Ch. 16: Low Income Housing Tax Credit Rule

SECTION 1:INTRODUCTION 1

SECTION 2: HOUSING NEEDS AND PRIORITIES 1

SECTION 3: SET-ASIDES AND MAXIMUM CREDIT AMOUNT 1

SECTION 4: ALLOCATION PROCESS 2

SECTION 5: THRESHOLD REQUIREMENTS 6

SECTION 6: SCORING CRITERIA 12

SECTION 7: PROJECT EVALUATION 22

SECTION 8: ALLOCATION OF CREDIT 24

SECTION 9: TAX-EXEMPT BOND FINANCED PROJECTS 26

SECTION 10: MONITORING 26

SECTION 11: GENERAL 29

STATUTORY AUTHORITY 30

FISCAL IMPACT OF THE RULE: 32

APPENDICES:

APPENDIX A: Definitions

APPENDIX B: Pre-Application Submission Requirements

APPENDIX C: Capital Needs Assessment Requirements

APPENDIX D: Owner’s Certificate of Continuing Program Compliance

APPENDIX E: Requirements for Purchase Options and Rights of First Refusal

APPENDIX F: HUD Policy Requirements

99-346 MAINE STATE HOUSING AUTHORITY

Chapter 16: LOW-INCOME HOUSING TAX CREDIT RULE

SECTION 1: INTRODUCTION

The federal Low-Income Housing Tax Credit (LIHTC) was created by the Tax Reform Act of 1986 to encourage private capital investment in the development of affordable rental housing. It is governed by Section 42 of the Internal Revenue Code of 1986, as amended, and associated regulations. As the designated housing credit agency for the State of Maine, MaineHousing is required by Section 42 of the Code and 30-A MRS §§4741(1) and (14) to adopt a Qualified Allocation Plan (QAP) for allocating and administering LIHTC; this rule is the State’s QAP.

This rule repeals and replaces in its entirety the prior Chapter 16, Low Income Housing Tax Credit Rule, except that the allocation provisions continue to apply to projects that were awarded LIHTC under a prior rule, or a program subject to a prior rule.

Capitalized terms used in this rule are defined in Appendix A, unless the context otherwise indicates, or if not defined therein, have the same meaning as set forth in Section 42 of the Code

y the prior Chapter 16, Low Income Housing Tax Credit Rule, except that the allocation provisions continue to apply to projects that were awarded LIHTC under a prior rule, or a program subject to a prior rule.

Capitalized terms used in this rule are defined in Appendix A, unless the context otherwise indicates, or if not defined therein, have the same meaning as set forth in Section 42 of the Code.

Statement Regarding Cost Control

MaineHousing and its development partners have worked diligently to contain costs while improving the quality of construction and ultimately the livelihoods of Maine people who live in properties funded by LIHTC. The controls on per unit costs and available developer fees are a direct result of this partnership and commitment to controlling costs.

SECTION 2: HOUSING NEEDS AND PRIORITIES

MaineHousing and the Department of Economic and Community Development annually complete a statewide needs assessment as part of the Consolidated Housing and Community Development Plan. Maine Consolidated Plan (2025-2029) establishes the following housing priorities:

expand affordable housing opportunities;

improve and preserve the quality of housing; and

help Maine people attain housing stability.

SECTION 3: SET-ASIDES AND MAXIMUM CREDIT AMOUNT

Nonprofit Set-Aside. MaineHousing will set aside at least ten percent (10%) of the annual State Ceiling for Projects in which a Qualified Nonprofit Organization owns an interest and materially participates in the development and operation throughout the Compliance Period in accordance with Section 42(h)(5)(B) of the Code. An Applicant will qualify if it is owned by either a Qualified Nonprofit Organization, or a business corporation which is 100% owned by one or more Qualified Nonprofit Organization(s), and (in accordance with Section 42(h)(5)(C) of the Code) it is the general partner or manager/managing member and controls the Project’s development and day-to-day operation.

Preservation Set-Aside

B) of the Code. An Applicant will qualify if it is owned by either a Qualified Nonprofit Organization, or a business corporation which is 100% owned by one or more Qualified Nonprofit Organization(s), and (in accordance with Section 42(h)(5)(C) of the Code) it is the general partner or manager/managing member and controls the Project’s development and day-to-day operation.

Preservation Set-Aside. MaineHousing will set aside up to $750,000 of the annual State Ceiling for the preservation and rehabilitation of one existing multifamily rental housing project if the scope of rehabilitation meets the minimum requirements set forth in Section 5.C.2. and one of the following:

at least 25% of its units, or those in a Related Development, are assisted under a Rural Development program; or

at least 25% of its units will be converted to Section 8 under HUD’s Rental Assistance Demonstration (RAD) Program, Section 18 Demolition/Disposition Program or other HUD conversion programs.

Demolition and reconstruction on an existing housing site will be treated as new construction and is not eligible for this set-aside.

Maximum Credit Amount. The maximum amount of Credit that will be allocated for each Project is the least of (i) $30,000 per Credit Unit, (ii) $1,200,000, and (iii) the amount MaineHousing determines is necessary to ensure the Project’s financial feasibility and long-term viability.

SECTION 4: ALLOCATION PROCESS

Pre-Application Submission. Each Project must undergo a mandatory Pre-Application review by MaineHousing to assess its feasibility, suitability for housing, and eligibility for Credit. Applicants must submit the information and documents set forth in Appendix B with the pre-application fee specified in Section 4.C. to MaineHousing by Wednesday, July 2, 2026 for the 2027 round and by Thursday, July 1, 2027 for the 2028 round

Each Project must undergo a mandatory Pre-Application review by MaineHousing to assess its feasibility, suitability for housing, and eligibility for Credit. Applicants must submit the information and documents set forth in Appendix B with the pre-application fee specified in Section 4.C. to MaineHousing by Wednesday, July 2, 2026 for the 2027 round and by Thursday, July 1, 2027 for the 2028 round. An Applicant will not be eligible for Credit if

it fails to provide a complete Pre-Application submission in accordance with this subsection, or

there is any material change in the Project between the Pre-Application submission and the Application unless required by MaineHousing.

Application. Applications are subject to the following limitations, conditions and requirements:

Existing Housing.

Acquisition and Rehabilitation Projects. Projects that involve the acquisition and rehabilitation of Affordable Housing must include the addition of at least 20 new units, or meet the requirements of the Preservation Set-Aside in Section 3.B.

Demolition of Existing Housing. Demolition of existing housing that has not been condemned or declared blight by a municipality is not eligible unless approved by MaineHousing.

Deadline. The deadlines for submitting Applications are Thursday, September 17, 2026 for the 2027 State Ceiling and Thursday, September 16, 2027 for the 2028 State Ceiling.

Format. The Application must be completed and submitted electronically in the form and manner prescribed by MaineHousing. Submitted exhibits must include documentation such as grant award letters, signed documentation on letterhead or evidence of official municipal action to provide evidence of all funding sources and official approvals. MaineHousing may require the Applicant to submit additional information.

Fees. Applicants must pay the following fees when due. All fees are non-refundable

escribed by MaineHousing. Submitted exhibits must include documentation such as grant award letters, signed documentation on letterhead or evidence of official municipal action to provide evidence of all funding sources and official approvals. MaineHousing may require the Applicant to submit additional information.

