109.04.08 Ark. Code R. 002
The Arkansas Development Finance Authority ("ADFA" or the "Authority") is charged with the responsibility of administering federal low-income housing tax credits ("Housing Credits") for the State of Arkansas (the "State"). ADFA is also charged with the responsibility of promulgating rules and regulations concerning the allocation of the Arkansas low-income housing tax credit (the "State Housing Credits") pursuant to Ark. Code Ann. § 26-51-1701et seq. The Tax Reform Act of 1986 created the Housing Credit to encourage the private sector to invest in the construction and rehabilitation of rental housing for low and moderate-income individuals and families. Section 42 of the Internal Revenue Code of 1986, as amended ("IRC" or the "Code"), mandates that housing credit agencies adopt a Qualified Allocation Plan ("QAP") for allocation of the Housing Credit to low-income rental developments throughout their respective states. Low-income housing tax credits shall be allocated in accordance with this plan or any amendments thereto.
The Code requires that ADFA determine "the [Housing Credit] dollar amount allocated to the development will not exceed the amount the housing credit agency determines is necessary for the financial feasibility of the development and its viability as a qualified low-income housing development throughout the credit period." Housing Credits will be limited to the amount the Authority, in its sole discretion, deems necessary. Housing Credits are not intended to provide the primary or principal source of financing for a development, but are intended to provide financial incentives sufficient to fill "gaps" which would otherwise exist in developing affordable rental housing for low-income households.
The base amount of annual credit authority is currently calculated at $2.20 per capita. This per capita amount is based upon population estimates released each year by the Internal Revenue Service.
The maximum amount of Housing Credits that may be reserved for allocation to one individual development shall be no more than $450,000 of the annual Housing Credits available in the calendar year. HOWEVER, the maximum amount of Housing Credits that may be reserved for allocation to one individual development:
If allowed by federal law, development owners, including those receiving allocations prior to July 30, 2008, whose new buildings are not federally subsidized and will be placing in service between July 30, 2008 and December 31, 2013, that elected to lock-in the credit percentage at a rate less than nine percent (9%) may request the Authority in writing to rescind such election. If allowed by federal law, the Authority will automatically approve of the rescission; however, owners will receive no federal low-income housing tax credits in excess of the amount previously allocated for the construction or rehabilitation of the development.
Ark. Code Ann. § 26-51-1702 provides that a taxpayer owning an interest in a low-income development qualifying for Housing Credits will be eligible for State Housing Credits equal to twenty percent (20%) of the allocated federal amount. The State statute limits the allocation of State Housing Credits to $250,000 in any one taxable year. Recognizing the limited availability of the State Housing Credits and with a desire to assign those credits where they are most needed, the applicant shall demonstrate need on the Housing Credit application. Based on demonstrated need in the application, the Authority will give a priority allocation of State Housing Credits to those developments that are in designated low-income counties under the State's Consolidated Plan submitted to the federal Department of Housing and Urban Development. The list of these counties is contained in Points Criterion #1 of this Qualified Allocation Plan. The allocation of State Housing Credits will be as follows:
The Authority will annually notify the Arkansas Department of Finance and Administration of those developments that have been allocated State Housing Credits. The Arkansas Department of Finance and Administration will be notified of any revocation of State Housing Credits.
The Affordable Neighborhood Housing Tax Credit Act of 1997, (the "ANHTC Act"), codified at Ark. Code Ann. § 15-5-1301et seq., provides that any business firm engaging in the provision of affordable housing assistance activities in the State of Arkansas may be entitled to receive Affordable Neighborhood Housing Tax Credits ("ANHTCs"). "Affordable housing assistance activities" is defined to include any "money, real, or personal property expended or devoted to the construction or rehabilitation of affordable housing units developed by or in conjunction with any governmental unit or not-for-profit corporation." The ANHTC Act limits the total allocation of ANHTCs to $750,000 in any taxable year.
The Authority and the Arkansas Department of Finance and Administration have determined that, in the best interest of affordable housing in Arkansas, "affordable housing assistance activities" must be devoted to those low-income housing developments which qualify for Housing Tax Credits pursuant to Section 42 of the Internal Revenue Code through the Authority's federal low-income housing tax credit or tax-exempt bond programs for residential rental housing. Thus, any business firm seeking allocation of ANHTCs must do so in conjunction with an application for federal low-income housing tax credits or tax-exempt bonds to develop affordable housing units by or in conjunction with any governmental unit or not-for-profit corporation.
A proposal for ANHTCs must be submitted with a Multi-Family Housing Application for federal low-income housing tax credits. In its Multi-Family Housing Application for federal low-income housing tax credits, the applicant will include a commitment from each business firm providing "affordable housing assistance activities" to the proposed low-income housing development. Each such commitment must:
* The ANHTC Act limits the amount of tax credits allowable to a business firm to thirty percent (30%) of the total amount invested. If the affordable housing assistance activity is other than money, the business firm must provide an appraisal certifying the value of the property invested.
