Loading
The Oregon Administrative Rules contain OARs filed through September 15, 2014
 
QUESTIONS ABOUT THE CONTENT OR MEANING OF THIS AGENCY'S RULES?
CLICK HERE TO ACCESS RULES COORDINATOR CONTACT INFORMATION

 

HOUSING AND COMMUNITY SERVICES DEPARTMENT

 

DIVISION 90

LOW-INCOME HOUSING TAX CREDIT PROGRAM

813-090-0005

Purpose and Objectives

The rules of OAR 813, division 090, are promulgated to carry out the provisions and enforce ORS 456.515 through 456.720, and specifically 456.559(1)(f). These rules implement the Low-Income Housing Tax Credit (LIHTC) Program. The Program’s objective is to assist and encourage the development of affordable housing rental units for low-income households through the allocation of housing tax credits as provided by Section 42 of 1986, as amended of the Internal Revenue Code (IRC). The Department has been designated as the housing tax credit allocating agency for the State of Oregon. Additional LIHTC program policies and instructions are outlined in the LIHTC Program Manual dated June 2, 2014 (the “LIHTC Manual” or “Manual,” and the General Policy and Guideline Manual may be accessed online on the Department’s website.

[Publications: Publications referenced are available from the agency.]

Stat. Auth.: ORS 183 & 456.515 - 456.720
Stats. Implemented: ORS 456.559(1)(f)
Hist.: HSG 13-1987(Temp), f. & ef. 9-28-87; HSG 1-1988, f. & cert. ef. 3-8-88; HSG 3-1989(Temp), f. & cert. ef. 6-8-89; HSG 18-1989, f. & cert. ef. 11-3-89; HSG 12-1990(Temp), f. & cert. ef. 5-29-90; HSG 14-1990, f. & cert. ef. 10-26-90; HSG 2-1991(Temp), f. & cert. ef. 8-7-91; HSG 7-1991, f. & cert. ef. 12-19-91; OHCS 10-2013(Temp), f. & cert. ef. 6-21-13 thru 12-18-13; Administrative correction, 2-5-14; OHCS 27-2014(Temp), f. & cert. ef. 6-5-14 thru 12-2-14

813-090-0010

Definitions

All words and terms used in OAR 813, division 90 are as provided in 813-005-0005 and herein. As used in these rules:

(1) “Applicant” means a person or entity that applies for an allocation of Housing Credit from the Department by completing an application provided by the Department.

(2) “Carryover Allocation” means an allocation of Housing Credit made to a proposed Project owner by the Department for a proposed Project which is not yet eligible to receive an allocation Form 8609 and which is over ten percent completed as of the end of the calendar year in which the allocation is made.

(3) “Credit Authority” means the dollar amount of Housing Credit available for allocation by the Department for any calendar year and may include estimates of future amounts.

(4) “Housing Credit” means the low-income housing tax credit available to a Project pursuant to IRC Section 42. The amount of low income housing tax credit available for allocation to a Project is that amount which the Department determines is necessary to make the Project financially feasible but in no instance may it be greater than the applicable percentage of the qualified basis of each qualified low income building.

(5) “IRC” means the Internal Revenue Code of 1986, as amended.

(6) “Oregon agency” and “Department” mean the Oregon state agency of the State of Oregon.

(7) “Project” means a qualified low income housing project as defined in IRC Section 42(g). A Project may include one or more buildings and any associated common area and may be located on scattered sites, if each of the dwelling units within each building is rent-restricted as required in IRC Section 42(g).

(8) “NOFA” means Notice of Funding Availability.

(9) “Reservation and Extended Use Agreement” is a contract between the Department and the proposed Project owner whereby the proposed Project owner agrees, among other things, to provide and maintain the Project and to guarantee its compliance with the requirements of IRC Section 42 and the Department by executing and recording the Declaration of Land Use Restrictive Covenants on the Project in return for an allocation of Housing Credit in accordance with IRC Section 42(h)(6). It will also include by reference the Carryover Allocation Agreement.