Fees. Applicants must pay the following fees when due. All fees are non-refundable.

*MaineHousing may charge an additional monitoring fee to cover any increased costs due to income averaging or other extraordinary monitoring requirements during the Compliance Period.

Ineligible Applicants. An Application will be deemed ineligible if one or more of the following has occurred:

The Applicant, any Principal thereof, or Affiliates of either

has an uncorrected IRS Form 8823 in connection with any LIHTC Project to the extent it is correctable unless previously waived by MaineHousing;

has been declared in default or has been 60 calendar days or more delinquent on any loan with MaineHousing, unless the default or delinquency has been cured or there is an approved payment or workout plan in good standing prior to the Application deadline;

has ever been the owner of any project in which MaineHousing has foreclosed a mortgage interest or received a deed-in-lieu of foreclosure of a mortgage interest unless previously waived by MaineHousing;

is presently debarred, suspended, proposed for debarment, or excluded from participation in any federal or state programs;

has sought to achieve early termination of an Extended Use Agreement through the written request to a housing credit agency to present a Qualified Contract;

has in the last 10 years either commenced or had commenced against it any proceeding in or for bankruptcy, receivership, reorganization or any other arrangement for relief from creditors commenced against it that affected a MaineHousing-funded project that was not dismissed within 90 calendar days; or

The tax credit syndicator, investor, or Affiliates of either

transferred its interest in any LIHTC Proj

the last 10 years either commenced or had commenced against it any proceeding in or for bankruptcy, receivership, reorganization or any other arrangement for relief from creditors commenced against it that affected a MaineHousing-funded project that was not dismissed within 90 calendar days; or

The tax credit syndicator, investor, or Affiliates of either

transferred its interest in any LIHTC Project after March 25, 2014 in violation of the Ownership Transfer Rule;

failed to make any required capital contributions with respect to any LIHTC Project, and has not corrected such actions prior to the Application deadline;

has sought to achieve early termination of an Extended Use Agreement through the written request to a housing credit agency to present a Qualified Contract; or

has sought to undermine the exercise of a right of first refusal or purchase option with respect to any LIHTC Project by: (i) refusing to honor a right of first refusal or purchase option; or (ii) involvement in a lawsuit challenging the exercise of a right of first refusal or purchase option.

MaineHousing may reject the Application if it determines the deficiencies are not addressed. MaineHousing may also require financial statements from the Applicant, Principal thereof, or Affiliates of either.

Notice to Local Jurisdiction. Upon receipt of an Application, MaineHousing will notify the Chief Executive Officer of the municipality with jurisdiction over the location of the proposed Project. The notice will provide for a 15-day comment period. MaineHousing will consider any comments received.

Selection Process. Applications for the State Ceiling with the highest scores will be awarded Credit until the applicable State Ceiling is fully awarded.

All Applications that meet the threshold requirements in Section 5 will be scored. Applicants must submit a self-score as part of the Application, which will be reviewed by MaineHousing as part of the selection process

der any comments received.

Selection Process. Applications for the State Ceiling with the highest scores will be awarded Credit until the applicable State Ceiling is fully awarded.

All Applications that meet the threshold requirements in Section 5 will be scored. Applicants must submit a self-score as part of the Application, which will be reviewed by MaineHousing as part of the selection process. Any differences in MaineHousing’s scoring from the Applicants’ self-score will be explained by MaineHousing. Applicants will be afforded five (5) business days to review MaineHousing’s scoring determination and dispute the score if there is a disagreement. Disputes may only be based on evidence submitted with the original Application. Additional information or documentation will not be accepted or considered.

The preservation set-aside is limited to one Project. If the set-aside is not sufficient to complete the Project proposed in the highest scoring eligible Application, MaineHousing may allocate additional Credit, allocate the Credit under the set-aside to the next highest-scoring eligible Application that does not need more than the set aside, or not allocate any Credit under the preservation set-aside. All Applications that participate in the preservation set-aside and do not win will be placed on a waiting list.

The highest scoring Qualified Nonprofit Organization will be the winner of the nonprofit set-aside regardless of its ranking among other Applicants. If the set-aside is not fully awarded to the highest scoring eligible Applicant, MaineHousing may allocate additional Credit to the next highest scoring eligible Applicant for the set-aside, not fully allocate Credit under the set-aside, or require an Applicant that has not indicated that it is participating in the set-aside to participate in the set-aside. MaineHousing may, if necessary, require the Applicant to change its ownership structure

hest scoring eligible Applicant, MaineHousing may allocate additional Credit to the next highest scoring eligible Applicant for the set-aside, not fully allocate Credit under the set-aside, or require an Applicant that has not indicated that it is participating in the set-aside to participate in the set-aside. MaineHousing may, if necessary, require the Applicant to change its ownership structure. All Applications that participate in the nonprofit set-aside and do not win will be scored with the other Applications.

If an individual or entity owns a direct or indirect interest in more than one Applicant, MaineHousing will not award more than 50% of the total projects awarded in any one annual State Ceiling round to Applicants associated with that individual or entity unless there are no additional Applicants under consideration.

Except as set forth above, MaineHousing will make awards in score order to select threshold-eligible Applications. If the last Application selected for an award of Credit needs more Credit than remains under the applicable State Ceiling, MaineHousing may elect to either (a) not award the remaining Credit to any Application, or (b) award additional Credit under the next annual State Ceiling to the Application. All threshold-eligible Applications that are not selected will be placed on a waiting list. Any Credit that is returned or is otherwise unused will be made available to waiting list Applications using this process.

Notice of Award. After scoring is completed and the five-business day Applicant review period expires, MaineHousing will notify the winning Applicants. Within approximately one week of notification, the winning Applicants will receive a Notice of Award and an assignment of MaineHousing staff.

Credit Allocation. Upon receipt of the fully executed Notice of Award, MaineHousing will evaluate the Application pursuant to Section 7 to determine the amount of Credit, if any, to be allocated.

Termination of Application or Notice of Award

ing Applicants. Within approximately one week of notification, the winning Applicants will receive a Notice of Award and an assignment of MaineHousing staff.

Credit Allocation. Upon receipt of the fully executed Notice of Award, MaineHousing will evaluate the Application pursuant to Section 7 to determine the amount of Credit, if any, to be allocated.

Termination of Application or Notice of Award. MaineHousing will deem an Application withdrawn and any Notice of Award cancelled if one or more of the following occur without MaineHousing’s written approval after the Application is submitted:

The Application or the Notice of Award is assigned or the Applicant or any Principal thereof changes;

The location of the Project changes from the location identified in the Application;

There is any change which would result in a net reduction (loss of points) in the Application’s score;

There is a change in the Project’s design or financing from what was in the Application which results in a substantial increase in the amount of Credit or other MaineHousing funding required;

The Project’s TDC Index exceeds the TDC Index Cap;

Failure to meet the threshold requirements in Section 5;

Any event in Section 4.D. occurs and is not cured within any applicable cure period;

The Project is determined to be infeasible by MaineHousing, meaning the Applicant has not demonstrated the financial ability to develop and complete the Project and operate it through the Compliance Period; or

There is any other material or substantive amendment or change to the Application.

