QUALIFIED ALLOCATION PLAN AND PROCEDURES (QAP)

OVERVIEW SESSION

SEPTEMBER 18, 2015

2015 LOW-INCOME HOUSING TAX CREDIT (LIHTC) PROGRAM

• Commitments up to $50 million

• DOH review to occur simultaneously with CHFA review of ConApp

DOH Gap Funding

DOH Gap Funding Soft Commitment

Minimum Criteria:

• Demonstrated Marketability

• Appropriate Location

• No Feasibility Issues

• Ready to Proceed

DOH Gap Funding Priorities

Guidance on DOH Website

• Cascading Criteria:

High Opportunity

Mixed Income

Mixed Use

• Cascading DOH Cap:

$5 or $6MM

30% -33% of TDC

DOH RAP Commitments

Availability of RAP Vouchers

• Available for SSHP projects only

• Must submit description of request and RAP Analysis Worksheet to Helen Muniz (DOH) in advance of deadline

Qualified Allocation Plan (QAP) & Procedures

• January 2015 - CHFA’s Board of Directors convened Task Force

• May 2015 - Proposed amendments to the QAP and LIHTC Procedures

• May 2015 - Board approved publication of amended documents for public comment

Background

• July 2015 - CHFA’s Board of Directors

approved amended QAP and LIHTC

Procedures

• August 2015 - Governor signed

• LIHTC Procedures streamlined

• Operational language moved to

Guideline

Background

• Eliminated the Exceptional Priority classification

• Re-aligned the Application Criteria and points to the state’s policies

• Aligned points with priorities, making threshold any that no longer served as incentives

Amended QAP

• Historic, Adaptive Re-Use and Brownfield development – returned to 2 points

• Women and Minority Participation – returned to 2 points

• Statutory references are clarified with a full description

Amended QAP from Public Comments

• Two Classifications only: 50 / 50 split - State and Federal Public Housing and General Class

• New Preference within Public Housing Classification:

Tie-Breaker Preference for State Sponsored Housing Portfolio (“SSHP”) developments

Classifications and Preferences

• Set Aside remains within the General Class - One new construction family development in a municipality listed on the Housing Appeal Procedure List where there is less than 10% assisted and deed-restricted housing

QAP – Set-asides

• A minimum of 20% of the units in the development for Households 25% to 50% AMI

• Length of Extended Low Income Housing Commitment

• 40% Building Plans and Specs

• Affordability Profile

Amended QAP – New Threshold Items

• Housing for Veterans (outside of supportive housing) – 2 points

• SSHP Developments with Critical Needs 2018 or sooner – 2 additional points

New Points Items

• Length of ELIHC – Minus 4 points

• Affordability Profile – Minus 3 points

• Experience of Property Manager – Minus 2

points

• CDBG-DR Additional Points – Minus 3

points

Points Items Removed

Scoring

Maximum Points reduced to 102

Priority Points

Rental Affordability 37 points

Financial Sustainability 23 points

Municipal Commitment and Impact 29 points

Qualifications and Experience 11 points

SSHP Developments – Additional Points 2 points

Total 102 points

• All Applicants for 9% LIHTCs must apply during the funding round

• Applications for 2015 are due no later than 4:00 pm on November 9, 2015

• There will be a deficiency period – there are threshold items now that were not in place before – do not rely on the deficiency period

• Announcements anticipated at March

2016 Board meeting

Process

LIHTC Underwriting Guidance

• Funding Commitments must be firm for points consideration

• Municipal Commitments should be firm and quantifiable over 20 years

• Appropriate Organizational Documents for Applicant and Co-Sponsor

• Qualified Development Team Members

must be licensed in CT

have sufficient LIHTC experience

be selected through a justified process

LIHTC Underwriting Guidance

Items often missing that must be provided:

• HUD Involvement Letter required if Section 8 development

• Correct financing terms in Sources and Uses and Cash Flow Schedule exhibits

• Attestment Letters confirming tax credit basis

Caution: Items missing related to points only will not be noted in the deficiency letter

Other Related Updates

Multifamily Procedures, LIHTC Procedures, Guidelines, Glossary, Policy Statements

• Revised Developer Fee Schedule

• Construction Contingency & Basis

• Appraisals for LIHTC-only deals

• Eligibility Policy

• CHFA review prior to submission for high cost/waiver transactions

• Annual Distributions

• Syndicator Approvals

Technical Services Guidance

• Scope of work described in narrative should match information on drawings/specs/construction costs

• Exploded Trade Breakdown and Project Cost Summary

• Include Prevailing Wages or Federal Davis Bacon if applicable and DOL wage rate sheets

• General Requirements 9% max, OH&P 7% max

• Construction contingency typically 10%

• No points awarded for 40% drawings/specs; only 90% and above

• Any energy efficient measures should be included in drawings/specs and construction costs

• Building GSF etc should be noted on drawings in tabular format provided in ConApp

Technical Services Guidance

• Environmental abatement costs noted in reports should be included in the Environmental line item on PCS and ETPB

• If Phase I ESA recommends additional testing, this testing should be done, additional report included in application submission and all remediation costs included

• Radon testing is needed for existing buildings; for new construction, a radon mitigation system should be included in drawings/specs and construction costs

Technical Services Guidance

Contact Information

Chris Polek christopher.polek@chfa.org Consolidated Application and SharePoint process

Ed LaChance edward.lachance@ct.gov Consolidated Application and DOH Gap Funding

Helen Muniz helen.muniz@ct.gov DOH Rental Assistance (RAP) and SSHP Developments

Joe Voccio joe.voccio@chfa.org LIHTC Program and Financing

Terry Nash terry.nash@chfa.org QAP, Procedures and Guidelines

Jennifer Landau jennifer.landau@chfa.org Technical Services Requirements / Plans, Specs, Environmental, etc.

Steve DiLella steve.dilella@ct.gov Rental Assistance / Supportive Housing

John Dunne john.dunne@csh.org Supportive Housing Technical Assistance