Stat. Auth.: ORS 183 & 456.515 - 456.720
Stats. Implemented: ORS 456.559(1)(f)
Hist.: HSG 13-1987(Temp), f. & ef. 9-28-87; HSG 1-1988, f. & cert. ef. 3-8-88; HSG 3-1989(Temp), f. & cert. ef. 6-8-89; HSG 18-1989, f. & cert. ef. 11-3-89; HSG 12-1990(Temp), f. & cert. ef. 5-29-90; HSG 14-1990, f. & cert. ef. 10-26-90; HSG 2-1991(Temp), f. & cert. ef. 8-7-91; HSG 2-1991(Temp), f. & cert. ef. 8-7-91; HSG 7-1991, f. & cert. ef. 12-19-91; OHCS 10-2013(Temp), f. & cert. ef. 6-21-13 thru 12-18-13; Administrative correction, 2-5-14; OHCS 27-2014(Temp), f. & cert. ef. 6-5-14 thru 12-2-14

813-090-0015

Allocation of Credit Authority

(1) The Department may, to the extent of its Credit Authority, allocate Housing Credits pursuant to a qualified allocation plan of the Department approved by Executive Order.

(2) The Department shall allocate the Housing Credit in compliance with the requirements of IRC Section 42, applicable regulations and revenue procedures enacted or adopted thereunder, ORS 456.559(1)(f) and the rules of this division. Applications will be solicited during specified periods within the Department’s Notice of Funding Availability (NOFA). The Department may also select from a pool of qualified applicants, or such other process the Department deems appropriate.

(3) The Department shall maintain a record of allocations and the balance of Credit Authority remaining for each calendar year. The records shall account separately for Credit Authority set-aside under OAR 813-090-0067 and 813-090-0027.

Stat. Auth.: ORS 456.555
Stats. Implemented: ORS 456.508, 456.510, 456.513, 456.559, 456.605, 456.626, 456.722
Hist.: HSG 13-1987(Temp), f. & ef. 9-28-87; HSG 1-1988, f. & cert. ef. 3-8-88; HSG 3-1989(Temp), f. & cert. ef. 6-8-89; HSG 18-1989, f. & cert. ef. 11-3-89; HSG 12-1990(Temp), f. & cert. ef. 5-29-90; HSG 14-1990, f. & cert. ef. 10-26-90; HSG 2-1991(Temp), f. & cert. ef. 8-7-91; HSG 7-1991, f. & cert. ef. 12-19-91; OHCS 10-2013(Temp), f. & cert. ef. 6-21-13 thru 12-18-13; Administrative correction, 2-5-14; OHCS 27-2014(Temp), f. & cert. ef. 6-5-14 thru 12-2-14

813-090-0025 [Renumbered to 813-090-0067]

813-090-0027

Farmers Home Administration 515 Program Set Aside

(1) Ten percent of the Credit Authority for any calendar year may be set aside for Projects financed through the Farmers Home Administration (FmHA) 515 Program.

(2)(a) To qualify for Housing Credit set aside under OAR 813-090-0025(1), Applicants shall submit documentation from FmHA substantiating they are approved for financing under the FmHA 515 Program. A completed Form AD622, or its equivalent will be acceptable for this purpose if the Form AD622 indicates that the project has been determined to be eligible for funding in competition with similar applications and the Applicant has been invited to file a formal application with FmHA in time to be funded by November 1st of the year from which Housing Credit will be allocated. The Department may revoke an offer of Housing Credit allocation to an FmHA 515 Project or terminate a Reservation and Extended Use Agreement under OAR 813-090-0060 if FmHA funding is not committed to by November 1st of the Housing Credit allocation year;

(b) If the full set aside is not allocated through an application process, other rural housing (as defined by FmHA rules) will have first priority for the balance of the set aside with any unused tax credit added to non-rural projects.

