By Jo Ikelheimer, MA, RHM, Director of LIHTC Compliance
Low Income Housing Tax Credit (LIHTC) professionals gathered from across the country in mid-June at the National Council of State Housing Agency’s Housing Credit Connect conference in Atlanta to review the state of our nation’s housing, learn about current issues and trends in affordable programs, and network with each other. As usual, NCHM was attending and participating on panels. The following is an overview of conference activities for those of you involved in the world of LIHTC.
Opening remarks highlighted a slowing growth in the market for renters with a continuing reduction in homeownership, punctuated by that fact that over eleven million renters pay more than fifty percent of their income on their basic housing expenses, rent and utilities. This cost burden has increased at an unprecedented pace this decade, with rental assistance programs unable to keep up with the need. As a result, the number of lowest-income renters far outstrips the availability of rental subsidies. Fortunately, there are plenty of advocates in the industry trying to reverse these trends, including Make Room USA (http://makeroomusa.org), whose goal is to end the rental housing crisis in America. One of its approaches is to connect the names, faces, and true stories of real people with their elected officials to “elevate rental housing on the agendas of our nation’s leaders.”
From there, the conference agenda narrowed down to more specific housing-related compliance topics. These included discussions around LIHTC acquisition and rehabilitation properties, income limits, utility allowances, and income qualification, for which NCHM spoke on a panel presentation. It was noted that income limits trended up this year with 84% of communities seeing increases and only 16% experiencing decreases since the 2016 data was published, reflecting continued improvement in the country’s economy on the whole despite the continued problems of rental affordability.
HUD’s Rental Assistance Demonstration (RAD) program was the subject of several discussions at the conference. RAD is increasingly converting our nation’s existing public housing stock into the Section 8 programs Project Based Vouchers (PBV) and Project Based Rental Assistance (PBRA), and often includes a LIHTC component for rehab purposes. Basic compliance essentials were reviewed for each of these programs at the conference as well.
Finally, one of the hottest topics for LIHTC was covered in a session entitled, “Alphabet Soup: Demystifying HOTMA, VAWA and FHEO Rules. Specifically, the Violence Against Women Act (VAWA) has been on the tax-credit agenda since it was reauthorized in 2013 and was expanded to cover LIHTC properties. With no guidance on this issue forthcoming from the IRS, the general consensus is that VAWA compliance is the responsibility of LIHTC owners who may use HUD’s guidance for their programs as their model. Obviously, if LIHTC is blended with HUD, including the HOME program, then the HUD requirements must be followed and met, but most state housing agencies are not providing specific protocol for VAWA. They are largely encouraging owners to follow HUD’s lead on the issue, including the usage of the VAWA forms, and advising caution with unit transfers and VAWA, understanding that LIHTC transfer policies still hold even if for reasons of domestic violence.
This was also a time to think about what the next year will hold for the LIHTC program. With tax reform high on the agenda in Washington, it will be interesting to see how the fate of the program unfolds over the next months. Hopes are high that LIHTC will hold steady, as it has done in years past, and continue to thrive as the backbone of affordable housing efforts in this country.