If the business firm commits its "affordable housing assistance activities" to a governmental unit, a not-for-profit organization, or a "neighborhood organization", as defined within the ANHTC Act, which is not the applicant on the Multi-Family Housing Application, the applicant must submit with its Multi-Family Housing Application the following from such governmental unit, not-for-profit organization or "neighborhood organization":
For each proposal of "affordable housing assistance activities" submitted with a Multi-Family Housing Application, the applicant must certify in writing that it will expend or devote the "affordable housing assistance activities" committed to the construction or rehabilitation of affordable housing units within the development.
Based on demonstrated need in the Multi-Family Housing Application, the Authority will give a priority allocation of ANHTCs to those developments that are in designated low-income counties under the State's Consolidated Plan submitted to the federal Department of Housing and Urban Development. The list of these counties is contained in Points Criterion #1 of this Qualified Allocation Plan. The allocation of ANHTCs will be as follows:
The Authority will reserve and allocate ANHTCs in conjunction with its reservation and allocation or issuance of federal low-income housing tax credits. With its issuance of IRS Forms 8609 for federal low-income housing tax credits, the Authority will issue a Certificate of Allocation certifying the amount of ANHTCs allocated to the business firm entitled to such allocation. The Authority will annually provide the Arkansas Department of Finance and Administration with a copy of each Certificate of Allocation for ANHTCs allocated that year.
ADFA will reserve all Housing Credits available for allocation in one eligibility cycle. Credits that are not reserved will carry forward to the next year. Applicants shall apply during the eligibility cycle to receive a credit allocation for that calendar year.
The closing deadline for submitting the 2009 Multi-Family Housing Application for the 2009 Low-Income Housing Tax Credit ("LIHTC") Cycle is as follows :
APPLICATION DEADLINE IS FRIDAY, 4:30 P.M., FEBRUARY 6, 2009
("Application Deadline")
The applicant must use ADFA's online application provided at http://www.arkansas.gov/adfa/New Folder/authority publications.htm.A tabbed,
3 -ring bound hardcopy of the application plus all attachments and exhibits must be delivered to ADFA no later than 4:30 p.m., Friday, February 6, 2009. The tabbed, 3-ring bound hardcopy shall be delivered to ADFA at the following address:
Arkansas Development Finance Authority
Attn: Multi-Family Housing Department
423 Main Street, Suite 500
Little Rock, AR 72201
Or
P.O. Box 8023
Little Rock, Arkansas 72203-8023
Telephone Number: 501-682-5900
ADFA will not accept facsimile submissions.
In addition to the 3-ring bound hardcopy, the applicant must electronically submit the application as a saved (not scanned) ADOBE® file via e-mail to:
bbokony@adfa.state.ar.us.
Applications . Applications are reviewed for completeness as required in this QAP. Applications are scored based solely upon that information and documentation submitted in and with the application by the Application Deadline. Based upon that review, ADFA staff will provide the applicant with a written Notification of Deficiencies, including those Additional Requirements for a Complete Application pursuant to Section VI.C. of this QAP below and an Initial Score if the application has met all Threshold Requirements as set forth in Section VI.B. of this QAP below.
applications failing to meet all threshold requirements as set forth in section VI.B. of this QAP by
the Application Deadline will not receive an initial
score and will not be considered for an award of federal low-income housing tax credits.
Response Period. The Response Period will be from May 15, 2009 to 4:30 p.m. on May 22, 2009. During the Response Period, the applicant may contact ADFA staff regarding the written Notification of Deficiencies. NO CONTACT WITH ADFA BOARD MEMBERS IS ALLOWED AND ANY SUCH CONTACT WILL BE GROUNDS FOR IMMEDIATE DISQUALIFICATION OF AN APPLICATION . During the Response Period, the applicant will have an opportunity to submit:
Applicants will not be allowed to submit additional information or
documentation during the Response Period in an effort to increase the Initial
Score awarded by ADFA staff.
ADFA staff will review and evaluate the application, as submitted by the Application Deadline, and notify the applicant of deficiencies and scoring in accordance with the schedule below.
Dates for Review of Applications and Reservation Process | |
Application Deadline | February 6, 2009 (4:30 p.m.) |
Applicants sent Notification of Deficiencies and, if Applicable, an Initial Score | May 15, 2009 |
Response Period deadline for applicants to: 1) submit Additional Requirements for a Complete Application pursuant to Section VI.C. of this QAP; 2) discuss Initial Score awarded by ADFA; and 3) provide written comment | May 22, 2009 (4:30 p.m.) |
Applicants notified of Final Score | June 3, 2009 |
Successful applicants approved for reservation of Housing Credits by ADFA Board of Directors | June 18, 2009 |
2009 Housing Credit reservation letters mailed to successful applicants | July 1, 2009 |
The following Threshold Requirements must be met by the application deadline. Failure to meet these Threshold Requirements as set forth herein by the application deadline will terminate the application from consideration for federal low-income housing tax credits.
