Frequently Asked Questions about Multifamily Programs
What types of financing does TSAHC currently offer for
multifamily affordable housing developments?
TSAHC currently offers several options for multifamily affordable housing developments
including: 1) Multifamily Direct Lending Program, 2) a 501(c)(3) Bond Program,
and 3) a Private Activity Bond (PAB) Program.
What is Multifamily Direct Lending Program?
TSAHC provides long-term financing to non-profit and for-profit developers
for new and existing multifamily rental properties in order to increase and/or
preserve affordable housing units throughout Texas . TSAHC facilitates this
financing through its relationships with real estate financial institutions
that invest in affordable housing.
How do I apply for financing under the Multifamily Direct
Lending Program?
Click here to view the current term sheet for the Multifamily Direct Lending
Program.
What are the primary differences between the 501(c)(3)
bond program and the Private Activity Bond Program (PAB)?
There are three primary differences between the 501(c)(3) Bond Program and
the PAB Program.
The PAB Program allows both for-profit and non-profit entities
to apply for financing, whereas the 501(c)(3) program requires
the applicant to be organized as a 501(c)(3) non-profit as defined
under the Internal Revenue Code.
The allocation for the PAB Program is limited by the Texas Legislature,
whereas the 501(c)(3) Bond Program has no technical limit, but
is limited at the discretion of TSAHC's Board of Directors.
The Internal Revenue Code allows the combination of PAB with Low
Income Housing Tax Credits (LIHTCs), whereas this is not allowable
with 501(c)(3) bonds.
How do I apply for financing under the Private Activity
Bond (PAB) Program?
Click here to view the current information on the Private Activity Bond Program.
What are the benefits of utilizing TSAHC's Private Activity
Bond (PAB) Program to finance a property?
Unlike local issuers of PABs, TSAHC is not subject to the lottery process directed
by the Texas Bond Review Board. This provides TSAHC with greater flexibility
in the administration of the program.
Is TSAHC's Board of Directors the only board that needs to
approve a proposed development?
If the development entity is not seeking an exemption from ad valorem taxes,
then TSAHC's Board is the only board that needs to approve the proposed development.
If the development entity is a non-profit seeking exemption from ad valorem
taxes, then the Texas Bond Review Board. The Texas Attorney General must approve all state issuances.
Further, TSAHC shares compliance information with the Texas Department
of Housing and Community Affairs (TDHCA). If you have previously
applied for and received any financing award from TDHCA, your compliance
record will be considered in TSAHC's approval process.
How
does TSAHC have the authority to issue tax-exempt bonds?
TSAHC is a quasi-governmental non-profit corporation. As such,
the Texas Legislature gives TSAHC the authority (by statute)
to issue tax-exempt bonds for the purpose of financing affordable
housing.
Is the amount available to TSAHC
in 2005 for its Private Acticity Bond (PAB) Program - $40,300,000– the
amount that will be available each year the program exists?
Not necessarily, the amount available annually is subject to the PAB cap, or “volume
cap.” Currently, the amount of “volume cap” available is based on the population
of the State of Texas and is subject to change from year to year. Note that
this cap does not apply to TSAHC's 501(c)(3) program.
Does TSAHC offer Low Income Housing Tax Credits (LIHTC)?
The LIHTC program may be used in conjunction with Private Activity Bonds, however,
applications for LIHTC allocations must be made through the Texas Department
of Housing and Community Affairs. The Internal Revenue Code does not allow
LIHTCs to be used in conjunction with the 501(c)(3) bond program. (see also http://www.tdhca.state.tx.us/lihtc.htm).
If my application for financing for a multifamily housing
development does not get approval, will my application fees be
refunded?
No, any costs incurred in the application or development process are the sole
responsibility of the applicant.
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