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Low-Income Housing Tax Credit Rates for July


The Internal Revenue Service (IRS) issued Revenue Ruling 2021-12, which provides various prescribed rates for federal income tax purposes, including applicable federal interest rates, adjusted applicable federal interest rates, and adjusted long-term and tax-exempt rates for July 2021.
As provided in the ruling, Table 4 contains LIHTC Appropriate Percentages Under Section 42(b)(1) for July 2021:
  • Appropriate percentage for the 70% present value low-income housing credit: 7.35%
  • Appropriate percentage for the 30% present value low-income housing credit: 3.15%
Note: Under section 42(b)(2), the applicable percentage for non-federally subsidized new buildings placed in service after July 30, 2008, shall not be less than 9%.
To view the revenue ruling from the IRS, click the Web Link provided.
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Congress


"Lawmakers Eye Tax Credit in Bipartisan Affordable Housing Bill"

Industry Trends


"The Biden Administration’s Housing Plans Can Address the Housing Issues Highlighted in Harvard JCHS Report"
"Affordable Housing Developers Talk Tax Credits, Challenges"

State and Local Activities


"Missouri Treasurer Fitzpatrick Calls for Expanding Program That Boosts Low-Income Housing Tax Credit Pricing"
"Corman: State Budget Addresses Local Need for Affordable Housing"

Management and Compliance


"What You Should Know About BREEAM Certification"

Green Building


"Habitat for Humanity Kicks Off Work on Its First 3D-Printed U.S. Home in Tempe, Arizona"

Association News


NAAEI Offers Tax Credit Property Management Online Training
NAAEI Encourages Your Support for Key Housing Affordability Legislation
Q1 2021 Apartment Jobs Snapshot
Time to Start Your COQ Award Application
NAHMA Releases 2021 Affordable 100 List
Become a Specialist in Housing Credit Management® (SHCM®) Company!
Upcoming Events


Congress


Lawmakers Eye Tax Credit in Bipartisan Affordable Housing Bill
Bloomberg (06/26/21) Hawkins, Mackenzie

The Affordable Housing Improvement Act of 2021, spearheaded by Representatives Suzan DelBene (D-Wash.) and Jackie Walorski (R-Ind.), would permanently increase tax-credit allocations to states, allow states to fund more projects by easing bond-funding requirements and expand subsidies for underserved communities. Supporters say the measures could significantly reduce a U.S. housing deficit that has grown to nearly 4 million units. While the plan shares many of the goals of President Biden’s infrastructure proposal, which seeks 2 million new housing units over the next eight years, it uses different tactics. DelBene and Walorski want to make their bill the leading proposal as Congress weighs housing legislation beyond the confines of the infrastructure deal struck between Biden and a bipartisan group of senators in June. In contrast to the administration’s broad approach, the lawmakers’ proposal focuses on the Low-Income Housing Tax Credit. The tax credit's track record as a public-private partnership, a congressional aide said, makes the tax incentive the best available vehicle to rapidly expand affordable housing. A previous version of the bill drew broad bipartisan support in the last Congress. The biggest hoped-for boost would allow states to ramp up development by halving the share of costs that must be financed by private-activity bonds. The bill would also expand the pool of money available for financing affordable housing by making permanent a 12.5 percent increase in tax-credit allocations to states approved in 2018, with a 50 percent increase on that number phased in over the next two years.
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Industry Trends


The Biden Administration’s Housing Plans Can Address the Housing Issues Highlighted in Harvard JCHS Report
Novogradac (06/21/2021) Lawrence, Peter

The latest annual report from the Harvard Joint Center for Housing Studies (JCHS) details the data showing that minority households and those with low-incomes, especially renters, continue to be disproportionately negatively impacted by the pandemic. At the same time, those households not negatively impacted by the pandemic have helped to spur a homeownership boom, leading to a tightening of the market and making it even more difficult for potential first-time homebuyers to enter the market. The JCHS report shines a spotlight on the widening gap between vulnerable households who have not been able to fully benefit from the uneven economic recovery, thus emphasizing the need to strengthen and expand the Low-Income Housing Tax Credit (LIHTC) and other housing proposals aimed at addressing the nation’s affordable housing crisis. JCHS reports that in 2019, approximately 46 percent of renters were cost burdened, paying more than 30 percent of their incomes for housing that year. The percentages of low-income renters and homeowners—those earning less than $25,000—that were cost burdened is even higher; 82 percent of renters and 69 percent of homeowners in this income cohort are cost burdened. Citing the U.S. Census Bureau’s Household Pulse Surveys, the JCHS report details how low-income households have been affected by the pandemic and continue to struggle. JCHS says more than half of low-income renters and 46 percent of homeowners reported having lost income since the start of the pandemic. Details to expand the LIHTC were detailed in the Biden administration’s fiscal year 2022 revenue proposals. These proposals build upon repeated calls to expand the LIHTC; the Affordable Housing Credit Improvement Act (AHCIA) of 2021, and the Moving Forward Act represent the plans for enhancing the LIHTC most likely to be considered by Congress.
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Affordable Housing Developers Talk Tax Credits, Challenges
GSA Business Report (07/08/21) Hulsey, Molly