Applicant must submit written documentation from the utility allowance entity selected which clearly marks the allowance for each type utility usage applicable for each type of unit to be constructed. The supporting documentation must be signed and dated by an authorized representative of the utility allowance entity. Failure to have the utility allowance signed, dated and clearly marked by each type of utility usage applicable for each type of unit to be constructed will result in a rejection of the application. The utility allowance documentation must be dated within six (6) months prior to the Application Deadline. (Submit at MFHA, Tab #5)
Verification of Arm's Length Transactions shall be included. ADFA reserves the right to require an appraisal of the property for all Arms' Length Transactions, at the applicant's expense. (Submit all required site control documentation at MFHA, Tab #6)
For all acquisition/rehabilitationdevelopments, the application shall include documentation for each building claiming acquisition credits that:
In order to satisfy the "purchase requirement" of IRC Section 42(d)(2)(B)(i), the applicant must submit a copy of the Purchase Option/Contract/Agreement which sets forth the purchase price and the date of purchase. (Submit all required site control documentation at MFHA, Tab #6)
The applicant will be required to produce evidence of site ownership or a 99-year leasehold on the site at the earlier of:
ADFA reserves the right, in its sole and absolute discretion, to independently evaluate the need for additional affordable rental housing in the geographic market area.
In addition, to be considered for the "Non-Profit Set-Aside":
Multi-Family Housing Minimum Design Standards. Construction of the development must be in accordance with ADFA's "Multi-Family Housing Minimum Design Standards", as well as, all applicable local, state and national building codes. The applicant's architect must complete and execute the "Multi-Family Housing Minimum Design Standards Checklist", Attachment G of the MFHA. (Submit at MFHA, Tab #14)
A certification from the design architect or licensed engineer must be submitted with the application confirming that the proposed development will be constructed in:
For rehabilitation developments, if structural constraints prohibit adherence to ADFA's "Multi-Family Housing Minimum Design Standards", applicant may seek a waiver from ADFA for the standard concerned. Such waiver request must be in writing and include the following:
A certification from the design architect or licensed engineer will be required to be submitted confirming compliance with ADFA's "Multi-Family Housing Minimum Design Standards" prior to the issuance of IRS Form 8609. (Submit at MFHA, Tab #14)
A report, dated within six (6) months of the Application Deadline, of all components examined and analyzed in the assessment must be submitted with the application. The report must specifically identify the scope of work and estimated costs necessary to:
development to a new or "like-new" condition;
All rehabilitation development applicants must submit a statement that the scope of rehabilitation will include all areas set forth in the Capital Needs Assessment . (Submit at MFHA, Tab #16)
These amounts shall be incorporated into the 2009 Multi-Family Housing Application. The applicant shall identify the name of the financial institution where the funds will be held. (See MFHA, Section XIX)
The one-time funded Operating Reserve Fund must remain in place until such time as the development is ninety-five percent (95%) occupied.
Acquisition credits will be based upon the lesser of the purchase price for the buildings only or the appraised value of the buildings in the development.
"Net Development Costs" is defined as the total uses of funds, less syndication-related costs, developer's fee and development reserves.
The Authority may increase or "boost" the eligible basis of any development, not located in a designated qualified census tract or difficult to develop area, by up to thirty percent (30%) of such basis if it is determined that such increase is required in order for the development to meet the minimum debt coverage ratio of 1.10. The Multi-Family Housing Application must reflect that the terms of the development's financial sources are competitive with the market place. This subparagraph does not apply to developments financed with tax-exempt bonds
* Developments financed with tax-exempt bonds.
Applicants for tax-exempt bond financing subject to private activity volume cap may:
The following documentation, in addition to the Threshold Requirements as required in Section VI.B. of this QAP above, must be submitted in order for the application to be considered COMPLETE.
If the following documentation is not submitted by the application deadline, ADFA staff will notify the applicant of each deficiency. The applicant must submit the deficient documentation during the Response Period. Failure to submit the deficient documentation during the Response Period will terminate the application from consideration for federal low-income housing tax credits.
In addition, one (1) point will be deducted from the application score for each missing or incomplete document that is submitted during the Response Period in order for the application to be considered COMPLETE . Applicants will be notified of the point(s) deduction in the notification of the Final Score on June 3, 2009.
The applicant must submit a copy of the above notice with its application to the Authority. (MFHA, Tab #10)
"Minimum required experience" is met when either the applicant, consultant, or developer held that position on a previous development that received a reservation of Housing Credits from ADFA and whose owner was issued IRS Form 8609(s).