Stat. Auth.: ORS 183 & 456.515 - 456.720
Stats. Implemented: ORS 456.559(1)(f)
Hist.: HSG 13-1987(Temp), f. & ef. 9-28-87; HSG 1-1988, f. & cert. ef. 3-8-88; HSG 3-1989(Temp), f. & cert. ef. 6-8-89; HSG 18-1989, f. & cert. ef. 11-3-89; HSG 12-1990(Temp), f. & cert. ef. 5-29-90; HSG 14-1990, f. & cert. ef. 10-26-90; HSG 2-1991(Temp), f. & cert. ef. 8-7-91; HSG 7-1991, f. & cert. ef. 12-19-91; Suspended by OHCS 10-2013(Temp), f. & cert. ef. 6-21-13 thru 12-18-13; Suspended by OHCS 27-2014(Temp), f. & cert. ef. 6-5-14 thru 12-2-14

813-090-0029 [Renumbered to 813-090-0039]

813-090-0030 [Renumbered to 813-090-0037]

813-090-0031

Application Requests and Charges

(1) The Department may solicit applications for an allocation of Housing Credit from interested parties when such credit is available.

(2) The Department may require a non-refundable application charge from any applicant requesting Low Income Housing Tax Credits through the Consolidated Funding Cycle or otherwise.

(3) The Department may require a supplemental application charge from applicants requesting additional resources for projects that have already been funded by the Department.

(4) The Department may require a transfer application charge from owners of projects that receive grants or tax credits through the Department, who request the Department's approval of a change in project ownership. The Department may assess a transfer review charge to project owners and transferees who effect a change in project ownership without prior written Department approval.

(5) The Department may require a reservation charge from any applicant prior to the execution of a Reservation and Extended Use Agreement.

(6) The Department may assess additional late charges to an applicant if its LIHTC final application is received by the Department after established deadlines. The Department also may assess a supplemental charge to an applicant if the Department determines that a re-evaluation of the applicant's final application is necessary or warranted.

(7) If the Housing Credits awarded to a project cannot be used by the end of the calendar year of the tax credit allocation and the owner has expended or incurred 10% of project costs, an application for a Carryover Allocation of Housing Credits must be made by the deadline established by the Department for the credit year or the credits will be lost. The Department may require a supplemental application charge from an applicant who submits an LIHTC carryover application after the deadlines established by the Department. The Department also may assess a supplemental charge to an applicant if the Department determines that a re-evaluation of the applicant's carryover application is necessary or warranted.

(8) The Carryover requirements do not apply to LIHTC projects using tax-exempt bond financing.

(9) The applicant shall submit an Application for final allocation of Housing Credits when the Project is placed in service. The Department shall prescribe the period for submitting a final Application. The Department may assess a late charge for applicants that submit Applications after the prescribed deadline. The Department also may assess a supplemental charge to an applicant if the Department determines that a re-evaluation of the applicant's final application is necessary or warranted.

(10) The Department may charge the Project owner reasonable charges for the Department's costs of monitoring the project owner's compliance with restrictions established by the Department and IRC Section 42 or applicable law.

(11) The Department shall evaluate completed applications based on a ranking system consistent with IRC Section 42(m)(l), established by the Department and set forth in the Department's qualified allocation plan.

[Publications: Publications referenced are available from the agency.]

Stat. Auth.: ORS 456.515 - 456.720
Stats. Implemented: ORS 456.559(1)(f)
Hist. HSG 12-1990(Temp), f. & cert. ef. 5-29-90; HSG 14-1990, f. & cert. ef. 10-26-90; HSG 2-1991(Temp), f. & cert. ef. 8-7-91; HSG 7-1991, f. & cert. ef. 12-19-91; OHCS 9-2006(Temp), f. & cert. ef. 8-4-06 thru 1-30-07; OHCS 8-2007, f. & cert. ef. 1-11-07; Suspended by OHCS 10-2013(Temp), f. & cert. ef. 6-21-13 thru 12-18-13; OHCS 27-2014(Temp), f. & cert. ef. 6-5-14 thru 12-2-14

813-090-0035

Applications for Low-Income Housing Tax Credits

(1) Applicants must submit an application form along with any applicable charges as given in Section 813-090-0031, to qualify for an allocation of Low-Income Housing Credits. The application required by the Department may request, among other information, the following:

(a) The amount of Housing Credit requested;

(b) Building location: state, county, town, street address and legal description;