NHE Inc. is a Greenville, South Carolina-based company that manages more than 90 affordable housing communities across the state. The company's CEO, Taylor Davis, notes affordable housing projects face various financial hurdles. NHE's development director, Robinson Villa, points out that projects that rely on federal funding sources such as the Low-Income Housing Tax Credit (LIHTC) and must use energy efficient materials that meet the federal standard and are durable enough to last several decades without much wear or tear. Davis adds that in the Greenville area, another key challenge is finding affordable land that is also within an "area of opportunity," a property designated by the state for robust growth by any type of developer. Villa recalls that NHE encountered opposition to its Renaissance Place project, a fixed-income senior living community, but its rezoning process was more pleasant. The project is set to be completed in July. Meanwhile, the Trump administration's December COVID-19 relief bill fixed the LIHTC at 4 percent. Davis says, “So, to have that fixed at 4 percent, it just delivers, I would say, 10 percent to 15 percent more equity to the capital stack." South Carolina also recently passed the Workforce and Senior Affordable Housing Act that works alongside the federal LIHTC to deliver more equity to a transaction to make it more financially feasible. A strategic plan led by the Greenville Housing Fund and Greenville County Redevelopment Authority calls for constructing 10,000 rent or income-restricted units and preserving 3,000 units of existing affordable housing over 10 years, according to an October announcement.
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State and Local Activities


Missouri Treasurer Fitzpatrick Calls for Expanding Program That Boosts Low-Income Housing Tax Credit Pricing
St. Louis Post-Dispatch (06/22/21) Barker, Jacob

A committee within Missouri’s housing commission wants the state to expand a pilot program to streamline the disbursement of Low-Income Housing Tax Credits (LIHTCs). The goal of the pilot is to boost prices for the credits. Missouri Treasurer Scott Fitzpatrick, who sits on the Missouri Housing Development Commission board, says a committee he chairs will push for half of the state’s low-income tax credits to be included in the accelerated redemption program. The committee’s report found that frontloading the tax credits during the 10-year payout period for low-income housing projects increased the credit price to 67.5 cents on the dollar, up 9 cents from regular credit prices last year and up 10 cents from 2017 prices. Fitzpatrick, who chaired the study committee, says, "The accelerated redemption pilot program led to a significant increase in pricing for LIHTCs meaning your tax dollars are being spent more efficiently and more low-income housing can be built as a result." When Missouri reintroduced its state LIHTC program last year, it included 20 percent of the projects selected for state credits in the accelerated redemption program. Missouri’s program pays out about 70 percent of the credits in the first five years. The committee’s report said the higher prices that would generate equates to 63 more housing units a year, based on last year’s average price-per unit of $181,867.
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Corman: State Budget Addresses Local Need for Affordable Housing
Centre Daily Times (07/12/21) Corman, Jake

In this commentary, Pennsylvania state Sen. Jake Corman (R-Bellefonte) writes that rising building costs, supply disruptions, and eviction moratoriums are adversely affecting low-income families searching for new homes. Pennsylvania's budget directly addresses these obstacles by allocating $10 million to the state's Low-Income Housing Tax Credit program, which was created by lawmakers last year to encourage investment in affordable housing. A number of local projects have already received funding through this program, such as Cherry Lane Apartments and Stonebridge in State College and Westminster Place at Huntingdon. These three projects alone added more than 110 units of affordable housing. Going forward, the funding will support such projects as Evergreen Heights in State College, which is geared toward senior housing and is situated close to public transportation and medical care. The state budget also provides $50 million in federal stimulus dollars to low-income housing developers to offset the increase in construction costs, enabling these critical projects to continue advancing. The additional funding to support new housing options for community residents is likely to have a significant impact for years to come.
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Management and Compliance


What You Should Know About BREEAM Certification
Multi-Housing News (06/18/21) Gagiuc, Anca

An increasing number of properties in the United States are being built to standards set by the Building Research Establishment’s Environmental Assessment Methodology (BREEAM), a sustainability assessment method for buildings. Breana Wheeler, U.S.-based operations director at Building Research Establishment (BRE), says a total of 47 assets have been certified nationwide, a figure expected to double by the end of this year. Certifications have been awarded in 15 states, with California leading the way with 14, followed by Illinois' seven and New Jersey's five. Wheeler says BREEAM is intended to encourage a holistic approach by focusing on a wide range of human health and well-being aspects, in addition to long-term resilience and management practices. The BREEAM USA In-Use Version 6 is a locally adapted version of the international program and the first update since BREEAM’s entry in the United States in 2016. Wheeler says Version 6 introduced an enhanced Resilience category that provides exemplary credits for using climate change scenarios in the evaluation and connecting the emergency planning for these events to community resilience. Wheeler notes, "We then added encouragement to evaluate transitional risk and opportunities, as well as social risks, which aligned the asset with the Task Force on Climate-Related Financial Disclosures reporting requirements. BREEAM has always set net-zero carbon performance as the ultimate outcome in our program." She also notes that BREEAM's residential program can accommodate structures ranging from multifamily to single-family rentals and aligns with the commercial program.
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Green Building