Capacity Standard. It is within ADFA's sole discretion to evaluate the capacity of any development team member to undertake performance on any development. A determination by ADFA that any development team member does not have the capacity to undertake performance on any development may result in a disqualification of the application. (MFHA, Tab #11)
In addition, ADFA will review the previous performance of the applicant, its consultant and each development team member under all affordable housing programs with ADFA or other State Housing Finance Authorities, including the HOME Program, the Housing Credit program, Tax-Exempt Bond program, and any other affordable housing loan program, including disbursements, payment history, compliance history and any findings. Unsatisfactory performance, as determined by ADFA's Board Housing Review Committee, on previous developments or delinquencies in payments will result in disqualification of an application by the ADFA Board Housing Review Committee, regardless of scoring.
An application will be disqualified from consideration as provided for in Section VIII.J, Criminal Background Check and Disclosure Requirements, of this QAP below. (MFHA, Tab #12)
ALL ASSISTED LIVING DEVELOPMENT APPLICATIONS MUST SUBMIT THE FOLLOWING REPRESENTATIONS FROM THE APPLICANT AT TAB #25 OF THE MFHA:
Each application will be awarded points based upon the Points Criteria outlined below. To be awarded points, the applicant must submit the information and documentation EXACTLY as stated below by the APPLICATION DEADLINE. Failure to submit the information exactly as required will result in no points for the point category and the applicant will be given no opportunity beyond the Application Deadline to submit the required information and documentation.
POINTS CRITERIA | MAXIMUM POINTS | |
1. | Location/RD/HUD. a. Development is located in the following low-income counties designated in the 2005-2009 State Consolidated Plan: Bradley, Chicot, Crittenden, Desha, Fulton, Jackson, Lafayette, Lee, Monroe, Newton, Phillips, Polk, St. Francis, Searcy, Sharp, Stone, and Woodruff.................................... (15 points) b. Development is located in a Qualified Census Tract (QCT) or a Difficult to Develop Area (DDA); a copy of QCT map for the development area shall be submitted with the application with complete census tract information submitted at Tab #24 of the MFHA . ............................... ..... (10 points) c. Development has a commitment letter for funding or assistance from USDA Rural Development or HUD. USDA-RD (i) USDA transfer funds commitment..... .............................. (5 points) (ii) USDA new construction or rehabilitation funds commitment..............................................................(5 points) (iii) USDA rental assistance contract................................ ..... (5 points)* (iv) USDA loan guarantee with interest credit buy down........ ........ (5 points) HUD (i) HUD project based rental assistance contract 11-20 years.....(10 points)*(ii) HUD project based rental assistance contract 6-10 years....... (7 points)*(iii) HUD project based rental assistance contract 1-5 years......... (3 points)*(iv) HUD loan guarantee with interest reduction payments........... (5 points) * Points are awarded based upon the percentage of units receiving rental assistance. Rental Assistance Contract must be submitted at Tab #29. | 15 |
2. 3. | Development of housing for special needs or with special features including: a. Single room occupancy housing; b. Transitional housing for the homeless; c. Elderly housing ( housing for older persons as defined at 42 USC 3607(b)(2) and Ark. Code Ann. § 16-123-307(d)(1)); d. Scattered site housing as defined in Section VIII.C. of this QAP below; e. Assisted Living housing as defined in Section VIII.D. of this QAP below; f. Supportive housing for disabled persons as defined in Section VIII.E. of this QAP below. (i) Applicant shall submit a statement: (a) describing the design and construction of the development that will meet the needs of the disabled population served; (b) describing the on-site support services that will meet the needs of the disabled population served; (c) indicating the supportive services will be optional to the disabled population served. (see 26 C.F.R. § 1.42-11(b)). (ii) The proposed service provider will submit a statement describing: (a) the disabled population to be served; (b) the needs of the disabled population to be served; and (c) the service, with the frequency of its provision, to be provided to the disabled population to be served. g. Housing for large families (3 bedrooms or larger); h. Housing that markets to a tenant population of single parent/single guardian with children; or i. Housing intended for eventual tenant ownership (single-family, detached units only) Items a & b must be operated by governmental or non-profit entity. Points for Items a - g D all of tax credit units for special needs .............................. (13 points) D half of the tax credit units ............................................. (8 points) D 10% of the tax credit units (minimum of three units)............... (4 points) Point for Item h -- housing whose majority of units consists of not less than 2 bedrooms and describes the manner in which such population will be marketed............................................................................. (1 point) (MFHA, Tab #23(a)) Point for Item i -- Pursuant to 26 U.S.C. § 42(i)(7), eventual tenant ownership when tenant exercises a right of first refusal after completion of Compliance Period. Applicant must submit proposed right of first refusal contract to be offered for eventual tenant ownership ................................. (1 point) | 15 |