(c) An initial statement based on waiting list information from the local public housing authority indicating whether or not there is a need for the proposed project;

(d) The qualified basis as defined in IRC Section 42, including the amount of substantial rehabilitation, if any;

(e) What elections under Section 42 the proposed Project owner will be making or has made to qualify for an allocation of Housing Credit, and when the housing units will be/were placed in service;

(f) Complete financial information about the proposed Project showing all sources and uses of funds;

(g) Operating proforma statement on a cash flow basis showing net operating income before debt service;

(h) Evidence of a commitment for financing, federal loan insurance, or other major source of funds;

(i) A detailed summary of the proceeds or receipts expected to be generated by reason of tax benefits; and

(j) Other financial information regarding grants, subsidies, or tax-exempt financing for the proposed Project.

(2) Before the Department makes an offer of a Housing Credit allocation to a proposed Project owner it shall:

(a) Review all applications;

(b) Determine the amount of Housing Credit each proposed Project needs to receive to be financially feasible;

(c) Rank the applications pursuant to the Department’s qualified allocation plan and IRC Section 42;

(d) Notify the chief executive officer (or the equivalent) of the local jurisdiction with in which the proposed Project is located and provide such individual a reasonable opportunity to comment on the proposed Project to the Department. When a proposed Project is located outside an incorporated community, the county commissioners for the county of jurisdiction shall be contacted; and

(e) Notify Applicants whether or not they will receive an offer to execute a Reservation and Extended Use Agreement with the Department.

Stat. Auth.: ORS 456.555
Stats. Implemented: ORS 456.508, 456.510, 456.513, 456.559, 456.605, 456.625, 456.722
Hist.: HSG 13-1987(Temp), f. & ef. 9-28-87; HSG 1-1988, f. & cert. ef. 3-8-88; HSG 3-1989(Temp), f. & cert. ef. 6-8-89; HSG 18-1989, f. & cert. ef. 11-3-89; HSG 12-1990(Temp), f. & cert. ef. 5-29-90; HSG 14-1990, f. & cert. ef. 10-26-90; HSG 2-1991(Temp), f. & cert. ef. 8-7-91; HSG 7-1991, f. & cert. ef. 12-19-91; OHCS 9-2006(Temp), f. & cert. ef. 8-4-06 thru 1-30-07; OHCS 8-2007, f. & cert. ef. 1-11-07; OHCS 10-2013(Temp), f. & cert. ef. 6-21-13 thru 12-18-13; Administrative correction, 2-5-14

813-090-0036

Procedures for Allocation of Low-Income Housing Tax Credit (the “Carryover Allocation Agreement”

(1) Applicants selected for an offer under OAR 813-090-0035 must execute with the Department a Reservation and Extended Use Agreement in a form satisfactory to the Department. The Reservation and Extended Use Agreement will include, among other things, a provision for financial evaluation of the Project based on cost certification and will incorporate a Declaration of Land Use Restrictive Covenants to be executed and recorded prior to the Department completing a Form 8609 and delivering a copy thereof to the Applicant.

(2) If the Housing Credit cannot be used in the year of allocation but the proposed Project is over 10 percent completed, a Carryover Allocation may be made. If a Carryover Allocation has been made, the owner shall submit the application for final allocation of Housing Credit when the Project is placed in service. The Department shall limit at the time of the extension of a Carryover Allocation, the maximum credit which the proposed project may receive.

(3) Upon receipt of a certified copy of the recorded Declaration of Land Use Restrictive Covenants in a form satisfactory to the Department, the Department shall complete and issue Part I of Internal Revenue Service Form 8609 to confirm final allocation of Housing Credits.

(4) The Project owner shall be responsible for filing the required IRS Form with his or her tax return.

(5) An allocation may not be rescinded or reduced by the Department except as provided under OAR 813-090-0080. Proposed Project owners may return unneeded Housing Credit by completing and filing with the Department, forms supplied by the Department.