SECTION 5: THRESHOLD REQUIREMENTS

Applications must meet the following threshold requirements to be eligible for Credit:

Affordability

o be infeasible by MaineHousing, meaning the Applicant has not demonstrated the financial ability to develop and complete the Project and operate it through the Compliance Period; or

There is any other material or substantive amendment or change to the Application.

SECTION 5: THRESHOLD REQUIREMENTS

Applications must meet the following threshold requirements to be eligible for Credit:

Affordability.

The Project will comply with Section 42 of the Code and this QAP for a minimum period of 45 years to maintain the Project as residential rental housing, keep at least 60% of the total Credit Units in a Project occupied by persons with 50% area median income and keep the Credit Units in the Project rent-restricted in accordance with Section 42 of the Code.

The Applicant waives the right to request MaineHousing to present a Qualified Contract under Section 42(h)(6) of the Code.

The Applicant must submit a letter of intent from an investor (and, in the event of any change in investor, the replacement investor) in which the investor agrees to the granting of an option to purchase: (i) the Project; and (ii) the partnership interest of the limited partner(s) or membership interest of the non-managing member(s) of the Project owner (“Purchase Options”), to one or more of the general partner, managing member, developer or sponsor on terms that at a minimum satisfy the threshold requirements set forth in Appendix E. The investor must also agree in the letter of intent that the Purchase Options complying at a minimum with the threshold requirements in Appendix E will be included in the Project owner’s limited partnership agreement or limited liability company operating agreement

artner, managing member, developer or sponsor on terms that at a minimum satisfy the threshold requirements set forth in Appendix E. The investor must also agree in the letter of intent that the Purchase Options complying at a minimum with the threshold requirements in Appendix E will be included in the Project owner’s limited partnership agreement or limited liability company operating agreement.

If the Applicant, general partner, managing member, developer, or sponsor of the Project is a Qualified Nonprofit Organization, the Applicant must submit a letter of intent from an investor (and, in the event of any change in investor, the replacement investor) in which the investor agrees to the granting of a right of first refusal (“ROFR”) to the Qualified Nonprofit Organization on terms that at a minimum satisfy the threshold requirements set forth in Appendix E. The investor must also agree in the letter of intent that the ROFR complying at a minimum with the threshold requirements in Appendix E will be included in the Project owner’s limited partnership agreement or limited liability company operating agreement.

Total Development Cost (TDC). Cost reasonableness will be evaluated using an index, which is the weighted average of the TDC per unit and the TDC per bedroom. For mixed-use projects, the TDC for only the residential portion of the project, including common areas, will be used for this calculation. The weighted average will be calculated as follows:

([2 X TDC/unit] + [TDC/bedroom]) divided by 3.

The product of this calculation will be referred to throughout this document as the “TDC Index”. An Application will be rejected if the TDC Index exceeds the TDC Index Cap below for a project of its type at any time prior to the later of the construction loan closing or carryover allocation.

**For 2028, MaineHousing will review the Consumer Price Index for New England and adjust the TDC Index Caps accordingly to reflect market adjustments

erred to throughout this document as the “TDC Index”. An Application will be rejected if the TDC Index exceeds the TDC Index Cap below for a project of its type at any time prior to the later of the construction loan closing or carryover allocation.

**For 2028, MaineHousing will review the Consumer Price Index for New England and adjust the TDC Index Caps accordingly to reflect market adjustments.

Demolition and reconstruction of all housing on the same site or another site will be treated as new construction. If a Project involves more than one project type, the TDC Index Cap for the Project is the average of the TDC Index Caps allocable to each type, weighted by the number of units of each type.

Acquisition and Rehabilitation of Existing Housing. Projects that involve the acquisition and rehabilitation of existing multifamily housing are subject to the following:

Capital Needs Assessment. The Application must include a capital needs assessment satisfying the requirements set forth in Appendix C.

Minimum Rehabilitation Requirements. The Rehabilitation Costs per unit of existing housing must be at least $75,000.

Relocation/Displacement. The Project must comply with MaineHousing’s Temporary Relocation and Permanent Displacement Policies and, if the Project is federally-assisted, all applicable federal requirements, including the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, as amended. The Applicant must take reasonable steps to minimize the displacement of existing tenants of the Project. The Application must identify any tenants who will be permanently displaced and the reason for the displacement. The Project’s TDC must include all costs associated with permanent and temporary displacement or relocation. MaineHousing will not allocate Credit until it has approved a project’s relocation plan.

D. Development and Management Experience and Capacity

f existing tenants of the Project. The Application must identify any tenants who will be permanently displaced and the reason for the displacement. The Project’s TDC must include all costs associated with permanent and temporary displacement or relocation. MaineHousing will not allocate Credit until it has approved a project’s relocation plan.

D. Development and Management Experience and Capacity. Applicant teams must have sufficient knowledge, experience and capacity to adequately design, develop, complete, maintain, manage, and operate LIHTC Projects and provide related services, such as accounting, tax and legal advice, and resident service coordination. If the Project will involve multiple subsidy sources in addition to LIHTC, which results in overlapping targeting and rental restrictions, the Applicant team must have sufficient knowledge, experience and capacity to handle the increased complexity. If MaineHousing determines the Applicant’s team lacks sufficient qualifications, the team may be required to

hire a qualified consultant,

hire additional qualified staff, or

replace a team member.

Site Control. The Applicant must have site control of the Project throughout the Application process in the form of an option, a purchase and sale contract, ownership, or long-term lease. The Applicant, its agents, and MaineHousing must have access to the Project site, and if the Project is an existing occupied property, access to records and other information about the existing tenants, including current rent and income information.

Growth Management Limitations. A Project that involves the new construction or acquisition of newly-constructed residential rental property or the conversion of existing buildings to residential rental property must comply with the State’s Growth Management Law, 5 M.R.S. §3234, as amended

s to records and other information about the existing tenants, including current rent and income information.

Growth Management Limitations. A Project that involves the new construction or acquisition of newly-constructed residential rental property or the conversion of existing buildings to residential rental property must comply with the State’s Growth Management Law, 5 M.R.S. §3234, as amended. Projects must meet one of the following two sets of criteria to be eligible for a Credit allocation:

If the municipality in which the Project is located has adopted a comprehensive plan or growth management plan that is consistent with applicable State law, then the Project must be in a designated growth area as identified in such plan; or

Otherwise the Project must be located in an area

served by a public sewer system with existing capacity for the Project,

identified as a census-designated place in the latest Federal Decennial Census, or

in an urban municipality and defined under 23 M.R.S. §754 as compact.

The law exempts projects that exclusively serve certain populations, such as persons with disabilities, who are homeless, or are wards of the State.

Project Feasibility. The Applicant must have the financial ability to develop and complete the Project and to operate it throughout the Compliance Period.

Development Budget. The Applicant must identify all

sources of funding for development and completion, whether direct or indirect, including the amount, timing, terms, conditions, and status (e.g. “applied for” or “committed”) as of the date of the Application and uses of the funding based on the projected costs of and schedule for developing and completing the Project; and

sources and uses of funding for the Project, whether direct or indirect and whether they are included in the development budget for the Project.

Operating Budget

ng the amount, timing, terms, conditions, and status (e.g. “applied for” or “committed”) as of the date of the Application and uses of the funding based on the projected costs of and schedule for developing and completing the Project; and

sources and uses of funding for the Project, whether direct or indirect and whether they are included in the development budget for the Project.