Involves rehabilitation of existing structures. | 10 |
4. 5. 6. 7. | Involves rehabilitation of residential rental housing under an existing state or federal affordable housing program; or rehabilitation of structures that are individually listed in the National Register of Historic Places or have been determined to contribute to a Registered Historic District. If applicable, points are awarded based on the percentage of units under the affordable housing program that become LIHTC units. See Section VI.C.10. of this QAP above. | 10 |
Points will be available to applicants if their combined developer and consultant fees are 10% or less of net development cost as defined under developer fee standard. See Section VI.B.16. of this QAP above. Applicant must submit a statement of its election to limit its combined developer and consultant fees to 10% or less of net development costs and such limitation must be reflected in the MFHA's Development Costs, Section XXIV. (MFHA, Tab #23(c)) | 5 | |
A minimum of 20% of the total residential units in the development are market rate units. In order to receive an award of points, the market rate units must be evenly distributed throughout the buildings in the development, and if a single building, throughout the floor(s) of the building. The distribution of the market rate units must be reflected on the plans and Attachment E, Building and Unit Designation, submitted with the MFHA. (MFHA, Tab #14) | 5 | |
Owner provides amenities beyond those appropriate for the type of housing proposed, inter alia, amenities employing "universal design" concepts; swimming pool; covered parking; individual garage parking; individual storage units; microwave; dishwasher; supplied in-unit washer and dryer; furnished exercise room; furnished in-unit, high-speed, internet access at no cost to the tenant as evidenced by architectural plans and specifications; furnished computer lab with high speed internet access at no cost to the tenants as evidenced by architectural plans and specifications that shall be included in the application. Applicant must submit those amenities that will be included in the development at Tab #27 of the MFHA and they must be indicated on the plans and specifications. A signed certification from the design architect or licensed engineer confirming the installation of the amenities beyond those appropriate for the type of housing constructed will be required prior to the issuance of IRS Form 8609. The certification shall be included in the Allocation of Credits request made to the Authority. | 10 |
8. | Advance energy efficiency features . The applicant shall provide a statement that the design and/or components of the development promotes greater energy efficiency than required by ADFA's "Multi-Family Housing Minimum Design Standards." The statement shall be from a licensed engineer or architect certifying those energy-saving devices, beyond those required, that will be utilized in the construction of each Housing Credit unit. The advanced energy-saving devices utilized shall be certified by a licensed engineer or architect as included in each unit upon placement in service . (MFHA, Tab #21) a. Points will be awarded for those energy efficient features and systems that are "ENERGY STAR®" labeled. b. Points will be awarded for those energy components whose "R" or "U" rating exceeds that required under ADFA's "Multi-Family Housing Minimum Design Standards." A signed certification from the design architect or licensed engineer confirming the installation of the advanced energy saving devices will be required prior to the issuance of IRS Form 8609. The certification shall be included in the Allocation of Credits request made to the Authority. | 15 |
9. | Support services provided by tax-exempt organizations. a. An authorized official of each tax-exempt organization involved must provide a signed acknowledgement of participation describing the supportive services offered. In addition, the acknowledgement shall: (i) state that the organization's charter or by-laws authorize the service(s) to be provided; (ii) describe how the services provided are appropriate for the development's tenants; (iii) state that the services will be provided at no cost to the tenants; (iv) state that the services will be provided at least quarterly (once every three (3) months) at the development site. b. The applicant will submit a statement that: (i) quarterly notice of the proposed services will be provided to the tenants; (ii) a verification of the provision of the services, signed by representatives of the development and the service provider, will be maintained by the development owner; c. The applicant will submit a copy of the Articles of Incorporation/Charter and By-Laws of the tax-exempt organization that will be providing the support services. (MFHA,Tab#22) | 5 |
10. | Site Visit. The site location will be evaluated for accessibility and proximity to services appropriate to the type of housing proposed (e.g. grocery stores, schools, medical facilities, and public transportation). The application should identify the name, driving directions, and distance to the nearest grocery store, medical facility and pharmacy. Scoring consideration will also include, among other things, site suitability regarding topography (grade, low-lying area, flood plain, or wetlands); proximity to nuisances (e.g., railroad tracks, major highways/interstates; manufacturing/production plants) and environmental issues. | 10 |
