TAX CREDITS & TAX-EXEMPT BONDS: STATE-BY-STATE PREVIEW

INDIANA

BY JERRY ASCIERTO

AFFORDABLE HOUSING FINANCE • DECEMBER 2007

INDIANAPOLIS—The Indiana Housing and Community Development Authority (IHCDA) expects its low-income housing tax credit (LIHTC) authority to be roughly $12.3 million in 2008, the same as 2007. The exact amount hadn’t been determined by late October.

Applications are due by March 7, 2008, with reservations set for June 19, 2008. The maximum LIHTC award in 2008 will be $800,000. No major changes have been made from the 2007 qualified allocation plan.

In 2007, more than $12.3 million in 9 percent LIHTCs was reserved, compared to $25.8 million requested. Twenty-seven projects received 2007 reservations for 9 percent LIHTCs, representing 1,401 tax credit units out of 1,503 total units. The most oversubscribed set-aside categories included not-for-profits and rural housing.

The median tax credit award was $410,165, and the median project size was 35 units.

New construction received the bulk of financing, about $8.9 million. Approximately 20 percent of the IHCDA’s annual tax credit authority goes toward the preservation of older projects. Acquisition-rehabilitation deals—a category which includes preservation— scored more than $3 million in 2007, about 25 percent of the overall authority.

More than $10.8 million of the state’s $12.3 million went for units targeting those with physical or mental disabilities, though the state includes units built for the homeless in that category. More than a third of total tax credit authority, about $4.5 million, went to rural areas.

Half of all tax credit units targeted those earning up to 50 percent of the area median income (AMI); 20 percent went to those earning up to 40 percent of the AMI; and 12 percent went to those earning up to 30 percent AMI. The rest were targeted at those earning up to 60 percent of the AMI.

As of late October, IHCDA was unsure how much statewide tax-exempt bond volume cap would be available for 2008. The deadline for developers to turn in their multifamily bond applications is Jan. 8, 2008.

In 2007, the state had a total volume cap of more than $536 million, and about $30 million was set aside for requests for multifamily developments. Two projects representing 400 units received bond allocations in 2007 totaling $21.9 million.

Slightly more than $1.1 million in 4 percent tax credits was reserved in 2007 for those two projects.

2008 LIHTC PROGRAM: