% flat rate. • ----------------------------------------------------------------------------------------- • New 3rd Party Market Study Reviewer • Ribbon Demographics & M.E. Shay & Co. • Submit all items listed on Market Study • Checklist

  8. Avoiding Technical Corrections • Scoring Pitfalls to Avoid • All maps need to clearly show the project site • Map of nearby amenities must have ¼ and ½ mile radius • All forms must be signed and dated by all necessary parties • Redevelopment plans must show evidence of community participation and input • Credit reduction calculated correctly • Unique features – don’t be modest!

  9. Avoiding Technical Corrections • General Reminders • Follow the submission guidelines in Schedule G • Form C due to IHCDA by October 1st • Applications due by 5:00 PM in the IHCDA office on Thursday, November 1, 2012 • Semi-Annual Progress Reports – If pending 8609, these are due by 12/31/12

  10. Avoiding Technical Corrections • 2013A-C Tentative Timeline • November 5, 2012 – Applicant list posted on the website • 3rd Week of November – IHCDA will notify the highest elected official of the local jurisdiction of tax credit applications • 1st Week of December – CNA report completed and provided to the applicant • 1st Week of January – Notification of Technical Corrections and any concerns regarding • Market Studies

  11. Avoiding Technical Corrections • 2013A-C Tentative Timeline - Continued • 4th Week of January – Issuance of Preliminary Score Sheets • February 28, 2013 – Recommendations made to IHCDA Board of Directors • March 28, 2013 – Reservation fees due for awarded developments

  12. Avoiding Technical Corrections • Thank You and Good Luck! • Indiana Housing and Community Development Authority • 30 S. Meridian Street, Suite 1000 • Indianapolis, IN 46204 • (317) 232-7777

More Related