Organizing for Compliance
These days, the budget to build affordable housing looks like a jigsaw puzzle of local, state, federal and private funding. It is rare that a single housing development has fewer than four or five lenders and/or equity partners. As a consequence, each property has a host of legally-binding regulatory restrictions and reporting requirements. In some cases the lenders' requirements are the same; in many cases they are not. A simple example is when a project has one loan agreement that requires that all the paartments be rented to households earning less than 80% of the area median income, and has a second loan agreement restricting half the apartments to households at less than 50% of median income. One lender might have rules about the project's cash reserves, while another one might not. As a group develops more and more properties and as people come and go, remembering all the restriction, much less complying with them all, becomes more and more difficult.
How to cope? LISC recommends, for starters, that you put together a Compliance Manual for each property, so that all the key documents pertaining to the property are in one easy-to-find place.
Click here to download a "Compliance Manual Table of Contents.doc"
The next step is to comb through these same documents and summarize all the terms and restrictions.
Click here to download "Roles and Responsibilities - Exhibit 1.doc" which is a worksheet that helps summarize terms of each individual finding source.
Click here to download "Roles and Responsibilities - Exhibit 2.doc" to compile your findings about the terms and restrictions from the multiple funding sources that govern a single property.
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Tax Credits for People Who Always Wanted to Know...
The Low Income Housing Tax Credit program has been a great resource for increasing the supply of affordable housing. But if you don't happen to be immersed in housing finance and development, you might still like to know some tax credit basics.
Tax Credit Compliance Quiz
In case you missed the fabulous Tax Credits 101 workshop last month, part of the 2006 Affordable Housing Management Training Series, you can still sharpen your wits and test your knowledge of various rules in Low Income Housing Tax Credit compliance.
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