Operating Budget. The Applicant must identify all

sources of income, including rent from the residential units, any income from commercial or non-residential space, and the amount, terms and conditions of rental or operating assistance; and

costs of operating the Project as projected over the Compliance Period. The Applicant also must identify all forms of property tax relief (such as a PILOT, tax abatement or exemption, or Tax Increment Financing) and other assistance that reduces operating costs.

Related Development. Any Related Development must be completed prior to or concurrently with the completion of the Project, and there must be sufficient funding to operate the Related Development.

If MaineHousing determines that the Application includes information that is inconsistent with applicable requirements or is unreasonable based on comparable LIHTC projects, industry standards, or market conditions, MaineHousing may where it deems appropriate re-characterize such information to assess Project Feasibility notwithstanding the identified issue with the information provided.

Phased Projects. Applicants may not submit an Application for more than one phase of a multi-phase Project in an Application round. If a single phase of a multi-phase project is awarded Credit, it must comply with the timeline in the Notice of Award and cannot be delayed to align with a potential award of a future phase. If a delay occurs that is beyond the Applicant’s control, MaineHousing, in its sole discretion, may authorize a modification to the Notice of Award to allow for an extension of the Project timeline.

Project Design and Construction Requirements

project is awarded Credit, it must comply with the timeline in the Notice of Award and cannot be delayed to align with a potential award of a future phase. If a delay occurs that is beyond the Applicant’s control, MaineHousing, in its sole discretion, may authorize a modification to the Notice of Award to allow for an extension of the Project timeline.

Project Design and Construction Requirements. The design and construction or rehabilitation of the Project must comply with MaineHousing’s Construction Standards and all applicable local, state and federal codes, regulations, statutes and ordinances. The latest version of Construction Services’ Quality Standards and Procedures Manual can be found here:

https://www.mainehousing.org/programs-services/housing-development/construction-services

When applicable, Projects must also comply with:

The Build America, Buy America Act (BABA), enacted as part of the Infrastructure Investment and Jobs Act, Infrastructure Investment and Jobs Act, Pub. L. 117-58 and 2 CFR 184. BABA established a domestic content procurement preference for all Federal financial assistance obligated for infrastructure projects after May 14, 2022.  The domestic content procurement preference requires that all iron, steel, manufactured products, and construction materials used in covered infrastructure projects are produced in the United States. This requirement is known as the “Buy America Preference” (BAP).

BABA FAQs

https://www.hudexchange.info/baba/faqs/?utm_source=HUD+Exchange+Mailing+List&utm_campaign=87c88d5f1e-BABA-FAQs-Now-Available-3.4.24&utm_medium=email&utm_term=0_-87c88d5f1e-%5BLIST_EMAIL_ID%5D

Section 3 of the Housing and Development Act of 1968 (12 U.S.C § 1701u) and its associated regulations (24 C.F.R. Part 75)

ed States. This requirement is known as the “Buy America Preference” (BAP).

BABA FAQs

https://www.hudexchange.info/baba/faqs/?utm_source=HUD+Exchange+Mailing+List&utm_campaign=87c88d5f1e-BABA-FAQs-Now-Available-3.4.24&utm_medium=email&utm_term=0_-87c88d5f1e-%5BLIST_EMAIL_ID%5D

Section 3 of the Housing and Development Act of 1968 (12 U.S.C § 1701u) and its associated regulations (24 C.F.R. Part 75). The Section 3 program requires that recipients of certain HUD financial assistance, to the greatest extent possible, provide training, employment, contracting and other economic opportunities to low- and very low-income persons, especially recipients of government assistance for housing, and to businesses that provide economic opportunities to low- and very low-income persons.

Please refer to the Section 3 Contractor, Subcontractor and Subrecipient Package on our website:

https://mainehousing.org/docs/default-source/development/construction-services/other-documents/section-3-contractor-subcontractor-subrecipient-package.pdf?sfvrsn=26f28615_5

Project Amenities. The Project must have the following amenities and services:

Community Room. The Project must include an on-site community room with sufficient capacity to serve tenants’ needs. For a scattered-site Project, only one community room is required and should be centrally located to the greatest extent possible to best serve all tenants.

Laundry Facilities. The Project must include either a washer/dryer hook-up in each unit or a fully accessible, centrally located laundry facility with sufficient capacity to serve all tenants.

Broadband Access. The Project must include broadband infrastructure with capacity sufficient to support the provision of Telehealth services

located to the greatest extent possible to best serve all tenants.

Laundry Facilities. The Project must include either a washer/dryer hook-up in each unit or a fully accessible, centrally located laundry facility with sufficient capacity to serve all tenants.

Broadband Access. The Project must include broadband infrastructure with capacity sufficient to support the provision of Telehealth services.

Broadband infrastructure includes cables, fiber optics, CAT5e (or greater) interior wiring, or other permanent (integral to the structure) infrastructure, including wireless infrastructure, as long as the installation results in broadband infrastructure in each dwelling unit sufficient for the build-to standard of The Maine Connectivity Authority.

Healthcare service providers and the tenants receiving care may not be charged for the use of the internet or wireless and telephone services provided for telemedicine services.

Shared Facilities. An amenity will meet the requirements if the amenity:

is fully accessible and located on an accessible path to the Project;

is within an existing multifamily housing project adjacent to the subject site,

has sufficient capacity to serve both the Project’s tenants and the existing project,

will be available to the Project’s tenants during the Compliance Period on the same terms as the residents of the existing multifamily project, and

will not charge the tenants to use the shared amenity other than a reasonable fee that does not exceed the amount charged to any others for the same use.

Recreational Activities. An area(s) of recreational activity must be located on the Project site or within a ½ mile. The area(s) and activities must be free of charge to the tenants and not require membership. Projects with single-family detached style units satisfy this requirement if each unit has a private lawn with sufficient room for playground equipment, gardening or other activities acceptable to MaineHousing.

Exceptions

a(s) of recreational activity must be located on the Project site or within a ½ mile. The area(s) and activities must be free of charge to the tenants and not require membership. Projects with single-family detached style units satisfy this requirement if each unit has a private lawn with sufficient room for playground equipment, gardening or other activities acceptable to MaineHousing.

Exceptions. The requirements of this subsection do not apply to existing multifamily housing projects if the Applicant cannot comply with the requirements because of the nature of the site, structural limitations, zoning restrictions or other land use limitations.

Resident Service Coordination. The Applicant must make a resident service coordinator available twice weekly to the tenants on-site a minimum of one (1) hour per week for every five (5) Credit Units. The coordinator shall meet with tenants in a private and confidential manner to evaluate individual needs and make appropriate referrals. The services provided must be free of charge to the tenants. The Applicant must maintain adequate funding throughout the Compliance Period.

Smoke-free Housing. The Applicant must

implement a written occupancy policy prohibiting smoking in the units and common areas,

include a non-smoking clause in the lease for every household, and

make educational materials on tobacco treatment programs (including the phone number for the statewide Maine Tobacco HelpLine) available to all tenants through the resident service coordinator.

Waiting List Preference. The Applicant must give an occupancy preference to eligible persons whose names are on a public housing or Section 8 waiting list, except for Projects: (i) financed by Rural Development, or (ii) with Section 8 Project-Based Rental Assistance (preference will apply to any Credit Unit without project-based rental assistance).