Stat. Auth.: ORS 456.515 - 456.720
Stats. Implemented: ORS 456.559(1)(f)
Hist.: HSG 12-1990(Temp), f. & cert. ef. 5-29-90; HSG 14-1990, f. & cert. ef. 10-26-90; HSG 2-1991(Temp), f. & cert. ef. 8-7-91; HSG 7-1991, f. & cert. ef. 12-19-91; OHCS 9-2006(Temp), f. & cert. ef. 8-4-06 thru 1-30-07; OHCS 8-2007, f. & cert. ef. 1-11-07; Suspended by OHCS 10-2013(Temp), f. & cert. ef. 6-21-13 thru 12-18-13; OHCS 27-2014(Temp), f. & cert. ef. 6-5-14 thru 12-2-14

813-090-0037

Qualified Allocation Plan and Project Evaluation

(1) The Department shall develop and maintain a Capitalized Qualified Allocation Plan for the allocation of Housing Credit.

(2) The Department may periodically solicit applications or select projects from a pool of qualified applications for the allocation of Housing Credit pursuant to the Department's Capitalized Qualified Allocation Plan (“QAP”), Program Manual and General Policy and Guideline Manual. Applications will be evaluated consistent with IRC Section 42, ORS 456.559(1)(f), the rules of this division and procedures consistent with the Department goals to provide long term affordable housing.

Stat. Auth.: ORS 456.515 - 456.720
Stats. Implemented: ORS 456.559(1)(f)
Hist. HSG 12-1990(Temp), f. & cert. ef. 5-29-90; HSG 14-1990, f. & cert. ef. 10-26-90; HSG 2-1991(Temp), f. & cert. ef. 8-7-91; HSG 7-1991, f. & cert. ef. 12-19-91; Renumbered from 813-090-0030 by OHCS 5-2013, f. & cert. ef. 6-21-13; OHCS 10-2013(Temp), f. & cert. ef. 6-21-13 thru 12-18-13; Administrative correction, 2-5-14; OHCS 27-2014(Temp), f. & cert. ef. 6-5-14 thru 12-2-14

813-090-0039

Reservation and Extended Use Agreement Low-Income Commitment

(1) No allocation shall be made by the Department to an Applicant until or unless the Department and the Applicant enter into a Reservation and Extended Use Agreement (“REUA”). The Reservation and Extended Use Agreement shall specify, among other things, a minimum applicable unit fraction as defined by IRC Section 42(c)(1)(B) and the rent formula to be maintained for the Project to continue to qualify for Housing Credit.

(2) An executed Reservation and Extended Use Agreement shall be enforceable in any State court by any individual who qualified for occupancy by virtue of the income limitation set for

such buildings; shall be binding on all successors of the Applicant; and the Declaration of Land Use Restrictive Covenants incorporated within the Reservation and Extended Use Agreement shall be recorded pursuant to State law as a restrictive covenant.

(3) The Housing Credit allocation may not exceed the amount necessary for the financial feasibility of those units of the Project represented by the applicable fraction at the restricted rents specified in the Reservation and Extended Use Agreement.

(4) The Reservation and Extended Use Agreement shall include a commitment to meet the applicable fraction and restricted rent requirements for 15 years or more beyond the initial 15 year compliance period and may postpone for a specific time the project owner's rights under IRC Section 42(h)(6) to terminate the commitment after the initial 15 year compliance period.

Stat. Auth.: ORS 456.515 - 456.720
Stats. Implemented: ORS 456.559(1)(f)
Hist.: HSG 14-1990, f. & cert. ef. 10-26-90; HSG 2-1991(Temp), f. & cert. ef. 8-7-91; HSG 7-1991, f. & cert. ef. 12-19-91; Renumbered from 813-090-0029, OHCS 5-2013, f. & cert. ef. 6-21-13; OHCS 10-2013(Temp), f. & cert. ef. 6-21-13 thru 12-18-13; Administrative correction, 2-5-14; OHCS 27-2014(Temp), f. & cert. ef. 6-5-14 thru 12-2-14

813-090-0040

Qualified Basis Limited by Application

The qualified basis established for the Project at the time the Housing Credit is allocated may not be increased without the Applicant submitting another application for an additional Housing Credit allocation in accordance with OAR 813-090-0031.

