HUD issues 202/811 mixed-finance rule

HUD's final rule is out today on mixed-finance development for seniors' and disability housing under Secs. 202 and 811. Changes from the Dec. 1, 2003 interim rule include a "less specific, more flexible approach" to Secs. 891.805, 891.808 and 891.828 in response to comments, which had included complaints that the interim version of Sec. 891.808, on the loan of a capital advance from a nonprofit to a mixed-finance partnership, "could interfere with the ability of mixed-finance developments to qualify for favorable treatment for Low Income Housing Tax Credit (LIHTC) purposes."

Additionally, Sec. 891.815 is revised to allow higher developer fee caps and "detailed firm commitment application, mixed-finance proposal, and evidentiary material submission requirements are being removed from the rule in response to comments that these sections were overly detailed and restrictive." There are also changes to rules on conflict and identity of interest and on operating reserves.