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LIHTC Nuts & Bolts. The Application and the QAP. The QAP. Virginia Housing Development Authority prepares, annually, a Qualified Allocation Plan, or QAP, which governs Virginia ’ s Low-Income Housing Tax Credit program.
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LIHTC Nuts & Bolts The Application and the QAP
The QAP • Virginia Housing Development Authority prepares, annually, a Qualified Allocation Plan, or QAP, which governs Virginia’s Low-Income Housing Tax Credit program. • VHDA is required to provide opportunities for public input into the development of the annual QAP: • Earlier today, VHDA held the 2015 QAP Focus Group meeting. • The 2015 QAP Public Hearing will be held on September 18, 2014 and VHDA will continue to accept public comments through this date. • The VHDA Board is scheduled to approve the 2015 QAP on October 1, 2014.
The QAP • Please see the 2015 draft QAP. • This QAP will establish guidelines and priorities for the use of Low-Income Housing Tax Credits in 2015, including,for 9% applications: • Credit pools; • Cost limits; • Program priorities; and, • Credit allocation process. • QAP also provides information on credits for projects supported by tax-exempt bonds (4% credits).
The QAP • Proposed credit pools: • Nonprofit Pool – 15% • Local Housing Authority Pool – 15% • NOVA New Construction Pool – 15% • NOVA Pool – 18.02% • Northwest / North Central Pool – 9.20% • Richmond MSA Pool – 11.63% • Tidewater MSA Pool – 17.00% • Balance of State – 14.15% • Amount of total credits to be determined by VHDA – may mirror credit amounts from 2014 - $14 million. • Credit amount adjusted by pre-allocations to prior years (including to Noncompetitive pools), by returned credits, and by credits available from a National pool.
The QAP • Nonprofit-sponsored applications compete, first, in the Nonprofit pool and, if unsuccessful in securing credits, then compete in the geographic pools. • LHA applications complete only in the LHA pool and do not compete in the geographic pools. • Applications targeted for partial funding within the geographic pools are placed in the Tier One At-Large pool and are, among the projects not safely funded, the most likely to be funded if additional credits are allocated by VHDA. • Projects not funded in the geographic pools are placed in the Tier Two At-Large pool and are generally not funded. • See 2014 Final Rankings.
The QAP • Set-Asides within the Virginia program: • The Nonprofit Pool • The Local Housing Authority Pool • Developments for Persons with Disabilities • Annual non-competitive pool of up to 6% of Virginia’s annual credit amount. • Reserved from the following year’s allocation.
The QAP • VHDA has established cost limits for total development costs which, if exceeded by a project, would disqualify the project for credits: • Inner Northern Virginia – • New construction or adaptive reuse - $335,475 / unit (with additional $37,275 for underground or structured parking for each unit) • Rehabilitation - $292,875 / unit • Outer Northern Virginia – • New construction or adaptive reuse - $249,210 / unit • Rehabilitation - $175,725 / unit • Remainder of Virginia – • New construction or adaptive reuse - $186,375 / unit • Rehabilitation - $143,775 / unit
The QAP • Virginia program priorities: • Cost containment – beyond the cost limits, projects that cost less and use fewer credits are preferred. • Geographic priorities: • Discouraging construction of new apartments in no growth localities. • Basis boost for QCT and DDA. • Incentive for projects targeted for census tracts with low poverty rates and no other LIHTC projects. • Experience and readiness – preference for developers with a history of utilizing Low-Income Housing Tax Credits or for developments, promoted by experienced developers or not, that have approved development plans. • Green building – reward projects that secure “green” construction certifications – EarthCraft or LEED primarily.
The QAP • Virginia program priorities: • Accessibility • Limit on elderly projects • Deeper income and rent targeting • Funding commitments – local funding and subsidized sources • Amenities
LIHTC – A PrimerThe Virginia Program • IMPORTANT DATES • 01/28/2015- CEO notification letter info must be submitted online to VHDA BY 2:00PM (Failure to submit will result in a 50 point penalty). • 03/06/2015-Application for Reservation and Market Study deadline
LIHTC – A PrimerThe Virginia Program • IMPORTANT DATES • 04/01/2015- CEO support letter deadline • 05/05/2015-Preliminary Rankings • 05/29/2015-Announcement of final rankings