SECTION 6: SCORING CRITERIA

The Applicant must complete all information and submit all documentation required to be eligible for points

ersons whose names are on a public housing or Section 8 waiting list, except for Projects: (i) financed by Rural Development, or (ii) with Section 8 Project-Based Rental Assistance (preference will apply to any Credit Unit without project-based rental assistance).

SECTION 6: SCORING CRITERIA

The Applicant must complete all information and submit all documentation required to be eligible for points.

Project Characteristics

Rehabilitation or Reuse of Existing Housing, Structure or Site. Up to 4 Points

The Project site exhibits one or more of the following characteristics (2 points for each that applies, up to 4 points total):

Rehabilitation of existing rental housing containing 5 or more units without permanently displacing any existing tenants or increasing their housing costs (including rent and all other charges paid by the tenant) by more than 10%;

Rehabilitation, remediation, or reuse of an existing building or structure that has a current use other than multifamily rental housing;

One or more buildings or structures used for purposes other than single family residential housing or agriculture purposes, have been or will be demolished or removed for purposes of redeveloping the site;

Lots left vacant or nearly vacant in the development of a downtown or other city or town center, such as vacant lots or parking lots abutting commercial buildings and/or multifamily rental housing. Vacant lots in single-family residential areas are not eligible for points under this subsection. Undeveloped portions of existing sites are not eligible for points unless the existing project on the site previously satisfied one of the above criteria; or

Specifically designated by a municipality’s elected body, planning board, or zoning board for redevelopment to renew a blighted area (as defined by 30-A M.R.S. §5153) or remediate environmental risks to the occupants.

Historic Rehabilitation

Undeveloped portions of existing sites are not eligible for points unless the existing project on the site previously satisfied one of the above criteria; or

Specifically designated by a municipality’s elected body, planning board, or zoning board for redevelopment to renew a blighted area (as defined by 30-A M.R.S. §5153) or remediate environmental risks to the occupants.

Historic Rehabilitation. 5 points

The Project includes the rehabilitation of a certified historic structure using capital contributions generated from federal and state historic rehabilitation tax credits.

Projects Using Wood Fiber Insulation. 1 point

The Applicant pledges that a minimum of 50% of the square footage of each building’s exterior thermal envelope will include wood fiber insulation unless it is deemed by MaineHousing, in its sole discretion, that it is infeasible due to either costs or supply chain delays.

Populations with Special Needs. 3 points

The Project gives an occupancy preference for at least 20% of all the units, but not less than 4 of the units, for Persons Experiencing Homelessness or persons who have disabilities, are victims of domestic violence, or have other special housing needs, to create permanent supportive housing for persons who require that level of intervention within the special needs populations.

The Applicant must commit to maintaining a separate waiting list for these units and make appropriate, voluntary services available through a qualified third-party provider other than the resident service coordinator required under Section 5.K. Project-Based Vouchers will not be available from MaineHousing for preference units, except in situations where an Applicant receives funding from the National Housing Trust Fund as described below in Section G.

Family Housing. Up to 6 points

The Project is for families and a minimum percentage of the Credit Units are two and/or three or more bedroom units as follows:

Accessibility

ection 5.K. Project-Based Vouchers will not be available from MaineHousing for preference units, except in situations where an Applicant receives funding from the National Housing Trust Fund as described below in Section G.

Family Housing. Up to 6 points

The Project is for families and a minimum percentage of the Credit Units are two and/or three or more bedroom units as follows:

Accessibility. Up to 12 points

One (1) point for each unit that

exceeds the minimum number of such units required by applicable federal and state accessibility laws, and

meets the requirements for a Type A unit under ANSI Standard A117.1-2009, up to the maximum points by project type below.

Financial Characteristics

National Housing Trust Fund. 3 points

The Applicant agrees to accept and use any funding from MaineHousing’s National Housing Trust Fund program for the Project. Any funding award will require a certain number of units in the Project to be affordable to and occupied by Extremely Low Income households. Project-Based Vouchers will be made available for the minimum number of required National Housing Trust Fund units, as determined by MaineHousing. National Housing Trust Fund awards require a Part 93 Environmental Review and Project-Based Vouchers require a Part 58 Environmental Review. Applicants should review the requirements before agreeing to accept funding, to avoid withdrawal of an Application if the requirements cannot be met. Awarding points is not a commitment of funding from the National Housing Trust Fund.

Acquisition Cost

ousing. National Housing Trust Fund awards require a Part 93 Environmental Review and Project-Based Vouchers require a Part 58 Environmental Review. Applicants should review the requirements before agreeing to accept funding, to avoid withdrawal of an Application if the requirements cannot be met. Awarding points is not a commitment of funding from the National Housing Trust Fund.

Acquisition Cost. Up to 5 points

Points are based on the percentage by which the acquisition costs are less than the average acquisition costs for a project of its type as follows:

For purposes of this subsection, acquisition costs include

the purchase price for all of the land and any existing building(s) even if donated or leased to the Applicant at below market value,

the cost of razing or demolishing any building(s) and structure(s), or any part thereof, on the Project site, and

the Capitalized Lease Value of all leases of land or land and building(s) that are part of the Project, with the exception of parking spaces.

The value of any project reserves transferred to the Project as part of the acquisition and included in the purchase price will not be included for purposes of this subsection.

Property Tax Relief. Up to 3 points

Points are based on the percentage of the Project’s annual incremental property tax revenue returned to the Applicant or foregone by the taxing authority as follows:

Only Tax Increment Financing, payment in lieu of taxes, abatement, or other property tax relief arrangement approved by the taxing authority and all other applicable governing entities are eligible. A Project that is either a) located in a jurisdiction that does not assess property taxes or b) exempt from property taxes will be awarded one (1) point

or foregone by the taxing authority as follows:

Only Tax Increment Financing, payment in lieu of taxes, abatement, or other property tax relief arrangement approved by the taxing authority and all other applicable governing entities are eligible. A Project that is either a) located in a jurisdiction that does not assess property taxes or b) exempt from property taxes will be awarded one (1) point.

Funding made possible by an Affordable Housing will not be eligible unless the Applicant submits a complete application for the Affordable Housing TIF to TIFs@mainehousing.org at least 30 calendar days before the applicable Application deadline (for the 2027 State Ceiling no later than Tuesday, August 15, 2026 and for the 2028 State Ceiling no later than Tuesday, August 14, 2027). In order to count an Affordable Housing TIF application as “complete”, the application must include all of the information required by MaineHousing’s Affordable TIF Application Form and the Affordable Housing TIF Development Plan must have been approved by the relevant municipality. Points will not be awarded for an Affordable Housing TIF unless it is ultimately approved by MaineHousing, even if it was submitted before the applicable deadline.

Project Location

Housing Need. Up to 10 points

Points are based on the need for the type of housing in an area as follows:

Projects providing Housing for Older Adults located in the following Communities:

Other Housing Projects in the following Communities:

Projects located on Native American tribal lands will be awarded 8 points.

For the Applications submitted under the 2027-2028 QAP, Applicants may receive

the Housing Needs score outlined in the 2025-2026 QAP for the municipality in

which the Project is located, if that municipality saw a decrease in score in the 2027

2028 QAP.

Community Revitalization

Housing Projects in the following Communities:

Projects located on Native American tribal lands will be awarded 8 points.