Stat. Auth.: ORS 456.555
Stats. Implemented: ORS 456.508, 456.510, 456.513, 456.559, 456.605, 456.625, 456.722
Hist.: HSG 13-1987(Temp), f. & ef. 9-28-87; HSG 1-1988, f. & cert. ef. 3-8-88; HSG 3-1989(Temp), f. & cert. ef. 6-8-89; HSG 18-1989, f. & cert. ef. 11-3-89; HSG 12-1990(Temp), f. & cert. ef. 5-29-90; HSG 14-1990, f. & cert. ef. 10-26-90; HSG 2-1991(Temp), f. & cert. ef. 8-7-91; HSG 7-1991, f. & cert. ef. 12-19-91; OHCS 10-2013(Temp), f. & cert. ef. 6-21-13 thru 12-18-13; Administrative correction, 2-5-14

813-090-0060 [Renumbered to 813-090-0080]

813-090-0065

Representations

The Department shall rely on representations of the Applicant, including all agents and parties of interest, in reviewing applications and evaluating the amount of Housing Credit needed and whether a proposed Project qualifies for a Housing Credit allocation, and shall not validate the financial feasibility of a proposed or established Project, credit worthiness of the Applicant, or tax consequences of the Housing Credit for the Project, the Applicant or any other interested party.

Stat. Auth.: ORS 456.515 - 456.720
Stats. Implemented: ORS 456.559(1)(f)
Hist.: HSG 12-1990(Temp), f. & cert. ef. 5-29-90; HSG 14-1990, f. & cert. ef. 10-26-90; HSG 2-1991(Temp), f. & cert. ef. 8-7-91; HSG 7-1991, f. & cert. ef. 12-19-91; Suspended by OHCS 10-2013(Temp), f. & cert. ef. 6-21-13 thru 12-18-13

813-090-0067

Non-Profit Set Aside

Ten percent of the Credit Authority for any calendar year shall be reserved for allocations to Projects involving a qualified non-profit low-income housing organization.

Stat. Auth.: ORS 183 & ORS 456.515 - 456.720
Stats. Implemented: ORS 456.559(1)(f)
Hist.: HSG 13-1987(Temp), f. & ef. 9-28-87; HSG 1-1988, f. & cert. ef. 3-8-88; HSG 3-1989(Temp), f. & cert. ef. 6-8-89; HSG 18-1989, f. & cert. ef. 11-3-89; HSG 12-1990(Temp), f. & cert. ef. 5-29-90; HSG 14-1990, f. & cert. ef. 10-26-90; HSG 2-1991(Temp), f. & cert. ef. 8-7-91; HSG 7-1991, f. & cert. ef. 12-19-91; Renumbered from 813-090-0025, OHCS 5-2013, f. & cert. ef. 6-21-13; OHCS 10-2013(Temp), f. & cert. ef. 6-21-13 thru 12-18-13; Administrative correction, 2-5-14

813-090-0070 [Renumbered to 813-090-0095]

813-090-0080

Revocation or Reduction of Housing Credit

(1) The Department may refuse to make an offer, may revoke an offer of a Housing Credit allocation, or may terminate a Reservation and Extended Use Agreement, if the Department determines that:

(a) The proposed Project owner will not obtain a construction loan or building permit, or close its equity agreement for the proposed Project in a timely manner;

(b) The proposed Project will not be placed in service by the date mutually agreed upon;

(c) The proposed Project financing is not committed as indicated; or

(d) The Applicant has supplied misleading information.

(2) The Department may reduce the allocation amount identified in the Reservation and Extended Use Agreement prior to the issuance of a copy of a Carryover Allocation or Form 8609 to the project owner if the Department determines that the project requires a lesser amount of Housing Credit to be financially feasible, as required in IRC Section 42(m).

(3) When the Department has issued a Carryover Allocation, the Department may reduce the allocation amount identified in the Carryover Allocation prior to the delivery of a copy of a Form 8609 to the Project owner if the Department determines that the project requires a lesser amount of Housing Credit than previously determined to be financially feasible.

