More states are adding incentives to encourage the development of affordable housing targeted to veterans.

States in their low-income housing tax credit (LIHTC) programs are also adding incentives for the development of projects in “areas of opportunity,” reports the Corporation for Supportive Housing (CSH) in its new report, Housing Credit Policies in 2014 that Promote Supportive Housing.

The study looks at 2014 state qualified allocation plans (QAPs) to see what strategies are being deployed to encourage the development of supportive housing.

In analyzing QAP trends, CSH reports that six allocating agencies added incentives to target or create preference for veterans. This goes hand-in-hand with the availability of other resources for veterans, including the growth of the Department of Housing and Urban Development-Veterans Affairs Supportive Housing (HUD-VASH) program that combines rental assistance from HUD with supportive services from VA.

Illinois and Iowa carried forward scoring incentives for developments with project-based rental assistance, including project-based VASH. Other states, including Alaska, Nevada, and New Mexico encouraged projects that target veterans or create tenant selection preference for veterans, says CSH.

For the first time, the organization also analyzed “areas of opportunity” policies. In general, these are areas with low poverty rates, good employment opportunities, or high-performing schools. Projects in these neighborhoods may provide residents with greater opportunities, but they often come with higher development costs. CSH reports that 22 agencies provide incentives to develop projects in these neighborhoods.

More QAPs are also encouraging the integration of supportive housing units in other affordable housing developments.

Overall, 53 out of 56 housing credit agencies provide potential scoring advantages for supportive housing.

Fifteen agencies promote supportive housing with set-asides of credit authority, a decrease from 16 in 2013.

And, six LIHTC agencies (Alaska, Delaware, District of Columbia, Indiana, Iowa, and North Carolina) have a threshold requirement of dedicating 5 percent to 10 percent of units for persons with special needs or persons with disabilities, which supports permanent supportive housing. This is an increase from three states in 2013, reports CSH. Another seven agencies have more general threshold requirements that promote permanent supportive housing.