Virtually All HFAs Now Providing Incentives for Preservation Projects

According to a National Housing Trust Survey of state qualified allocation plans (QAPs), almost all State Agencies are now awarding points, providing set-asides, and seeking preferences for preservation in the development of tax credit projects.

16 agencies have included preservation set-asides in their 2011 QAPs, with Florida setting aside a full 50 percent of its credits for preservation projects. Other state set- asides range from ten to forty percent.

26 States and the District of Columbia and New York City provide competitive scoring points for preservation and nine other states provide points for rehabilitation, but don’t specify preservation.

Agencies in Indiana, Michigan, Missouri, and Oregon have made preservation projects eligible for the 30 percent increase in eligible basis.

Developers seeking credits in 2011 should carefully review their State’s QAP for requirements relative to preservation. New construction deals in States with a preference for preservation could be at a competitive disadvantage.