(4) The Department may revoke a Carryover Allocation if the Department determines that at least 10% of the total project cost will not be expended by the end of the calendar year in which the Carryover Allocation is made, or that the Project will not be placed in service within two years following the calendar year in which a Carryover Allocation is made or by the dates mutually agreed upon.

Stat. Auth.: ORS 183 & 456.515 - 456.720
Stats. Implemented: ORS 456.559(1)(f)
Hist.: HSG 13-1987(Temp), f. & ef. 9-28-87; HSG 1-1988, f. & cert. ef. 3-8-88; HSG 3-1989(Temp), f. & cert. ef. 6-8-89; HSG 18-1989, f. & cert. ef. 11-3-89; HSG 12-1990(Temp), f. & cert. ef. 5-29-90; HSG 14-1990, f. & cert. ef. 10-26-90; HSG 2-1991(Temp), f. & cert. ef. 8-7-91; HSG 7-1991, f. & cert. ef. 12-19-91; Renumbered from 813-090-0060, OHCS 5-2013, f. & cert. ef. 6-21-13; OHCS 10-2013(Temp), f. & cert. ef. 6-21-13 thru 12-18-13; Administrative correction, 2-5-14; OHCS 27-2014(Temp), f. & cert. ef. 6-5-14 thru 12-2-14

813-090-0089

Transfer of Owner, Tax Credit or Project Ownership

(1) The sponsor of a project to which low-income housing tax credits are allocated under the Low-Income Housing Tax Credit Program and an owner of such project may not transfer or allow any transfer of any interest in itself, the tax credits or the project or otherwise encumber the project, or any portion or interest therein, unless the department first approves the transfer or encumbrance in writing. Any such transfer or encumbrance is subject to payment to the department by the sponsor or owner of a transfer or encumbrance charge as required by the department. The owner shall notify in writing and obtain the agreement of any buyer or successor or other person acquiring the project or any interest therein that such acquisition is subject to declaration requirements. If the sponsor or owner effects or allows a transfer or encumbrance without prior written approval by the department, the transfer or encumbrance is voidable and remains subject to the approval or disapproval of the department and the sponsor or owner and transferees, jointly and severally, are subject to a transfer or encumbrance review charge by the department. The owner agrees that the department may, in addition to the exercise of other remedies, void any sale, transfer, or exchange of the project found in noncompliance.

(2) The department may condition its approval upon such terms and conditions as it, in its sole discretion, may require. Factors the department may consider in determining whether to give approval to a transfer or encumbrance include but are not limited to:

(a) The financial investment of the department in the project;

(b) Preservation of existing housing;

(c) The proposed transferee’s ability to maintain and manage the project property for the needs of the residents, the integrity of the housing and as security for any financing;

(d) The effect of the transfer or encumbrance upon the financial integrity of the project, the tax credits, the repayment of project financing, use of the project for its intended purposes, and continuity of the program; and

(e) Continued compliance with applicable program requirements including, but not limited to terms and conditions of applicable funding documents, resultant restrictive covenants and equitable servitudes, and state and federal laws, rules and regulations.

Stat. Auth.: ORS 456.555
Stats. Implemented: ORS 456.508, 456.510, 456.513, 456.559, 456.605, 456.625, 456.722
Hist.: OHCS 26-2014(Temp), f. & cert. ef. 6-2-14 thru 11-29-14; Suspended by OHCS 30-2014(Temp), f. 6-5-14 thru 11-29-14

813-090-0095

Monitoring and Compliance

(1) The department will notify the Internal Revenue Service in writing when the department determines that a project is not complying with applicable provisions of Internal Revenue Code Section 42. The department is not liable to the project or project owner for any adverse consequences resulting from the department’s notification.

(2) The department will send to the project owner a copy of the department’s notification of non-compliance to the Internal Revenue Service regarding the project.

(3) A project owner shall submit such information and documents, including but not limited to an annual report to the department when the department so requires for monitoring compliance.

(4) The department may inspect the project and inspect and copy project records as it deems appropriate. The project owner will fully cooperate in such inspections. File reviews may be completed electronically.