11. | Market Need. A Market Study shall be submitted which adequately demonstrates need for the rental housing units proposed. Points will be awarded based upon 5% increments of the overall capture rate within the market area for the rental housing proposed. The maximum award of 15 points will be awarded when the overall capture rate is = 20%. The minimum award of 0 points will be awarded when the overall capture rate is 91% to 100%. Each bedroom size proposed, based upon the targeted income group, will receive a separate, weighted score based upon the maximum score of 15 points. The application will be rejected if the market study fails to show need for any bedroom size proposed based upon the targeted income group for that bedroom size ........................................ ................................................. (15 points) Bonus. The market study demonstrates that for the period January 1, 2009 to December 31, 2012, the primary market area will experience an increase of at least five percent (5%) in the number of low-income households appropriate for the development's configuration...(5 points) (See Section VI.B.7. of this QAP above for additional information regarding market study requirements.) (MFHA, Tab #8) | 20 |
12. 13. 14. | Serves the lowest income group possible. Special priority will be given to developments with units dedicated to serve households whose incomes are 30% (or less) of the area median income. Rents must be restricted accordingly. The number of units must be at least 5% of the total number of residential rental units in the development. If the applicant elects to serve very low-income households at 30% (or less) of the area median income, a signed statement, including the number of units to be set-aside for the very low-income tenants, shall be included in the application and must be reflected in the Development Income Section XVIII of the application. (MFHA, Tab #23(e)) | 3 |
Extends the duration of low-income use. Special priority will be given to developers who agree to maintain units for low-income occupancy for a period at least five years beyond the 30-year extended use period. If applicant agrees to extend the duration of low-income use, it must submit a signed statement which indicates the number of years, which must be a minimum of five (5), the affordability will be extended. (MFHA, Tab #23(f)) | 4 | |
Developments Located in Qualified Census Tracts and Rehabilitation of Existing Housing. Special priority will be given to any development that is located in a Qualified Census Tract or is for the rehabilitation of existing housing if it contributes to a concerted community revitalization plan. A copy of the Community Revitalization Plan which specifically addresses a need for affordable housing must be included with the Application in order to be considered for this scoring. (MFHA, Tab #24) | 3 |
Each application will be ranked according to the score awarded. In the event that some applicants score the same and are ranked the same, the Authority may use discretionary judgment in establishing a final award. The Authority reserves the right to disapprove or reduce the Housing Credits for an allocation during any stage, regardless of ranking under the priorities and point ranking outlined above. For any allocation not made in accordance with the established priorities and selection criteria of the Authority, a written explanation shall be made by the Authority to the general public.
ADFA reserves the right to disapprove any development for an allocation of Housing Credits, regardless of the ranking under the priorities and point ranking outlined above. ADFA reserves the right, in its sole and absolute discretion, to suspend or bar any applicant from the Housing Credit program, which ADFA determines has acted improperly, illegally or inappropriately in the applicant's dealings with the Authority or in any way relative to the Housing Credit Program.
Excluding contact permitted during the Response Period, it is the policy of ADFA to prohibit applicants from contacting ADFA staff in any manner regarding any application after the Application Deadline. Violations of this policy will be brought to the attention of the Board Housing Review Committee and could result in a downgrade to the final scoring or disqualification from the program. NO CONTACT WITH ADFA BOARD MEMBERS IS ALLOWED AND ANY SUCH CONTACT WILL BE GROUNDS FOR IMMEDIATE REJECTION OF AN APPLICATION.
Developments selected will be given preliminary approval for a reservation of Housing Credits. The required reservation fee of One Hundred and No/100 Dollars ($100.00) per low-income unit shall be submitted to ADFA within twenty-one (21) days of notification of reservation of Housing Credits. Developments that will not be placed in service in the tax year ADFA approves the Housing Credit reservation may be awarded a Carryover Allocation upon the satisfaction of requirements of IRC § 42 and the Authority. All developments with a valid reservation of Housing Credits will be required to obtain a Placed-in-Service Allocation or Carryover Allocation by December 7, 2009.
The Owner of the development identified in the application shall utilize the allocation of Housing Credits. The transfer of credits is prohibited.
Any change to the original application shall be submitted to ADFA in writing at least thirty (30) days prior to the desired effective date of the change. All changes shall be reviewed and approved by ADFA's Multi-Family Housing Staff or ADFA's Board of Directors. Any change to the original application made without approval from ADFA will be null and void.
A scattered site development is any low-income housing development whose buildings are at least 2000 feet away from each other. The development shall be so treated if all of the units in each building in the development are designated low-income housing units and all of the buildings in the development are located within one jurisdiction, i.e. city or county.
