99-346 C.M.R. ch. 16, § 7 - PROJECT EVALUATION
A. Amount of
Credit. The amount of Credit allocated will be determined as follows:
1. The calculation of the amount of Credit
will be based on 130% of Eligible Basis. MaineHousing has designated the entire
State 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;
2. 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;
3. The amount of Credit allocated for a
Project will not exceed the least of
a) the
amount the Project is eligible to receive under Section 42 of the
Code,
b) the amount MaineHousing
determines is necessary for financial feasibility and viability throughout the
Credit Period, and
c) the Maximum
Credit Amount;
4. The
Applicant must submit financial and all other required information.
MaineHousing will evaluate the need for Credit based on
a) all sources of financing, including the
terms and conditions,
b) equity
expected to be generated by reason of tax benefits, and
c) the uses of funds, including the
reasonableness of development costs and operating expenditures; and
5. 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).
B.
Developer Fee. Developer Fee will be determined as follows:
1. 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. 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 basis.
C. General Contractor Intermediary
Costs. The general contractor's Intermediary Costs must be:
1. separated from other construction and
rehabilitation costs,
2. with
general conditions and overhead and profit parsed out, and
3. 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
D. Time of Credit Determination. MaineHousing
will determine the amount of Credit at the time of
1. Application, which will be evidenced by
the Notice to Proceed;
2. the
allocation of Credit, including any carryover allocation;
3. the date each Qualified Building is Placed
in Service; and
4. 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.
E. 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.
F. 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.
Notes
State regulations are updated quarterly; we currently have two versions available. Below is a comparison between our most recent version and the prior quarterly release. More comparison features will be added as we have more versions to compare.
No prior version found.