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HUD Publishes Section 202 Capital Advance Notice of Funding Availability
The Department of Housing and Urban Development (HUD) is providing up to $50 million in capital advance funding for the development and operation of supportive rental housing for very-low income persons aged 62 years or older and project rental subsidies in the form of a Project Rental Assistance Contract to maintain ongoing affordability. This funding, leveraged with other financing sources, will expand affordable housing opportunities and include supportive services such as transportation, continuing education and/or health that will allow seniors to live independently and to age in place. HUD will hold a single, national webinar on Thursday, April 25, from 2-3 p.m. Eastern, to provide an overview of the Notice of Funding Availability. Register here for the webinar. To learn more, click on the Web Link below.
Industry Trends
"Inspections Show Deterioration of U.S.-Funded Housing for Poor"
Tax Issues and Tax Reform
"Kamala Harris Revives Tax Credit Push to Help People Pay for Housing Costs"
IRS-Related Activities
"IRS Says Bond Financing Can Be Used for Housing for Vets, Others"
HUD-Related Activity
"HUD Announces Rollout of Sections 221(d)4, 220 LIHTC Pilot Program"
State and Local Activities
"Wake County Backs $12.6 Million for Affordable Housing in Raleigh, Wake Forest, Garner, and Apex"
Management and Compliance
"Four Tips for Pest Control on Green Roofs"
Green Building
"Sustainable: Green Zones Offer Energy-Efficiency Incentives"
Association News
Help NAHMA Promote Adult Literacy
Register for Emerging Trends in Tax Credit Webinar
NAHMA Educational Foundation Scholarship Application Due in May
Get Started on Your Vanguard Application
Become a Specialist in Housing Credit Management® (SHCM®) Company!
Upcoming Events
Industry Trends
Inspections Show Deterioration of U.S.-Funded Housing for Poor
Associated Press (04/09/19) Donn, Jeff; Mohr, Holbrook
An Associated Press (AP) analysis of federal housing data found that health and safety inspection scores at taxpayer-funded apartments for low-income tenants have been declining for years. Most failing sites receive what amounts to a warning and several chances to correct violations. Nearly 160,000 units at private properties with federal subsidy contracts have failed at least one inspection since 1999. Federal data shows that the vast majority of failing inspections in private units involved urgent safety or health violations, such as nonworking heaters and emergency exits that do not open. The U.S. Department of Housing and Urban Development subsidizes rents for 2.1 million low-income households assigned both to public housing and privately owned apartments. Federally subsidized private apartments fare worst in Louisiana, where 12 percent of inspections gave failing grades, AP's analysis shows. Mississippi was second at 10 percent. Meanwhile. Maryland had the country's highest inspection failure rate for public housing since 2013 at 32 percent, largely due to blighted complexes in Baltimore. The District of Columbia comes second at 29 percent. Some housing advocates say more subsidy vouchers should be distributed for a separate federal program that allows tenants to select a unit on the private market. Others suggest more tax credits for building and repairing low-income housing, more federal staff, and more tenant participation in site improvements.
Tax Issues and Tax Reform
Kamala Harris Revives Tax Credit Push to Help People Pay for Housing Costs
Roll Call (04/09/19) Lesniewski, Niels
U.S. Sen. Kamala D. Harris (D.-Calif.), a Democratic presidential hopeful, is reintroducing the proposed Rent Relief Act, which seeks to provide new tax credits to help families with high housing costs. The legislation would create refundable tax credits in cases where rent and utilities exceed 30 percent of a household's income. In addition, it would provide a mechanism for the Treasury Department to pay out the tax credit on a monthly basis to eligible households. The tax credit's availability gradually decreases as household gross income increases, and it is dependent on the rent paid being in line with the average cost of housing in a given neighborhood. Refundable tax credits are paid out by the government even in instances where there is no income tax liability, making them a frequent target for criticism by conservatives. Speaking recently at a California Labor Federation and State Building and Construction Trades Council dinner in Sacramento, Harris said, "In America today, 99 percent of the counties in our country, if you are a minimum wage worker working full-time, you cannot afford market rate for a one-bedroom apartment." Earlier this year, Harris reintroduced a bill to provide up to $6,000 a year in credits to families making less than $100,000 annually, seeking to provide assistance to offset the increased cost of living.
IRS-Related Activities
IRS Says Bond Financing Can Be Used for Housing for Vets, Others
Housing Finance (04/08/19) Kimura, Donna
Guidance from the Internal Revenue Service (IRS) has clarified that tax-exempt private-activity bonds can be used to finance affordable housing developments for veterans, farmworkers, and other populations. Tim Anderson, a partner at RubinBrown, points out that Sec. 42 of the Internal Revenue Code allows housing credit properties to have preferences for veterans and other special groups. However, the tax-exempt bond rules under Sec. 142 did not contain the same provisions. "Now this guidance marries those together and says yes you can build homes for veterans and qualify for the credit and still take advantage of tax-exempt bond financing that's available," Anderson explains. The guidance became necessary after IRS officials indicated last year that such housing was potentially a violation of the general public-use requirements in bond regulations. Multifamily housing bonds and the 4 percent Low-Income Housing Tax Credit (LIHTC) have been widely used together to develop housing for people with special needs. "It was concerning because people want to do affordable housing for veterans and for specific groups, and a lot of these projects are done with LIHTCs and bonds," observes Vicky Tsilas, a partner at Ballard Spahr. The recent reinterpretation of the bond rules was preventing shovel-ready housing developments for veterans from moving ahead, according to U.S. Rep. Mike Thompson (D-Calif.), who chairs the House Ways and Means Select Revenue Measures Subcommittee. He and other members of Congress as well as affordable housing industry groups urged the IRS to resolve the issue.
