Low-Income Housing Tax Credits

Overview

The Federal Tax Reform Act of 1986 created Low-Income Housing Tax Credits for qualified residential properties to encourage the production of affordable low-income rental housing. The program offers a reduction in the tax liability to owners and investors of qualified affordable rental housing projects relating to the acquisition, construction or rehabilitation of low-income rental housing units.

The Housing and Redevelopment Authority of the City of Saint Paul (“HRA”), through its role in the Minneapolis/Saint Paul Housing Finance Board, is a Suballocator of 9% and 4% Housing Tax Credits (HTCs). The HRA solicits applications for 9% HTCs through an annual Notice of Funding Availability. The HRA allocates 4% HTCs in conjunction with an issuance of Housing Revenue Bonds. HTC program materials and forms can be found at the links below.

2025 Low Income Housing Tax Credits

The Housing and Redevelopment Authority (“HRA”) of the City of Saint Paul is soliciting applications for reservation and allocation of Year 2025 9% Housing Tax Credits (HTCs) for eligible rental housing developments located within the boundaries of the City of Saint Paul until Monday, July 8, 2024 at 4 p.m. The HRA is anticipating an allocation of $984,219 in Year 2025 9% HTCs.

NOTE: Current HOUSING TAX CREDIT PROGRAM COMPLIANCE MANUAL as well as other relevant tax credit compliance information is available on the Affordable Housing Connections website.

Application Materials

Applicants should review the 2024-2025 Housing Tax Credit (HTC) Procedural Manual, Qualified Allocation Plan and the requirements for all exhibits before submitting an application. The HTC Manual, Qualified Allocation Plan and additional materials are as follows:

• Minnesota Housing Multifamily Workbook
• Housing Tax Credits Section 42 Certification Form
• Multifamily Consolidated Request for Proposals (RFP) and Housing Tax Credit (HTC) General Certification Form
• 2024-2025 Housing Tax Credit Procedural Manual
• 2024-2025 Qualified Allocation Plan (Exhibit A)
• Form of Opinion of Counsel – Application (Exhibit B)
• Self-Scoring Worksheet 9% (Exhibit E)
• Self-Scoring Worksheet 4% (Exhibit F)
• Agreement to Utilize Public Housing Waiting List (HTC-11) (Exhibit J)
• Previous Participation (Exhibit K)
• Project Team Resumes (Exhibit L)
• Rent and Income Limits
• Maintenance and Operating Expense Review and Underwriting Certification (HTC-29) (Exhibit W)
• Affirmative Fair Housing Marketing Plan (HUD-935.2A) (Exhibit Y)
• Equal Employment Opportunity Policy Statement (Exhibit Z)
• Multifamily - Intended Methods Worksheet: MN Overlay to Green Communities (Exhibit AA)
• MN Housing’s Average Income Rent and Income Grid (Exhibit AB)
• Minnesota Housing’s Average Income Certification Form (Exhibit AC)
• Tenant Selection Plan (Exhibit AD)
• Declaration of Land Use Restrictive Covenants (Exhibit Q) Note: This is an example. The 2022-2023 LURA may be updated at a later date.
• Saint Paul LURA (Exhibit D)
• Saint Paul Sustainable Building Ordinance
  • All new construction projects receiving more than $200,000 in public investment must comply with Saint Paul Sustainable Building Ordinance.
• PED/HRA Sustainability Initiative
  • Projects that receive $200,000 or less must comply with the PED/HRA Sustainability Initiative.
• Land Use Chapter of the Saint Paul 2040 Comprehensive Plan

Carryover, Placed in Service and Additional HTC Exhibits

• Opinion of Counsel Regarding Carryover Application (Exhibit D)
• Opinion of Counsel – Placed in Service (Exhibit X)
• Notice to Transfer Interest or Change Owner’s Name Form (HTC-27) (Exhibit M)
• Final Cost Certification (HTC-9) (Exhibit S)
• Final Cost Certification Statement (HTC-9) (Exhibit S)
• Application for Issuance of IRS 8609 Owner Certification (HTC-3) (Exhibit T)
• 8609 Application (HTC-3A) (Exhibit T)
• Statement of Election of Gross Rent Floor Bond-Financed (HTC-34) (Exhibit V)
• Statement of Election of Gross Rent Floor Competitive Cap (HTC-26) (Exhibit V)
• VAWA Certification (Exhibit AE)
• Building Map (HTC-28) (Exhibit R)
• Election of Applicable Percentages
• Section 42 Internal Revenue Code (Exhibit I)
• 2022-2023 Additional LIHTC Exhibits

Application Fees

• Initial application fee: An application fee made payable to Saint Paul Housing and Redevelopment Authority must be submitted with the application. The application fees are non-refundable.
   
  • For-profit developers: Applications submitted by for-profit developers shall be subject to an application fee of $700 or $30 times the number of units of the proposed developments with a maximum of $2,000, whichever amount is greater.
     
  • Non-profit developers: The fee for applications submitted by non-profit developers shall be equal to $700.
     
• Allocation upon receipt of award: At such time, a project is awarded an allocation of tax credits, the application will be required to submit payment of a non-refundable Allocation Fee made payable to the Saint Paul Housing and Redevelopment Authority in an amount equal to 1.5% of the tax credit allocation award. Allocation fee will also be required for a Carryover Agreement, if needed, and the issuance of the IRS Form 8609.
   
• Other fees: The Minnesota Housing Finance Agency (MHFA) now requires that a Suballocator who fails to meet deadlines established by MHFA for the submission of required documents relating to allocation or commitments, carryover, issuance, and allocation reporting shall pay the fees established in the MHFA Qualified Allocation Plan. Consequently, Saint Paul HRA, as a Suballocator, will also require that developers be responsible for meeting the deadlines related to its project and for payment of any related late fees.

Application Submission Requirements

Please submit one (1) electronic (flash drive) copy to:

Vicki Lee
Department of Planning and Economic Development
25 West Fourth Street, Suite 1100
Saint Paul, MN 55102

All applications, including those mailed, must be received no later than 4 p.m. on Monday, July 8, 2024.

NO LATE PROPOSALS WILL BE ACCEPTED. THE SAINT PAUL HOUSING AND REDEVELOPMENT AUTHORITY RESERVES THE RIGHT TO REJECT ANY OR ALL PROPOSALS.

Qualified 501(c)(3) and 501(c)(4) non-profit organizations are eligible to apply for low-income housing tax credits with HRA and/or with the Minnesota Housing Finance Agency (MHFA) through the Metro Twin Cities Area non-profit set-aside pool. To make application for tax credits with MHFA, please call (651) 297-3294.

Upon request, all proposed applications and guideline materials can also be picked up at the Saint Paul Planning and Economic Development Department, 1100 City Hall Annex, 25 West Fourth Street, Saint Paul, MN 55102.

Please note that, though it is not anticipated, these materials are subject to change without notice.

For more information, contact Vicki Lee at (651) 266-6591 or vicki.lee@stpaul.gov.