Assisted Living housing is a combination of housing, supportive services, personalized assistance and health care designed to respond to the individual needs of those who need help with activities of daily living, in a way that promotes maximum independence for each resident. Supportive services are available 24 hours per day to meet scheduled and unscheduled needs of each resident. An Assisted Living development applicant shall comply with all state and federal regulations for assisted living developments. Assisted Living development applicants will be required to submit an approved Certificate of Need or Permit of Approval from the State of Arkansas with their application. (MFHA, Tab #25)
Housing intended for the use of persons with a disability (as defined by HUD), which contains all the physical design, construction, and on-site service provision components adequate to meet the needs of the disabled population targeted. Any market study submitted in support of an application for housing intended for the use of person with disabilities shall address the housing needs of the targeted disabled population in the primary market area. The applicant shall also include a marketing plan designed to reach the targeted disabled population for which the proposed housing is to be developed. The applicant must submit its statement that the supportive services offered to the disabled population served will be optional as defined in 26 C.F.R § 1.42-11(b). (MFHA, Tab #22)
Applicants shall submit a final development cost certification supported by an audit report performed by a Certified Public Accountant prior to issuance of IRS Form 8609. See Section X of this QAP below for additional requirements.
Developments approved for Housing Credits shall comply with local and federal regulations pertaining to unit accessibility and construction standards to accommodate persons with physical disabilities. The applicant's architect must submit a statement that the development will comply with all federal and state accessibility laws. (MFHA, Tab #14.)
In a development with Housing Credits, the lead-based paint requirements apply to all units and common areas in the development.
The Authority requires that occupancy of all housing financed or otherwise assisted by ADFA be open to all persons regardless of race, color, religion, sex, handicap, familial status or national origin and contractors and subcontractors engaged in the construction or rehabilitation of such housing provide equal opportunity for employment without discrimination as to race, color, religion, sex, handicap, familial status or national origin.
Each applicant, consultant, development team member on the application, as well as any public official affiliated with a HOME program application, shall complete a Criminal Background and Disclosure Form - Housing, Attachment A to the Application. Failure to submit, or correctly complete the Criminal Background and Disclosure Form - Housing by each applicant, consultant, and development team member on the application or affiliated public official on a HOME program application, as required at Section VI.C.5 of this QAP, shall disqualify the Application for reservation of LIHTCs, Tax-Exempt Bonds subject to Private Activity Volume Cap ("Bonds") or HOME funds. (MFHA, Tab #12)
Each applicant or recipient of LIHTCs, Bonds, or HOME funds, and any principal of such applicant or recipient, is subject to ADFA's Criminal Background Check Policies and Procedures and their requirements. Each consultant, developer, or other development team member or any principal of such consultant, developer, or other development team, is subject to ADFA's Criminal Background Check Policies and Procedures and their requirements.
Applicants receiving reservations of federal low-income housing tax credits will be required to conduct a pre-construction conference with ADFA staff prior to construction. It will be the responsibility of the applicant to schedule the pre-construction conference.
Random inspections will be conducted on under construction and completed developments at ADFA's discretion to ensure compliance with ADFA requirements and representations made in the application. The inspection will be conducted by an ADFA selected inspector whose report will be submitted to ADFA. The developer/applicant will be responsible for the cost of the inspection which will be in accordance with ADFA's approved inspection fee schedule.
ADFA will follow the Code for Carryover Allocation requirements. ADFA will issue a Carryover Allocation following receipt of that carryover documentation required by ADFA from the development owner on December 7, 2009.
In order to continue to qualify for the Carryover Allocation, the owner's basis in the development as of the later of April 1, 2010 or November 1, 2010, as allowed by federal law, must exceed ten percent (10%) of the owner's reasonably expected basis in the development as of December 31, 2011 ("Carryover Allocation Basis"). The owner will be required to prove its Carryover Allocation Basis in the development on documentation required by ADFA. Failure to provide the required documentation proving the owner's Carryover Allocation Basis in the development by the later of April 1, 2010 or November 1, 2010, as allowed by law, will cause the Housing Credits to be returned.
The terms and conditions of the Multi-Family Housing Application will be incorporated into the Carryover Allocation documentation.
In order to receive IRS Forms 8609, the development owner will be required to submit the following items to ADFA staff for review:
In addition, staff will underwrite the Final Cost Certification to ensure continued compliance with all Threshold Requirements, Additional Requirements for a Complete Application, and Selection Criteria set forth in this QAP as reflected in the owner's Housing Application for Federal Low-Income Housing Tax Credits.
The owner of the development will be required to execute and record a Land Use Restriction Agreement ("LURA") that sets forth those covenants that will restrict the development property for a minimum of thirty (30) years ("the extended use period"). The owner is required to submit a "DRAFT" copy of the LURA for review and approval by ADFA prior to recording the LURA in accordance with Arkansas law. ADFA will not issue IRS Form 8609 until the LURA has been reviewed and approved by ADFA.