HUD-Related Activity
HUD Announces Rollout of Sections 221(d)4, 220 LIHTC Pilot Program
Novogradac (04/04/2019) Vol. 10, No. 4 Landry, Ray
Department of Housing and Urban Development (HUD) Secretary Ben Carson recently announced the expansion of the Low-Income Housing Tax Credit (LIHTC) pilot program to include new construction and substantial rehabilitation projects under the Section 221(d)4 and Section 220 loan programs. The pilot program promises a 30-day processing time for loans processed under the expedited approval process and 60 days under the standard approval process. The maximum loan amount for pilot transactions is $25 million, and at least 25 percent, but not more than 75 percent, of the developer fee must be deferred. The pilot program also supports development in opportunity zones (OZs), which are generally census tracts in low-income communities that meet the new markets tax credit (NMTC) definition of "low-income community." However, not all LIHTC transactions will be eligible for the pilot program. These ineligible properties will be processed under current LIHTC underwriting guidelines, and include 4 percent LIHTC new construction transactions, Rental Assistance Demonstration properties, HTC and NMTC transactions, adaptive reuse of nonresidential structures, developments involving significant demolition or gut rehabilitation, and those involving inexperienced development team members, including property managers. Last year, about 34 percent of HUD's 912 loans insured comprised LIHTC transactions, and of the 148,726 apartment units insured last year, 31 percent were LIHTC units.
State and Local Activities
Wake County Backs $12.6 Million for Affordable Housing in Raleigh, Wake Forest, Garner, and Apex
Raleigh News & Observer (NC) (04/16/19) Johnson, Anna
Wake County (North Carolina) leaders on April 15 backed nine affordable-housing developments — the county's largest financial commitment to its affordable-housing efforts. The unanimous vote means $12.6 million will be loaned to developers to add 920 affordable rental units to the market, if those projects can get tax credits from the N.C. Housing Finance Agency this fall. "Wake County does have a significant challenge ahead of us, but we are prepared," said Lorena McDowell, the county's first housing director. "We are growing, and our efforts will grow along with us." The county funded 440 units last year, but only 190 of those rooms received tax credits. County leaders hope more than half will be approved this year. The North Carolina Housing Coalition considers households cost-burdened when they spend more than 30 percent of their income on housing. There are nearly 100,000 cost-burdened homes in Wake County, and 41 percent of renters have a hard time covering their rent. Wake County’s area median income (AMI) is $59,100 for an individual or $84,300 for a family of four. More than 80 percent of the rooms in the nine developments will be available for people who make less than 60 percent of Wake County’s AMI, with 15 percent made available for those who make less than 30 percent.
Management and Compliance
Four Tips for Pest Control on Green Roofs
Buildings (03/14/19) Morton, Jennie
Green roofs provide buildings with insulation and stormwater management. However, they could also be putting tenants at risk of pests that are attracted to the foliage. The author details four tips to ensure your roof will thrive without becoming overrun with wildlife. One is to "understand which pests frequent vegetated roofs." Because a green roof is designed to be a habitat, one pest problem often encourages another. For instance, birds may become more attracted to the area because there are better nesting opportunities and a greater amount of insects to eat. However, they may be carrying mites that will then establish a population on the roof. Tip two, recognize the risks to your building and occupants. Mice and rats not only leave behind contaminated droppings, they can also chew and burrow straight into a building as they create nests. Meanwhile, spider webs and bird droppings can decrease the aesthetics of a rooftop space. Three, look for signs of activity. Because some green roofs are intended to be self-sustaining once established, they often have a minimal maintenance schedule. To avoid missing signs of pest activity, property management must make it a habit to visit the roof more regularly than what is required to keep the vegetation in good health. Finally, use integrated pest management, which prioritizes prevention strategies over reactive ones and favors low-impact methods to address pests. This includes no-kill traps, anti-roosting devices, and sealing cracks in the envelope.
