Program Differences Between LIHTC and Tax-Exempt Bonds

Many sites receive both tax-exempt bond financing and low-income housing tax credits. These sites are, therefore, subject to at least two regulatory agreements with different requirements. Be sure to obtain a copy of all regulatory agreements that may apply to your site.

For compliance purposes, sites are judged by the most restrictive requirements of the applicable programs. It’s important for owners and managers to remember that while there are important similarities between LIHTC and the tax-exempt bond program, there are also differences. Our August feature—available to subscribers here—highlights the compliance differences and points out instances where they may be the same, with respect to:

• Minimum set-aside;
• Time for meeting the minimum set-aside;
• Compliance periods;
• Rent restrictions;
• Income and asset verification;
• Over-income units;
• Student status;
• Utility allowance;
• Reporting requirements;
• Household transfers; and
• Unit sizes.