NH&RA News
By Caitlin Jones
5 min read
Tax Credit Advisor, October 2009:
New IRS Letter Ruling Provides Victory for New Orleans Developer, NH&RA
In a victory for a New Orleans developer and the National Housing & Rehabilitation Association, the Internal Revenue Service has issued a private letter ruling authorizing three buildings that are part of a single redevelopment project to be treated as one for purposes of meeting a key income test under the federal new markets tax credit (NMTC) program.
The letter ruling was requested by an entity created by developer and NH&RA Board Member HRI Properties to acquire, renovate, and construct three adjacent properties on contiguous parcels in downtown Jackson, Miss., into a mixed-use project.
NH&RA several months ago wrote to U.S. Senate Finance Committee leaders to urge Congress to clarify that in the case of multiple-building projects, that the “integrated use test” be applied so that the income test is applied on a project-wide basis, rather than building-by-building.
(See p. 29 for details of letter ruling.)
Association Endorses Coalition Letter on Historic Credit
The National Housing & Rehabilitation Association and one of its councils, the Historic Preservation Development Council, have signed onto a group letter that endorses legislation reflecting specific proposed federal tax law changes to improve the federal 20% historic rehabilitation tax credit. Legislation reflecting the proposals is expected to be introduced in Congress very soon.
The letter, from the Historic Tax Credit Coalition, is signed by many different organizations involved with or supportive of the historic tax credit program.
The Coalition’s proposed legislative changes were developed by consensus by program stakeholders. These changes would amend the historic tax credit to assist smaller projects, allow the credit for moderate-sized rehab projects, loosen restrictions on tax-exempt tenants in credit projects, and provide new incentives for energy-saving improvements in historic buildings. (For details, see Tax Credit Advisor, July 2009, p. 23.)
NH&RA Meets With HUD Official on Market Study Issues
National Housing & Rehabilitation Association representatives met with a senior official of the U.S. Department of Housing and Urban Development (HUD) to request several actions of interest to market analysts for affordable multifamily housing projects, and to members of the National Council of Affordable Housing Market Analysts (NCAHMA). NCAHMA is a council within NH&RA.
Meeting with Carol Galante, the new HUD Deputy Assistant Secretary for Multifamily Housing Programs, NH&RA Executive Director Peter Bell and Executive Vice-President Thom Amdur made several requests. These included to revise HUD policies to enable individuals meeting NCAHMA’s market analyst standards to perform HUD rent comparability studies and market studies for projects seeking FHA-insured loans. In addition, the pair urged revision of FHA market study requirements for low-income housing tax credit projects to conform to industry standards.
In a related activity, NH&RA is educating HUD area economists on NCAHMA and its activities and resources.
NH&RA Signs Onto Coalition LIHTC Letter
The National Housing & Rehabilitation Association has signed on to a letter sent to key members of Congress urging passage of specific proposed legislative changes intended to make the low-income housing tax credit more attractive to corporate investors.
NH&RA joined more than 60 national and state organizations on the “sign on” letter endorsing the proposals. The groups are part of a new coalition called The Affordable Housing Rental A.C.T.I.O.N. (A Call To Invest In Our Neighborhoods).
The proposed changes would amend federal tax law to liberalize the so-called carryback rules to aid current LIHTC investors and entice new investors; broaden the LIHTC investor base to allow owners of more types of business tax entities to fully utilize housing credits; and extend the current low-income housing credit exchange program by one year. (For details on proposed changes, see Tax Credit Advisor, September 2009, p. 3.)
Extensions Urged of Expiring GO Zone Tax Incentives
The National Housing & Rehabilitation Association has urged the chairmen of the two congressional tax-writing committees to introduce legislation to provide a two-year extension of a pair of existing special tax incentives available in the Gulf Opportunity (GO) Zone.
In separate letters to House Ways and Means Committee Chairman Charles Rangel (D-N.Y.) and Senate Finance Committee Chairman Max Baucus (D-Mt.), NH&RA cited the importance of extending the provisions that boosted the historic rehabilitation tax credit from 20% to 26% and established bonus depreciation benefits, for projects in the GO Zone placed in service by year-end 2009.
“We fear that without urgent legislation extending these provisions more than 130 eligible projects located in the GO Zone that are currently seeking to utilize the Historic Tax Credit and/or Bonus Depreciation Depreciation will be put in financial jeopardy,” the letter says. “If these projects fail to materialize, we estimate this will cost the region more than 4,200 construction jobs and 4,300 permanent jobs.”
The letter also suggests a regulatory change to allow the temporary special 26% historic credit rate for qualified rehab expenditures incurred after, as well as before, the sunset date of the higher-rate provision, for projects where at least 10% of the total rehab expenditures occur by the sunset date. This would permit the higher credit rate for all expenditures for projects that are already underway by the sunset.
Social Networking Platforms Are Up and Running
The National Housing & Rehabilitation Association has established a virtual presence on several new fronts.
NH&RA has started a Linked In group for professionals and individuals involved or interested in affordable housing, community development, green building, and related topics. It’s also established a Facebook page, YouTube Channel, and Twitter Feed, to provide information on what the organization is doing and provide news updates and opportunities for information-sharing among participants.
For details, go to http://www.housingonline.com.