For the Applications submitted under the 2027-2028 QAP, Applicants may receive

the Housing Needs score outlined in the 2025-2026 QAP for the municipality in

which the Project is located, if that municipality saw a decrease in score in the 2027

2028 QAP.

Community Revitalization. Up to 5 points

Two (2) points if the Project is located within the boundaries of and contributes to the revitalization goals and efforts identified in a municipality’s comprehensive plan or a Community Revitalization Plan.

Two (2) points if the Project is located in a QCT and at least 20% of the units are market rate.

One (1) extra point if the Project also involves the preservation of existing Affordable Housing.

Smart Growth. Up to 10 points

Sponsor Characteristics

Readiness. Up to 10 points

MaineHousing must approve both the design to be submitted to the municipality and the State and the final design, including all plans, details and specifications. The Project and any Related Developments must have all

municipal land use approvals (except building and other permits 5 points

customarily issued during construction), and

State land use approvals (such as site plan, subdivision, storm 5 points

water, or wetlands approvals) required to proceed with and complete construction.

As of the Application date, the timeframe to appeal all such approvals must have expired with no appellate action being taken, or all appeals have been resolved.

Developer Capacity. Up to 5 points

Points are based on the development experience of the Applicant, any Principal thereof, or Affiliates of either as follows:

Owner Performance. Up to a 5 Point loss

Points reductions are based on the recent performance of the Applicant

pprovals must have expired with no appellate action being taken, or all appeals have been resolved.

Developer Capacity. Up to 5 points

Points are based on the development experience of the Applicant, any Principal thereof, or Affiliates of either as follows:

Owner Performance. Up to a 5 Point loss

Points reductions are based on the recent performance of the Applicant. MaineHousing may reject the Application if it determines outstanding deficiencies are not addressed, or require financial statements from the Applicant, Principals thereof, or Affiliates.

Management Experience. Up to 2 points

The company that will manage the Project has at least

Management Performance. Up to a 3 point loss

Point reductions for Management Companies are based on instances of poor performance measured by their management of LIHTC Projects in their portfolio that remain in their LIHTC Compliance Period as of the June 30 immediately preceding the Application deadline.

Tie Breaker.

If more than one Application has the same score, the Application for the least amount of Credit and 0% deferred debt from MaineHousing per unit will have priority. If the Applications request the same amount of these resources, the Application with the most acceptable plan to convert the Project to affordable homeownership for the residents after the Extended Use Period will have priority. The plan must describe the process for transferring ownership to the residents, the purchase price or process for determining it, any financial assistance available for residents (including any reserves), how the affordability will be maintained, and must provide for homebuyer counseling and professional representation of the residents at the time of the conversion.

S. Review Process.

MaineHousing will notify each Applicant of its initial score in writing

he residents, the purchase price or process for determining it, any financial assistance available for residents (including any reserves), how the affordability will be maintained, and must provide for homebuyer counseling and professional representation of the residents at the time of the conversion.

S. Review Process.

MaineHousing will notify each Applicant of its initial score in writing. If MaineHousing assigns a score in a scoring category which is lower than the score the Applicant assigned itself in the scoring category, the Applicant will have five business days from such written notice to demonstrate to MaineHousing that the Application as submitted should receive the higher score. MaineHousing will then make a final determination of scores and the ranking of Applications.

SECTION 7: PROJECT EVALUATION

Amount of Credit. The amount of Credit allocated will be determined as follows:

The calculation of the amount of Credit will be based on 130% of Eligible Basis. MaineHousing has designated the entire State and all buildings therein, as a DDA under Section 42(d)(5)(B)(v) of the Code because of the high cost of developing housing, the low median income, and the high annual operating costs for housing relative to other states;

To determine the amount of Credit, MaineHousing will use the lesser of (a) the market rent, based on the Application market study as approved by MaineHousing, and (b) the maximum Credit rent. For three or more bedroom units MaineHousing will use the maximum Credit rent for two-bedroom units plus $50.00;

The amount of Credit allocated for a Project will not exceed the least of

the amount the Project is eligible to receive under Section 42 of the Code,

the amount MaineHousing determines is necessary for financial feasibility and viability throughout the Credit Period, and

the Maximum Credit Amount;

The Applicant must submit financial and all other required information

wo-bedroom units plus $50.00;

The amount of Credit allocated for a Project will not exceed the least of

the amount the Project is eligible to receive under Section 42 of the Code,

the amount MaineHousing determines is necessary for financial feasibility and viability throughout the Credit Period, and

the Maximum Credit Amount;

The Applicant must submit financial and all other required information. MaineHousing will evaluate the need for Credit based on

all sources of financing, including the terms and conditions,

equity expected to be generated by reason of tax benefits, and

the uses of funds, including the reasonableness of development costs and operating expenditures; and

In order to determine the amount of Credit, MaineHousing must identify a gap between development sources and uses absent a Credit allocation. MaineHousing may limit recognition of Intermediary Costs, re-characterize Project sources and uses and make reasonable assumptions with respect to projected revenues and expenses. MaineHousing will also take into consideration any federal limitations when combining the Credit with other federal assistance (i.e. “subsidy layering” guidelines).

Developer Fee. Developer Fee will be determined as follows:

Maximum Developer Fee. The total Developer Fee may not exceed the sum of 15% of the Housing Development Costs, plus 10% of the costs of acquisition of land, existing buildings and equipment, determined without regard to the Developer Fee.

2. Net Developer Fee. The amount of Developer Fee not deferred may not exceed $750,000 plus any unused construction contingency returned to the Applicant after completion.

3. Additional Developer Fee

Fee may not exceed the sum of 15% of the Housing Development Costs, plus 10% of the costs of acquisition of land, existing buildings and equipment, determined without regard to the Developer Fee.

2. Net Developer Fee. The amount of Developer Fee not deferred may not exceed $750,000 plus any unused construction contingency returned to the Applicant after completion.

3. Additional Developer Fee. An Applicant is eligible for Developer Fee in excess of the Net Developer Fee calculated above only if it is deferred and used to:

increase the tax credit equity generated for the Project (this will not be included in the TDC Index calculation); or

reduce the taxable surplus cash distributions and increase the losses to the syndicator thereby improving the economics of the Project, within the following parameters: Additional Developer Fee up to $20,000 per LIHTC unit may be excluded from the TDC Index calculation.

Any Developer Fee that is deferred shall not be interest-bearing or secured by a mortgage

on the Project.

General Contractor Intermediary Costs. The general contractor’s Intermediary Costs must be:

separated from other construction and rehabilitation costs,

with general conditions and overhead and profit parsed out, and

no more than 14% of the Total Construction Cost, within the following ranges:

a) General conditions up to 6% of Total Construction Cost, and

b) Overhead and profit up to 8% of Total Construction Cost

Time of Credit Determination. MaineHousing will determine the amount of Credit at the time of

Application, which will be evidenced by the Notice of Award;

the allocation of Credit, including any carryover allocation;

the date each Qualified Building is Placed in Service; and

if a Qualified Building is allocated Credit pursuant to Section 9, the date of issuance of the tax-exempt bonds.

Prior to each determination, the Applicant must certify the full amounts of all funding sources and provide any other information required by MaineHousing.

