Topic: Compliance

Federal fair housing law bans owners and managers from discriminating against prospects and residents based on race, color, national origin, religion, sex, disability, and familial status. But most states and many municipalities have fair housing laws that ban owners and managers from discriminating against prospects and residents for other reasons. For example, Illinois bans discrimination based on age, marital status, ancestry, and military status or dishonorable discharge. And Chicago bans discrimination based on sexual orientation, parental status, and source of income.

Sexual harassment in housing is illegal, as is harassment based on race, color, religion, national origin, familial status, or disability. The Fair Housing Act prohibits harassment, retaliation, and other types of discrimination based on these protected characteristics.

Households may seek to transfer to different units at a site for various valid reasons. There may be a change in household composition. A household may seek a unit with additional bedrooms due to additional members joining the household. Or a member with a disability may seek a transfer because another unit better meets the needs of that individual. Also, the Violence Against Women Act (VAWA) requires tax credit sites to have emergency transfer plans in place for victims of covered VAWA violence.

While collecting security deposits can provide financial protection to site owners from residents who cause property damage, security deposits can also become a liability to them if they aren’t handled properly. Owners must be careful about where they keep the money residents give them as security deposits. A security deposit is not in the same category as a rent check or other type of payment an owner may receive from a resident. Technically, the security deposit belongs to the resident.

National origin discrimination often involves individuals with limited English proficiency (LEP). The tax credit rules make clear that if any units at your site aren’t “for use by the general public,” those units aren’t eligible for tax credits. To comply, your units must be “rented in a manner consistent with housing policy governing non-discrimination, as evidenced by…the HUD Handbook” [26 CFR §1.42-9]. Chapter 2 of the Handbook outlines the Fair Housing Act’s (FHA) nondiscrimination requirements.

In January, the IRS issued Notice 2021-12 granting relief for various LIHTC requirements. Among the relief provided, the notice extended the deadline for a LIHTC site to meet its first-year occupancy obligations from Dec. 31, 2020, to June 31, 2021, for sites operating on a calendar-year basis. On March 16, the IRS issued Notice 2021-17 clarifying how increases in qualified occupancy six months after year-end affect the ability to claim LIHTCs. We’ll go over what effect the IRS’s recent clarification has on a site’s first-year requirements.

The recent winter storm that battered Texas left many of the state’s residents in dire situations. In the aftermath of the storm, a mass power outage left more than 4 million Texas residents in the dark and cold for days. And as power and heat was restored, the thawing ice exposed broken water pipes in buildings that began to gush water, causing damage and inhabitable living situations. The burst pipes and offline water treatment facilities disrupted water systems serving a majority of the state’s counties.

We explain how renters and owners can access the $25 billion assistance to cover past-due rents. On Dec. 27, 2020, the Consolidated Appropriations Act, the year-end omnibus legislation that includes appropriations for all federal departments and agencies, tax provisions, and much needed COVID-19 relief provisions, was enacted. The relief for those affected by the ongoing COVID-19 pandemic has garnered the most attention.

If so, act fast. The Coronavirus Aid, Relief, and Economic Security (CARES) Act established the Paycheck Protection Program (PPP) to help businesses keep their workforce employed during the pandemic. PPP loans were intended to cover payroll expenses, as well as qualifying rent, utility, and mortgage payments and forgivable in part, under certain conditions. Many not-for-profit 501(c)(3) organizations and management companies have been able to access some of the $500 billion in loans that were disbursed before the program closed in August.

Congressional negotiators recently struck a deal on a bipartisan year-end legislative package, which includes a change that has been advocated by LIHTC proponents for a long time. In the proposed $900 billion federal relief package, lawmakers proposed a floor rate of 4 percent, separating the LIHTC program from borrowing rates set by the Treasury Department. The new floor rate will apply to projects that receive tax credits after Dec. 31.