Shelter Plus Care: Use of Tax Credit Properties in the S+C Program Libby Tyre, Shelter Plus Care Coordinator September 2015

Use of Tax Credit Properties in the S+C Program  Shelter Plus Care can be used in a Low Income Housing Tax Credit (LIHTC) property.  HOWEVER…

Use of Tax Credit Properties in the S+C Program  Most Shelter Plus Care in Georgia is “Sponsor-based Rental Assistance”  Sponsor-based Rental Assistance (SRA) component Under the SRA component, an applicant may request grant funds to provide rental assistance through a contract(s) with a nonprofit organization(s), called a sponsor. The nonprofit organization may be a private nonprofit organization or a community mental health center established as a public nonprofit organization. The units to be used must be owned or leased by the sponsor.

Use of Tax Credit Properties in the S+C Program  Low Income Housing Tax Credit (LIHTC)  Leases must be in the tenants name, not the sponsor.  Sponsors must execute the lease addendum which is provided on the DCA website.

Use of Tax Credit Properties in the S+C Program Sponsor must:  Make sure that this LIHTC property is the ONLY property available that meets the S+C program requirements – contract configuration, availability, HQS, location, etc.  Document due diligence in looking for an alternative property that is not LIHTC.  Acknowledge the unit is a Tax Credit unit by marking “yes” on #4 of the HQS request form and attach all documentation showing due diligence.  Be familiar with the restrictions placed on LIHTC properties.  Complete the lease addendum provided on the DCA webpage.

Use of Tax Credit Properties in the S+C Program Tax credit restrictions to understand:  Leases must be executed by an eligible tenant, not by the Sponsor.  Vacant units should not be “held” waiting for an eligible S+C tenant.  The initial lease term must be at least six months. Thereafter, the lease can be a month to month basis.  Master leases should not be utilized.  Sponsors can execute a lease addendum which can be found on the DCA webpage.  Continuation in the S+C program should not be a condition of the tenant’s lease. However, the tenant can be evicted if rent payments are not made to the property management company.

Use of Tax Credit Properties in the S+C Program What to do now?  Know whether you are currently using a Tax Credit property – do research as necessary.  Send an (to Libby) with a list of all properties currently used by your S+C program - due September 30,  Identify each property as “Tax Credit” or “Not a Tax Credit”.  For those that are Tax Credit, please confirm that you are using the correct leasing arrangements including the lease addendum. If the correct procedure is not being used, please provide a timeline for making these corrections.