Green Building
Sustainable: Green Zones Offer Energy-Efficiency Incentives
Finance & Commerce (04/02/19) Jossi, Frank
Under Minneapolis' Green Zones program, businesses have access to extra subsidies for such things as solar installations and energy-efficiency improvements to commercial and residential buildings. Solar installations on 30 public and privately owned sites added 6.2 megawatts of clean power in 2018. The city's two green zones represent just 14 percent of Minneapolis' businesses, but comprised 43 percent of the solar installations, notes Patrick Hanlon, director of environmental programs in the Minneapolis Health Department. This year, the city allowed solar developers to submit one proposal for multiple installations on residences and businesses, leading to an increase in submissions. Of the 65 solar projects the city approved for a subsidy, at least 25 were in the green zones, Hanlon points out. A 40-kilowatt system producing 50,000 hours would receive $17,500 in a green zone versus $12,500 somewhere else in the city.
Association News
Help NAHMA Promote Adult Literacy
Help NAHMA promote adult literacy by connecting affordable housing residents to a free app for improving reading and English skills. The app is available for download until Aug. 31.
NAHMA members are uniquely situated to reach residents of affordable housing who are working hard to improve the financial and educational status of their families. Some of these residents may be interested in taking advantage of a free literacy app to improve reading and English skills.
To help NAHMA succeed in promoting adult literacy and demonstrating that housing is a platform for success, downloadable promotional flyers—available in English and Spanish—are available to share with residents.
The literacy app is free, self-supported, self-paced, and is intended for all ages. The app can be downloaded at https://abc.xprize.org/ac5588 using Community Referral Code 5588 until Aug. 31.
For more information, click on the Web Link below.
Register for Emerging Trends in Tax Credit Webinar
Join the experts on May 23 beginning at 2 p.m. Eastern to learn about the emerging trends in tax credits.
The webinar will provide 1.5 hours of instruction, followed by a 30-minute question-and-answer session. It is presented by Dodi Gershen, NAHP-e, FHC, SHCM, vice president and director of management, The Gershen Group, and Gwen Volk, SHCM, NAHP-e, CPO, FHC, president of Gwen Volk Infocus Inc.
It is free to current SHCM certified professionals and $149 for non-SHCM professionals. Be sure that you renewed your SHCM credential in 2018 in order to participate in this webinar free of charge.
For questions about your renewal, contact Natasha Patterson, ACA, from NAHMA, at npatterson@nahma.org or 703-683-8630, ext. 117. For registration issues, contact Amy Allen, from NAA, at AAllen@naahq.org or by phone 703-797-0608.
To register for this course, click the Web Link below.
NAHMA Educational Foundation Scholarship Application Due in May
Now is the time to let your residents know about the NAHMA Educational Foundation scholarship program, if you have not done so already. To access the application, visit https://nahma.communityforce.com. It can also be found on the NAHMA website at www.nahma.org by clicking on the Educational Foundation link under the About Us tab. The deadline for completed applications is 10 p.m. Eastern on Wednesday, May 15. This year will be the 13th consecutive year that the foundation has made scholarships available.
Eligibility for the program requires that an applicant be a resident in good standing at an AHMA-affiliated multifamily community and be either a high school senior with a minimum grade point average of 2.5, a general equivalency diploma holder or a matriculated student with a minimum grade point average of 2.3 at an accredited college or trade/technical school.
For more information, including a downloadable flyer, click on the Web Link provided below.
Get Started on Your Vanguard Application
Avoid any last-minute surprises when filling out the NAHMA 2019 Affordable Housing Vanguard Award application by starting it now. The completed submissions are due June 7, so review the application requirements today to ensure you’ll have everything you need to meet the deadline. The application can be downloaded from the Vanguard Award webpage, https://www.nahma.org/awards-contests/vanguard-award-2/.
Affordable multifamily housing communities that are less than 3 years old―as of June 7, 2019―may apply, based on date of completion of new construction or completion of major rehab.
Categories include:
- New Construction, two subcategories: more than 100 units and under 100 units
- Major Rehabilitation of an Existing Rental Housing Community
- Major Rehabilitation of a Nonhousing Structure into Affordable Rental Housing
- Major Rehabilitation of a Historic Structure into Affordable Rental Housing
For more information about the award or to download an application, click on the Web Link below.
Become a Specialist in Housing Credit Management® (SHCM®) Company!
The three national associations sponsoring the Specialist in Housing Credit Management® (SHCM®) certification program invite your company to become a Specialist in Housing Credit Management® Company, a corporate designation created specifically to honor management companies that successfully maintain a significant portion of their properties and staff to the high standards of the SHCM certification program.
The SHCM program, developed especially for management companies involved with properties developed and operated under the Low-Income Tax Credit (LIHTC) program, is sponsored by the National Affordable Housing Management Association (NAHMA), the National Apartment Association Education Institute (NAAEI), and LeadingAge.
Earning the SHCM Company designation publicly demonstrates that a company is among the finest managers of LIHTC housing in the industry.
For more details on how to become a SHCM Company, click on the Web Link below.
Upcoming Events
NAA Apartmentalize
June 26-28, 2019
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NAAEI Affiliate Education Conference
August 19-21, 2019
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NAA Maximize
September 23-25, 2019
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NAHMA Biannual Top Issues in Affordable Housing Fall Conference
October 27-29, 2019
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LeadingAge Annual Meeting + Expo
October 27-30, 2019
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News summaries © copyright 2019 SmithBucklin
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