Current through Register Vol. 46, No. 39, September 25, 2024
(a) Under New York State's overall tax credit
allocation process as it pertains to the HFA, the Agency typically allows
Private Activity Bond Credits to qualified residential rental projects located
in New York State financed by obligations subject to the Private Activity Bond
Cap, the interest on which is exempt from federal income tax as provided in
Section 42(h)(4) of the Code. Applications for Private Activity Bond Credits
for projects financed by the Agency are therefore only made as part of the
Agency's overall financing application process as described in (c) through (g)
below. Applications for the allowance of As of Right Credits to projects
financed by tax exempt bonds from an issuer other than the Agency are governed
by the provisions of (h) of this section.
(b) Applications for HFA financing and/or 4%
LIHTC through the Agency will be accepted and processed as they are received
throughout the year. There is no separate LIHTC application fee for applicants
who are also applying for HFA financing.
(c) Preliminary underwriting information must
be submitted in the form required by the Agency.
(d) The preliminary underwriting information,
additional material required by the Agency as part of the HFA financing
application and the appropriate Due Diligence reports to be obtained by the
Agency, will serve as the application for LIHTC from HFA.
(e) Upon, or before, completion of the phase
of underwriting prior to submission to the Members, the following actions are
taken and reviews are performed:
(1)
(i) The first of three LIHTC Underwritings
and Feasibility Reviews required by
IRC §42(m)(2)(C) is performed.
(ii) If the eligible basis of all the
buildings in a project divided by the number of units in a project, prior to
any increase for buildings in high cost areas under IRC §42(d)(5)(B) exceeds
the Per Unit Eligible Basis Limit, the eligible basis shall be reduced to the
maximum eligible basis permitted by the Per Unit Eligible Basis Limit unless
the Per Unit Eligible Basis Limit requirement has been waived or is not
applicable to the project.
(2) All applicants must meet the Threshold
Eligibility Requirements listed below.
(3) If an applicant for Private Activity Bond
Credits meets the Threshold Eligibility Requirements listed below, the
application is consistent with this QAP and the application may be considered
by the Members for approval of an allocation of Private Activity Bond
Credits.
(f) After a
project receives the Members' Approval, and after all relevant requirements in
the applicable Term Sheet, and Members' Approval are met, the second LIHTC
Underwriting and Feasibility Review required by Section 42 is performed prior
to the financing for the project.
(1) If the
eligible basis of all the buildings in a project divided by the number of units
in a project, prior to any increase for buildings in high cost areas under IRC
§42 (d)(5)(B), exceedsthe Per Unit Eligible Basis Limit, the eligible basis
shall be reduced to the maximum eligible basis permitted by the Per Unit
Eligible Basis Limit unless the Per Unit Eligible Basis Limit requirement has
been waived or is not applicable to the project.
(2) Projects financed by tax exempt
obligations of the Agency and expected to receive Private Activity Bond Credits
will receive a 42(m) Letter prior to the issuance of the tax -exempt
obligations.
(3) Projects which
have received a Members' Approval of State Credit Ceiling LIHTCs will be issued
a Binding Agreement prior to the financing of the project. The Binding
Agreement must be executed by the applicant and returned to the Agency prior to
the financing. If a project is not financed by the Agency, the Binding
Agreement will incorporate all relevant terms usually contained in Agency
financing documents including the setting of appropriate fees.
(g) Projects receiving State
Credit Ceiling LIHTC must be placed in service during the calendar year of
allocation or obtain a Carryover Allocation Document.
(1) The Cost Certification required to obtain
a Carryover Allocation Document must in form and substance acceptable to the
Agency.
(2) The Cost Certification
must be filed with the Agency by the later of the date which is eleven months
after the date that the allocation was made, unless the Agency grants an
extension of time in writing to file this Cost Certification.
(h) The third and final LIHTC
underwriting and Feasibility Review required by Section 42 is performed prior
to the issuance of the IRS Form or Forms 8609, Low Income Housing Credit
Allocation Certification.
(1) All projects
must provide the Agency with Certificates of Occupancy or Temporary
Certificates of Occupancy as they are issued.
(2) The third and final LIHTC underwriting
and Feasibility Review must be based on a final Cost Certification satisfactory
to the Agency in form and substance and in all ways in compliance with IRC
§42.