Market Study

e allocation of Credit, including any carryover allocation;

the date each Qualified Building is Placed in Service; and

if a Qualified Building is allocated Credit pursuant to Section 9, the date of issuance of the tax-exempt bonds.

Prior to each determination, the Applicant must certify the full amounts of all funding sources and provide any other information required by MaineHousing.

Market Study. The applicant must submit a comprehensive market study prepared by a qualified professional in accordance with the National Council of Housing Market Analysis Model Standards for Market Studies for Rental Housing. MaineHousing may require the Applicant to either correct any inadequacies it identifies or submit a new market study. MaineHousing also may elect to commission its own market study.

Construction Cost Increases. MaineHousing may allocate additional Credit to a Project if its construction costs increase after the Application date and the increase is the result of market conditions or other circumstances beyond the Applicant’s control. Any additional Credit will not exceed an amount necessary to generate equity equal to 5% of the Total Construction Cost based on construction bids.

SECTION 8: ALLOCATION OF CREDIT

Allocation. MaineHousing will issue one or more IRS Form(s) 8609 after receipt of the following:

A complete request for allocation of Credit in a form prescribed by MaineHousing.

An audit report on the schedule of project costs prepared by an independent, third party certified public accountant including all associated costs (such as commissions, due diligence, legal, accounting, reserves, and other similar items).

Certification of the Project’s sources, including all federal, state and local subsidies in any stage of commitment. This certification must include income, operating and development cost projections and methods for satisfying any deficits.

The allocation fee and monitoring fee less the amount of any allocation fee paid in connection with the issuance of a carryover allocation

her similar items).

Certification of the Project’s sources, including all federal, state and local subsidies in any stage of commitment. This certification must include income, operating and development cost projections and methods for satisfying any deficits.

The allocation fee and monitoring fee less the amount of any allocation fee paid in connection with the issuance of a carryover allocation.

Carryover Allocation.

The Applicant must submit the following to receive a carryover allocation:

A complete request for carryover allocation in the form prescribed by MaineHousing no later than the first day of December of the year in which the carryover allocation is made.

Certification of the Project’s sources, including all federal, state and local funding. This certification must include income, operating and development cost projections and methods for satisfying any deficits.

Development progress report, including completion likelihood.

The applicant must execute a carryover allocation and return it to MaineHousing, together with the allocation fee, no later than December 31 of the year in which the carryover allocation is made.

A carryover allocation will be subject to the following conditions:

satisfactory evidence that more than 10% of the Project’s reasonably expected basis is incurred within 12 months of the carryover allocation, including an audit report prepared by an independent, certified public accountant; and

any performance conditions MaineHousing may require.

Failure to comply with these conditions may result in termination of the carryover allocation.

Tax Credit Compliance Experience. Prior to an allocation the Applicant must demonstrate that the entity managing the Project has sufficient Credit compliance experience and training. The entity must complete a Credit compliance training or receive a certification from a MaineHousing-approved trainer.

Extended Use Agreement

ith these conditions may result in termination of the carryover allocation.

Tax Credit Compliance Experience. Prior to an allocation the Applicant must demonstrate that the entity managing the Project has sufficient Credit compliance experience and training. The entity must complete a Credit compliance training or receive a certification from a MaineHousing-approved trainer.

Extended Use Agreement. Prior to an allocation of Credit, the Owner must enter into an Extended Use Agreement with MaineHousing obligating the Owner to comply with Section 42 of the Code, the threshold requirements in Section 5, and commitments for which the Application was awarded points. The Extended Use Agreement must be recorded in the appropriate registry of deeds prior to all mortgage liens and encumbrances on the Project and before MaineHousing issues any Form 8609 for the Project.

Converting a Carryover Allocation. MaineHousing may convert a carryover allocation to the year in which it is terminated or the following year if there are extenuating circumstances beyond the Applicant’s control. The carryover allocation must be rescinded by the mutual consent of MaineHousing and the Applicant. There can be no change in the design or financing that would render the Application withdrawn under Section 4.I. The Project will be subject to the QAP in effect at the time of the original allocation.

Forward Allocation of Credit. MaineHousing may issue a binding commitment to allocate State Ceiling available in the subsequent year upon determining that the amount of Credit in the current year’s State Ceiling is insufficient

design or financing that would render the Application withdrawn under Section 4.I. The Project will be subject to the QAP in effect at the time of the original allocation.

Forward Allocation of Credit. MaineHousing may issue a binding commitment to allocate State Ceiling available in the subsequent year upon determining that the amount of Credit in the current year’s State Ceiling is insufficient.

SECTION 9: TAX-EXEMPT BOND FINANCED PROJECTS

Projects financed with tax-exempt bond proceeds must satisfy all QAP requirements except

the Maximum Credit Amount limitation in Section 3.C.,

the application limits in Section 4.B.1.,

the application deadlines in Section 4.B.2.,

the selection process described in Sections 4.F.,

the affordability threshold requirement set forth in Section 5.A.,

the requirement of a minimum $75,000 per unit of Rehabilitation Costs for Projects involving the acquisition and rehabilitation of existing housing in Section 5.C.2.,

the scoring criteria in Section 6, and

the Developer Fee limits in Section 7.B.

SECTION 10: MONITORING

Compliance with Applicable Laws. Owners must comply with all local, state and federal laws and regulations, including without limitation:

1. Section 42 of the Code and associated regulations and guidance;

2. UPCS and all other local, state and federal health, safety and building codes applicable to the Project;

3. the Federal Fair Housing Act, Title VIII of the Civil Rights Act of 1968, as amended by the Fair Housing Amendments Act of 1988 (42 U.S.C. §3601 et seq.), Title II of the Americans with Disabilities Act of 1990 (42 U.S.C. §12101 et seq.), and the Maine Human Rights Act (5 M.R.S., Chapter 337, Subchapter IV) and all other applicable federal, state and local fair housing and accessibility requirements, and the regulations, guidance and standards associated with all of the foregoing; and

4

Fair Housing Amendments Act of 1988 (42 U.S.C. §3601 et seq.), Title II of the Americans with Disabilities Act of 1990 (42 U.S.C. §12101 et seq.), and the Maine Human Rights Act (5 M.R.S., Chapter 337, Subchapter IV) and all other applicable federal, state and local fair housing and accessibility requirements, and the regulations, guidance and standards associated with all of the foregoing; and

4. Title VI of the Violence Against Women Reauthorization Act of 2022, 42 USC Chapter 136, Subchapter III, Part M, and all associated regulations and guidance, as may be amended (VAWA).

Recordkeeping and Record Retention. Each Owner must keep on file and available to MaineHousing upon request the following records for each Qualified Building in its LIHTC Project(s) for each year in the Extended Use Period:

The total number of residential rental units including the number of bedrooms and the square footage of each unit;

The number of low-income units;

The rent charged for each unit including any utility allowances;

The number of occupants in each low-income unit;

The number of low-income unit vacancies and information showing when, and to whom, the next available units were rented;

Income certification and third-party documentation verifying the income of each household occupying a Credit Unit at the time of initial occupancy and for each new person added to the household after initial occupancy;

Annual income certifications and third-party documentation verifying the income of each household occupying a Credit Unit in a LIHTC Project are required if not all of the units in the LIHTC Project are Credit Units, or the LIHTC Project is financed or assisted under a state or federal program that requires annual certifications.

