Tax Credit Advisor Article Archives

America has a sparkling new mecca for jazz performance and education: the SFJAZZ Center in San Francisco. Sponsored by local nonprofit SFJAZZ and funded largely by federal new markets tax credits, the new $64 million building has quickly become a major attraction for jazz musicians, aficionados, and tourists since the ribbon-cutting on Martin Luther King’s Day.

National Housing & Rehabilitation Association members have a reputation as the most innovative minds in affordable housing, historic preservation, and community development finance. I am constantly impressed by the creative strategies and structures that they use to combine and leverage a myriad of federal, state, and local grant, loan, and tax credit programs to finance their projects.

For years, affordable housing has been at a premium in the City of Fairfax, Va., a high-cost bedroom community of Washington, D.C. Northern Virginia has long seen numerous affordable apartments converted to market-rate apartments or condominiums.

A January 9 ruling by the U.S. Court of Appeals for the Federal Circuit has some tax credit industry participants worried about the use of put options in transactions utilizing federal historic rehabilitation and new markets tax credits. The ruling held that a tax shelter transaction did not have substance due to the “reasonable likelihood” […]

At Castle Square Apartments, a 40-year-old HUD-assisted apartment complex in Boston, WinnDevelopment, in partnership with the tenants association, completed a “deep energy retrofit” that has slashed energy and water usage and drastically cut operating costs and utility bills paid by the owner and tenants. (A deep retrofit is an upgrade reducing prior energy usage by more than 50%.)

Sometimes a revolution happens not with a blare of trumpets but through a thousand small actions in the same direction. Without actually sensing movement, one suddenly realizes the world has become quite different than it was – and is never going back.

As the Housing Credit community rightly celebrates its hard-fought victory for the extension of the fixed 9 percent Housing Credit rate in the American Taxpayer Relief Act and moves into 2013 with a comprehensive strategy for protecting the program in tax reform, we must not lose focus on another important resource that accounts for approximately 40 percent of all annual Housing Credit rental home production.

Throughout my career, my affordable housing colleagues and I have avoided all mention of the Mortgage Interest Deduction (MID). Whatever we might have thought about it privately, in public our lips were sealed.

The passage of the American Taxpayer Relief Act (ATRA) in the final days of the 112th Congress was an important victory for affordable housing and new markets tax credit developers, professionals, and advocates around the country.

Low-cost capital raised from foreign investors under the federal “EB-5” program can help finance new markets tax credit (NMTC) projects, as illustrated by three real estate projects in Texas and Wisconsin.

The affordable housing, community development, and renewable energy industries received a boost with the inclusion of “extender” provisions in the American Taxpayer Relief Act signed into law by President Obama on January 2.

Low-income housing tax credit industry participants, buoyed after the recent legislative “fix” of the 9% credit rate, are cautiously optimistic about the outlook in 2013 for raising equity but anticipate political challenges nationally, according to interviews and speakers’ comments at a recent Washington, D.C. conference held by the National Council of State Housing Agencies.