(3) The final Cost
Certification must be filed with the Agency within 120 days after the end of
the first year of the credit period for the building within a project with the
latest credit period. The Agency may extend this period in its sole
discretion.
(4) Form or Forms IRS
8609 formally allocating any LIHTC will not be issued until after the third and
final LIHTC underwriting and Feasibility Review, based on a final Cost
Certification satisfactory to the Agency in form and
substance and in all ways in compliance with IRC §42, is completed.
(5) If the eligible basis of all
the buildings in a project divided by the number of units in a project, prior
to any increase for buildings in high cost areas under IRC §42(d)(5)(C),
exceeds the Per Unit Eligible Basis Limit, the eligible basis shall be reduced
to the maximum eligible basis permitted by the Per Unit Eligible Basis Limit
unless the Per Unit Eligible Basis Limit requirement has been waived or is not
applicable to the project.
(i) Projects Financed By Other Issuer's
Private Activity Bonds.
(1) Projects financed
by tax-exempt bonds from an issuer other than the Agency subject to the Private
Activity Bond Volume Cap in accordance with IRC §42(h)(4)(A) may be allowed
LIHTC which is not taken into account under the State Credit Ceiling. The
Agency's Commissioner/CEO, or his or her designee, is hereby authorized to take
any actions necessary and appropriate to allow LIHTC to qualified residential
rental projects located in New York State that are financed by the proceeds of
tax-exempt bonds of an Other Issuer subject to the Private Activity Bond Volume
Cap, where such allowance is consistent with this QAP.
(2) Complete applications for the allowance
of such LIHTC must be submitted at least 60 days prior to the later of the (i)
proposed construction start date or (ii) planned bond sale date in a form
approved by the Agency and will be accepted and processed throughout the
calendar year. The Agency may request any and all information it deems
necessary or appropriate for project evaluation. If, in the Agency's sole
discretion, any submission is incomplete or if documentation is insufficient to
complete any evaluation of the proposed project, processing will be suspended.
In such instances, the Agency will notify the respective applicant of how the
submission is incomplete and provide at least ten business days for the
applicant to submit the requested documentation. Complete applications will be
reviewed relative to criteria contained herein at §
2188.5 for eligibility and public
purpose. Within 60 days after receipt of a complete application the Agency will
issue to the applicant a finding as to whether the application is consistent
with this QAP and the amount of LIHTC for which the project qualifies pursuant
to Financial Feasibility Review. If the application is consistent with this
QAP, the applicant will receive processing instructions for a final allocation
of credit. If the project is found to be inconsistent with this Plan, the owner
will be notified of the reasons for such finding.
(3) The Agency shall charge a reasonable
application fee, due at the time of application. A credit allocation fee, in a
reasonable amount determined by the Agency, also is due upon request for
issuance of IRS Form 8609.Not-for-profit applicants (or their wholly-owned
subsidiaries) which will be the sole general partner or partners of the
partnership/project owner or sole managing member or members of the limited
liability company/project owner may request and be approved for deferral of
payment of the application fee until the construction closing date. All fees
shall be published on the Agency's website, https://hcr.ny.gov/.
(4) In accordance with IRC §42(m)(2)(D), the
issuer of the tax exempt bond financing a project is responsible for
determining the dollar amount of LIHTCs which is necessary for the financial
feasibility of such project and its viability as a qualified low-income housing
project pursuant to Section 42(g)(1) of the Code throughout the applicable
credit period. Such determination must be included in the applicant's request
to the Agency for a final allocation of credit. The Agency will process
requests for a final allocation of credit within 60 days after the date of
receipt of all required documentation including an executed credit regulatory
agreement in a form satisfactory to the Agency with proof of recording. The
Agency will apply the criteria for Feasibility Review and LIHTC Underwriting,
as described herein at §
2188.5(d), in
determining the amount for the final credit allocation with respect to such
project.
(5) Regulatory Term. The
regulatory requirements of projects receiving an allocation or allowance of
LIHTC under the terms of this Plan are described in §
2188.4 of this Plan and shall be
subject to compliance monitoring as described in §
2188.6 of this Plan.
(6) All applicants must meet the Threshold
Eligibility Requirements listed below.
