Developers are studying the proposed qualified allocation plan (QAP) for Virginia’s competition for federal low-income housing tax credits (LIHTCs).
The Virginia Housing Development Authority (VHDA) released its proposed 2014 QAP this month and will hold a focus group-style meeting on the plan Sept. 4. By Oct. 2, the plan should be approved. Applications for Virginia’s $18.4 million in LIHTCs will be due by March 14, 2014, and the rankings announced June 4, 2014.
The proposed QAP sets cost limits for LIHTC projects that range from more than $300,000 per unit in areas of Northern Virginia to less than $200,000 per unit in less developed parts of the state. So what happens when a developer promises to stay within the cost limits, but spends over the limit anyway? These developers will be punished by losing up to 50 points in the state's point-scored competition for subsidy in the “developer experience” category of future LIHTC applications for the next three years.
Experienced housing experts who start new development companies can also earn 50 points for their applications by showing past experience as individuals. It the past, officials only considered the experience of the group applying for LIHTCs.
The proposed QAP also makes it easier for developers who are fighting local opponents to affordable housing to win reservations. Applications may still lose up to 25 points if local officials write to oppose the project, but opposition letters must be accompanied by letters from lawyers who certify the opposition does not have a discriminatory intent or effect under Fair Housing Law.
The proposed QAP also revises the point categories for applications that would house people who earn lower incomes and tweaks the points available for sustainable design features.
Applications can hypothetically score up to 900 points in VHDA’s competition for LIHTCs, though most applications score in the 500- to 650-point range, says Jim Chandler, director of VHDA's LIHTC program. Demand is high: Developers applied for twice the $18.4 million in LIHTC officials had to reserve in 2013.