Development Map: Create a Compliance Blueprint of Your Site

It can be difficult to keep track of compliance requirements on a site with tax credit and market-rate units, especially during a lease-up phase. A development map gives site management a clear visual aid for meeting compliance criteria.

Mapping the development is generally a step that you take after putting together a development binder and creating a summary of the site's compliance criteria (see “Organize Your Site's Compliance Criteria into a Valuable Reference Tool” on p. 1). All it requires is a simple spreadsheet program.

The beauty of using a program like Excel to create the map is that you can put in the formula to calculate the building's applicable fraction, and it will automatically update it as you move tenants in, says housing credit compliance expert Elizabeth Moreland.

It is also a great tool for site staff to use during lease-up. As they meet with applicants, they will have on hand a list of the site's units by type and compliance criteria, and they can see at a glance if there is an appropriate unit available.

We asked Moreland for her recommendations for putting together a development map (see the Model Development Map). She offers the following key pointers:

• Break down the development into its separate buildings. You'll want to create a spreadsheet for each building.

• List the units in each building. Label each unit based on what type of unit it is (for example, one bedroom, one bath; two bedroom, one bath; etc.), and list its square footage.

• Label each unit as either a tax credit or market unit and, in separate columns, list each unit's income limit and rent level.

• Consider adding a column that lists the rent for each unit. “Keep it simple,” Moreland says. “Instead of listing the maximum allowable rent and utility allowance on the map, put in the amount that you want your staff to charge the resident each month so that site staff can then record that amount in the lease.”

• List any additional set-asides for each unit—for instance, if the unit needs to be filled with an individual with disabilities, a homeless person, or if it has any other set-aside attached that will affect who can live in the unit.

Once you have mapped out all of your units and buildings, decide whether to give your staff the flexibility to swap the units without supervisor approval, or whether they need to strictly adhere to the map. “That decision will be based on your site staff's experience and knowledge of tax credits,” Moreland says. “If you have an experienced person on site, giving him the flexibility to move units around will make marketing and lease-up much easier. If you don't, then you may want to establish an approval process for switching units.”

Insider Source

Elizabeth Moreland: Elizabeth Moreland Consulting Services Inc., and the Housing Credit College; (800) 644-0390; moreland@housingcredit.com; www.taxcredit.com.