Habitat for Humanity Kicks Off Work on Its First 3D-Printed U.S. Home in Tempe, Arizona
The Architect's Newspaper (06/16/21) Hickman, Matt

Arizona's affordable housing shortage is the fourth worst in the nation, according to a report by the National Low Income Housing Coalition. To encourage new modes of sustainable, scalable low-cost housing in the state, the Central Arizona chapter of global nonprofit Habitat for Humanity is turning to 3D printing. The nonprofit's latest undertaking is a solar-ready single-family residence in Tempe, marking the first 3D-printed home building project for Habitat in the United States. Construction on the three-bedroom, two-bathroom single-story dwelling began in April and is expected to be completed in the early fall. Once an eligible homeowner is selected via Habitat’s standard application process, a family could potentially move into the 3D-printed home as early as this October. For the Tempe project, the Habitat Central Arizona team used a gantry-style Build on Demand Printer shipped in March from Germany-based PERI Group. The home is a hybrid build that combines 3D printing technology with conventional construction methods. In this particular instance, 70 percent to 80 percent of the Tempe home, including its interior and exterior walls, will be 3D-printed with a special concrete blend. Habitat Central Arizona is also pursuing LEED Platinum certification along with an IBHS FORTIFIED Home designation. Jason Barlow, president and CEO of Habitat Central Arizona, says, "If we can deliver decent, affordable, more energy-efficient homes at less cost, in less time and with less waste, we think that could be a real game-changer. Just think of the implications."
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Association News


NAAEI Offers Tax Credit Property Management Online Training

The National Apartment Association (NAA) Education Institute offers a 12-hour online course to prepare students for the SHCM certification exam. The training topics include program regulations, unit eligibility, applicant eligibility and certification, documentation, recordkeeping, compliance reporting and monitoring. This course satisfies the education requirements to apply for the SHCM credential and includes the exam study guide. To register for the course, click the Web Link below.
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NAAEI Encourages Your Support for Key Housing Affordability Legislation

Several key pieces of legislation that advance NAA’s Housing Affordability Agenda are being introduced on Capitol Hill, and NAA needs your help in getting Congress to adopt them. Follow the links below to voice your support for these important issues.
  • Support increased funding and improvements to the Section 8 Housing Choice Voucher (HCV) Program: https://p2a.co/w4QpJcp
  • Support the Yes In My Backyard (YIMBY) Act, which encourages government entities to eliminate barriers to housing development: https://p2a.co/ebfeont
  • Support the Housing Supply and Affordability Act, which will authorize a grant program for the development and implementation of housing supply and affordability plans: https://p2a.co/ebfeont
  • Support the Build More Housing Near Transit Act, which will address the undersupply of housing near walkable, transit-served locations: https://p2a.co/ocbj6pj
To learn more about NAA’s Advocacy, click the Web Link provided.
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Q1 2021 Apartment Jobs Snapshot

NAAEI brings you its workforce update: The Apartment Jobs Snapshot highlights labor force trends in the rental housing industry. The profile examines total job posting trends by position and geography as well as average salaries, time required to fill a position and the top skills found in job postings. Use the Web Link provided to review the key figures.
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Time to Start Your COQ Award Application

The submission deadline for entries to NAHMA’s 2021 Communities of Quality Awards program is Nov. 4, 2021. The Communities of Quality (COQ) Awards recognize outstanding property management companies providing the highest quality of safe, affordable multifamily rental housing in communities across the country.
To enter the 2021 COQ Awards competition, a property must first apply for and achieve National Recognition as a NAHMA Community of Quality with a minimum score of 325 points on its National Recognition Application. The deadline for submitting a National COQ Recognition Program application to a local AHMA for consideration in this year’s COQ Awards cycle is Sept. 2, 2021.
The AHMAs will be honoring their local NAHMA Communities of Quality program participants. Please check with your local AHMA for its program details. A directory of the AHMAs is available at http://www.nahma.org/membership/ahma-directory.
For more details about the COQ Awards, click on the Web Link provided.
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NAHMA Releases 2021 Affordable 100 List

The National Affordable Housing Management Association (NAHMA) announces its 2021 Affordable 100—a list of the 100 largest affordable multifamily property management companies ranked by affordable unit counts—is available on its website, click Web Link below, as well as in the June issue of NAHMA News. The NAHMA website version expands the list to the top 120 largest multifamily property management companies. In addition, the online version presents two specialty lists: the 25 largest housing credit (LIHTC) property management companies and the 25 largest Rural Development program property management companies.
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Become a Specialist in Housing Credit Management® (SHCM®) Company!

The two 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) and the National Apartment Association Education Institute (NAAEI).
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.
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Upcoming Events

NAAEI Affiliate Education Conference
August 2-4, 2021
More

AEX Live
August 4-6, 2021
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Apartmentalize
August 31-September 2, 2021
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NAA Digital Studio
September 14, 2021
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NAHMA Biannual Top Issues in Affordable Housing Virtual Fall Conference
October 20-22, 2021
More

NAA Assembly of Delegates
November 2-4, 2021
More

NAA Digital
December 7-9, 2021
More
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July 2021