(5) The reservation and extended use agreement (REUA) and the declaration of land use restrictive covenants under OAR 813-090-0039, and all related documents, are subject to enforcement by the department or its designee as they may determine appropriate, including but not limited to any failure by the project owner to timely satisfy any requirement of such documents or applicable law.

(6) The declaration of land use restrictive covenants is a contract that is enforceable according to its terms by one or more tenants as third-party beneficiaries of the declaration and the agreement of which the declaration is part.

(7) The department or one or more tenants or beneficiaries may recover legal costs, including legal charges, court and appeal costs when the legal costs are incurred because of failure by the project owner to satisfy any of the requirements of the declaration, reservation and extended use agreement, other documents or applicable law. The department also may recover reasonable legal fees as provided in relevant documents.

(8) The department may charge the project owner for reasonable costs of administration including, but not limited to, monitoring and enforcing the project owner’s compliance with program requirements established by the department and Internal Revenue Code Section 42 or other applicable law.

(9) The department reserves the right, consistent with applicable law, to waive, modify and release REUA, declaration and other funding document terms and conditions including, but not limited to restrictive covenants and equitable servitudes related thereto. Any waiver, modification, or release must be in writing and signed by an authorized department representative.

Stat. Auth.: ORS 456.515 - 456.720
Stats. Implemented: ORS 456.559(1)(f)
Hist.: HSG 12-1990(Temp), f. & cert. ef. 5-29-90; HSG 14-1990, f. & cert. ef. 10-26-90; HSG 2-1991(Temp), f. & cert. ef. 8-7-91; HSG 7-1991, f. & cert. ef. 12-19-91; OHCS 9-2006(Temp), f. & cert. ef. 8-4-06 thru 1-30-07; OHCS 8-2007, f. & cert. ef. 1-11-07; Renumbered from 813-090-0095 by OHCS 5-2013, f. & cert. ef. 6-21-13; OHCS 10-2013(Temp), f. & cert. ef. 6-21-13 thru 12-18-13; Administrative correction, 2-5-14; OHCS 26-2014(Temp), f. & cert. ef. 6-2-14 thru 11-29-14; Suspended by OHCS 30-2014(Temp), f. 6-5-14 thru 11-29-14

813-090-0110

Remedies

(1) If the Department determines that there has been any material failure or default with respect to any term, covenant or condition of the applicable solicitation or funding documents, applicable rules, directives, other program requirements, or otherwise, it (or as applicable, the IRS) may exercise any remedy available under OAR chapter 813 (including remedies available in the 9 % LIHTC Program Manual and General Policy and Guideline Manual), relevant solicitation or funding documents, or applicable law. Remedies include, but are not limited to corrective orders or directives, recapture of LIHTC, recovery for damages, specific performance, injunctive relief, declaratory actions, appointment of a receiver for the project, foreclosure of lien interests, debarment from other Department funding, and other remedies available at law.

(2) The remedies set forth in this section are cumulative and not exclusive and are in addition to any other rights and remedies provided in this Division, other Department rules, the solicitation and funding documents, or otherwise available at law or otherwise. The Department may exercise any or all remedies available to it, and in such manner as it, in its sole discretion, determines appropriate.

Stat. Auth.: ORS 456.555
Stats. Implemented: ORS 456.508, 456.510, 456.513, 456.559, 456.605, 456.625, 456.722
Hist.: OHCS 27-2014(Temp), f. & cert. ef. 6-5-14 thru 12-2-14

The official copy of an Oregon Administrative Rule is contained in the Administrative Order filed at the Archives Division, 800 Summer St. NE, Salem, Oregon 97310. Any discrepancies with the published version are satisfied in favor of the Administrative Order. The Oregon Administrative Rules and the Oregon Bulletin are copyrighted by the Oregon Secretary of State. Terms and Conditions of Use

Oregon Secretary of State • 136 State Capitol • Salem, OR 97310-0722
Phone: (503) 986-1523 • Fax: (503) 986-1616 • oregon.sos@state.or.us

© 2013 State of Oregon All Rights Reserved​