For a LIHTC Project with 100% Credit Units that are subject to more than one income limit, annual income certifications are only required for the households occupying the Credit Units subject to the lower income limits

ed if not all of the units in the LIHTC Project are Credit Units, or the LIHTC Project is financed or assisted under a state or federal program that requires annual certifications.

For a LIHTC Project with 100% Credit Units that are subject to more than one income limit, annual income certifications are only required for the households occupying the Credit Units subject to the lower income limits.  The annual certification may be a self-certification, except that third-party documentation verifying the income of the household is required every 6 years from the date the LIHTC Project is Placed in Service and otherwise upon request by MaineHousing.  The self-certification must be

in writing,

include the size of the household and annual household income,

state that the information is complete and accurate,

indicate that third-party source documentation will be provided if requested by the Owner or MaineHousing, and

witnessed.

Annual income certifications are not required for a LIHTC Project with 100% Credit Units subject to the same income limit.

The Eligible Basis and Qualified Basis of each Qualified Building at the end of the first year of the Credit Period;

The character and use of the nonresidential portion of a Qualified Building included in its Eligible Basis;

A determination of the student status of the resident household;

The tenant occupancy policies and procedures and lease. The lease form and content must be acceptable to MaineHousing and comply with all applicable federal, state and local laws (including VAWA); and

All other disclosures to tenants, certifications and other records required by applicable local, state and federal laws

ligible Basis;

A determination of the student status of the resident household;

The tenant occupancy policies and procedures and lease. The lease form and content must be acceptable to MaineHousing and comply with all applicable federal, state and local laws (including VAWA); and

All other disclosures to tenants, certifications and other records required by applicable local, state and federal laws.

Owners must maintain these records throughout the Extended Use Period for at least 6 years after the due date (with extensions) for filing the federal income tax return for that year, except that the records for the Credit Period’s first year must be retained at least 6 years beyond the due date (with extensions) for filing the federal income tax return for the last year of the Compliance Period.

Annual Reports. Each Owner must submit the following to MaineHousing by March 1st of each year throughout the Extended Use Period:

Certification for the prior calendar year that the Owner’s LIHTC Project(s) comply with IRS Treasury Regulation §1.42-5(c)(1) and MaineHousing’s Low Income Housing Tax Credit Program Owner’s Certificate of Continuing Program Compliance attached hereto as Appendix D. A completed and executed IRS Form 8609 for each Qualified Building must be submitted with the first certification; and

Certain information and data about the tenants in Credit Units for the prior calendar year, including household income; monthly rental payments; family composition; use of Section 8 rental assistance and other similar assistance; the race, ethnicity, age and disability status of the members of the households; and all other occupancy information required by MaineHousing.

Review. For new LIHTC Projects, MaineHousing will complete a review of tenant records within two (2) years following the year the last Qualified Building is Placed in Service. MaineHousing will give owners reasonable prior written notice of a review

tance; the race, ethnicity, age and disability status of the members of the households; and all other occupancy information required by MaineHousing.

Review. For new LIHTC Projects, MaineHousing will complete a review of tenant records within two (2) years following the year the last Qualified Building is Placed in Service. MaineHousing will give owners reasonable prior written notice of a review. To the extent required by the Internal Revenue Service (IRS), MaineHousing will inspect low income certifications and tenant records in accordance with IRS Treasury Regulation §1.42 5(c)(2)(iii)(A) through (D) and §1.42 5(d) and will give no more than 15 calendar days prior notice.

Inspections. Every one to three years after a Project is Placed in Service, MaineHousing will inspect LIHTC Projects. For new LIHTC Projects, MaineHousing will inspect Credit Units by the end of the second calendar year following the year the last Qualified Building is Placed in Service. MaineHousing will give reasonable prior written notice. To the extent required by the Internal Revenue Service, MaineHousing will inspect the LIHTC Projects in accordance with IRS Treasury Regulation §1.42 5(c)(2)(iii)(A) through (D) and §1.42 5(d) and will give no more than 15 calendar days prior notice.

Utility Monitoring

All projects funded by this QAP will require monitoring and reporting of all utilities for all units in the manner and form provided by MaineHousing.

Notification of Noncompliance. MaineHousing will notify an Owner in writing of any failure to

submit any complete certifications or information required by MaineHousing when due,

allow MaineHousing to perform any review or inspection required under this Section, or

comply with Section 42 of the Code or any others requirements under this QAP.

The Owner will have a reasonable period of time to correct the noncompliance identified in the notice

ill notify an Owner in writing of any failure to

submit any complete certifications or information required by MaineHousing when due,

allow MaineHousing to perform any review or inspection required under this Section, or

comply with Section 42 of the Code or any others requirements under this QAP.

The Owner will have a reasonable period of time to correct the noncompliance identified in the notice. MaineHousing will file a Form 8823, “Low-Income Housing Credit Agencies Report of Noncompliance” with the Internal Revenue Service within 45 calendar days of the end of the correction period.

SECTION 11: GENERAL

Conflicts. If this rule conflicts with Section 42 of the Code or any other provision of federal or State law, the federal or State law shall control.

Full Discretion. MaineHousing is entitled to the full discretion allowed by law in making all decisions and interpretations under this rule.

Not an Entitlement. This rule establishes a pool of eligible Applicants but does not preclude additional reasonable criteria and does not confer any automatic right or entitlement to Credit on any person or entity eligible hereunder. MaineHousing may reject any and all Applications and may refuse to award any or all of the Credit.

Final Agency Action. The director of MaineHousing, individually or by exercise of the delegation of powers contained in the Act, shall make all decisions and take all action necessary to implement this rule. Such action of the director shall constitute final agency action.

Waiver. Upon a determination of good cause, the director of MaineHousing or the director’s designee may, subject to statutory limitations, waive any provision of this rule. The waiver must be in writing and must be supported by documentation of the pertinent facts and grounds.

Freedom of Access Act. MaineHousing is subject to the Freedom of Access Act, 1 M.R.S

shall constitute final agency action.

Waiver. Upon a determination of good cause, the director of MaineHousing or the director’s designee may, subject to statutory limitations, waive any provision of this rule. The waiver must be in writing and must be supported by documentation of the pertinent facts and grounds.

Freedom of Access Act. MaineHousing is subject to the Freedom of Access Act, 1 M.R.S. §401 et seq., which requires the disclosure of all information provided to MaineHousing that is not specifically excluded, such as confidential information under the Act. MaineHousing shall not be liable for the disclosure of any information that it determines must be disclosed under the Freedom of Access Act.

Liability. Compliance with Section 42 of the Code is the responsibility of the Owner. MaineHousing is in no way responsible for an Owner’s compliance or liable for an Owner’s noncompliance. Any allocation, review or inspection by MaineHousing and any determination made by MaineHousing pursuant to this QAP is for the sole benefit of MaineHousing. No liability or responsibility for Owner compliance with Section 42 of the Code or other applicable requirements and no representation or warranty of a Project’s feasibility or viability, eligibility for Credit, or compliance shall be implied or construed from any such actions and determinations by MaineHousing.

Headings/Context. The headings in this rule are for convenience only and do not define or limit the scope of the provisions of this rule. The use of Section, Subsection or Appendix without a reference to another document or source refers to a section, subsection and Appendix of this rule. All Appendices attached to this Rule are incorporated herein and made a part of this Rule.