The LURA will state that the owner will comply with all applicable requirements under the Code, this Qualified Allocation Plan, other relevant statutes and regulations and all representations made in the Multi-Family Housing Application. Among other things, the LURA will:
Applicants shall comply with all applicable federal, state and local laws, including Section 42 of the Code. ADFA's Compliance Monitoring Policies and Procedures Manual for the Low-Income Housing Tax Credit Program may be obtained from ADFA's office, and may also be accessed at ADFA's website (www.arkansas.gov/adfa). Fair Housing manuals may be obtained from HUD's Little Rock office, and the Fair Housing Accessibility Guidelines may be accessed at HUD's website (www.hud.gov). Use the following link to the information needed:
Under the heading "Information For ... Other Partners"
Click on "Fair housing" Under the heading "General Info"
Click on "Fair housing accessibility guidelines"
The owner will be required to prepare and submit to the Authority, no later than February 1 of each year following the first taxable year of the owner's credit period, an Owner's Certificate of Continuing Program Compliance which, among other certifications, certifies that for the preceding 12-month period no tenants in low-income units were evicted or had their tenancies terminated other than for good cause and that no tenants has an increase in the gross rent with respect to a low-income unit other than as permitted under Section 42 of the Internal Revenue Code. The owner will also be required to prepare and submit to the Authority, no later than February 1 of each year following the first taxable year of the owner's credit period, the LIHTC Compliance Monitoring Status Report. Both the Certificate of Continuing Program Compliance and the LIHTC Status Report shall be submitted under penalty of perjury to the Authority in accordance with Internal Revenue Service procedures for monitoring compliance. The compliance monitoring procedures apply to all buildings placed in service in Arkansas that have received an allocation of Housing Credits as determined by Section 42 of the Code. Regular site inspections to monitor compliance with habitability standards, according to the Uniform Physical Conditions Standards established by the United States Department of Housing and Urban Development, and ADFA design standards will be carried out by the Authority at least once every three (3) years.
In the event the Authority becomes aware of non-compliance or upon the failure to submit a Certificate of Continuing Program Compliance, the Authority will notify the owner of the areas of non-compliance and the required timeframe to correct the deficiencies. There is a maximum of sixty (60) days to correct such non-compliance. Additionally, the Authority will notify the IRS, as required, of any non-compliance or failure to certify no later than forty-five (45) days after the end of the allowed time for correction.
The appropriate application fee (determined from the list below) shall be included with the application and be in the form of a check payable to the Arkansas Development Finance Authority. All fees are non-refundable.
Any development with four (4) or less units | $300.00 |
Non-Profit Owner (more than four (4) units) | $300.00 |
For Profit Owner (more than four (4) units) | $500.00 |
A non-refundable reservation fee of $100.00 per low-income unit will be required to secure the reservation of Housing Credits. Overpayments will not be refunded.
A fee equal to $100.00 per low-income unit will be required at the time the owner submits the final development cost certification requesting issuance of IRS Form 8609(s). Overpayments will not be refunded.
A monitoring fee equal to eight percent (8%) of the total annual Housing Credits allocation will be required at the time the owner submits the final development cost certification requesting issuance of IRS Form 8609(s). Overpayments will not be refunded.
Developments financed with tax-exempt bonds must apply to receive Housing Credits not allocated as part of the State's annual Housing Credit ceiling. Section 42(m)(1)(D) of the Code requires such developments to satisfy the "requirements for allocation of a housing credit dollar amount under the qualified allocation plan applicable to the area in which the project is located". Although these developments need not compete for an award through the competitive process, they will be evaluated for compliance with the Threshold Requirements set forth in Section VI.B. of this QAP above and the Additional Requirements for a Complete Application pursuant to Section VI.C. of this QAP above. In addition, each development financed with tax-exempt bonds shall be in compliance with the monitoring provisions of this QAP. Applicants shall comply with the 2009 Guidelines for Reserving Volume Cap for Tax-Exempt Private Activity Bonds for Residential Rental Housing and the Arkansas Development Finance Authority Rules and Regulations Implementing the Law on the Allocation of the State Volume Cap for Private Activity Bonds Pursuant to Act 1004 of 2001 in effect at the time of the filing of the application.
The Authority is charged with allocating no more Housing Credits to any given development than is required to make that development economically feasible. This decision shall be made solely at the discretion of the Authority, but in no way represents or warrants to any sponsor, investor, lender or any one else that the project is, in fact, feasible or viable.
ADFA's review of documents submitted in connection with the allocation is for its own purposes. ADFA makes no representations to the owner or anyone else as to compliance with the Code, Treasury regulations, or any other laws or regulations governing Housing Credits. The applicant and owner of the development are responsible for understanding and following all applicable tax law requirements for the development.
No director, officer, agent or employee of ADFA shall be personally liable concerning any matters arising out of, or in relation to, the allocation of Housing Credits.
Adopted by the Board of Directors of the Arkansas Development Finance Authority the 17th day of July 2008 and the 21st day of August 2008.
By:
Art Morris, Chair
ATTEST:
___________________________
Mac Dodson, President/Secretary
109.04.08 Ark. Code R. 002