ARC 4794C

ARC 4794C

IOWA FINANCE AUTHORITY[265]

Adopted and Filed

Rule making related to qualified allocation plans

The Iowa Finance Authority hereby amends Chapter 12, "Low-Income Housing Tax Credits," Iowa Administrative Code.

Legal Authority for Rule Making

This rule making is adopted under the authority provided in Iowa Code section 16.5.

State or Federal Law Implemented

This rule making implements, in whole or in part, Iowa Code section 16.35 and Section 42 of the Internal Revenue Code.

Purpose and Summary

The updated 2020-21 9% Qualified Allocation Plan (QAP) and the updated 2020-21 4% Qualified Allocation Plan set forth the purposes of the plans, administrative information required for participation, threshold criteria, selection criteria, postreservation requirements, the appeal process, and compliance-monitoring components. The plans also establish the fees for filing an application for low-income housing tax credits and for compliance monitoring. Copies of the QAPs are available upon request from the Authority and are available electronically on the Authority's website at www.iowafinanceauthority.gov. It is the Authority's intent to incorporate the updated 2020-21 QAPs by reference consistent with Iowa Code chapter 17A and 265—subrules 17.4(2) and 17.12(2).

Public Comment and Changes to Rule Making

Notice of Intended Action for this rule making was published in the Iowa Administrative Bulletin on September 25, 2019, as ARC 4665C. A public hearing was held on October 15, 2019, at 10 a.m. at the Authority's offices, 1963 Bell Avenue, Suite 200, Des Moines, Iowa.

Comments on the QAPs received at the public hearing included comments relating to the set-aside awards, underwriting, developer fees, and scoring items. The Authority also received written comments about the QAPs that were similar to the comments made at the public hearing.

The only changes from the amendments published in the Notice were made in rules 265—12.1(16) and 265—12.2(16) to adjust the date subsequent to which no amendments or additions to the QAPs may be included and no modifications or amendments to the Internal Revenue Code may be incorporated by reference. The date proposed in the Notice was September 4, 2019; that date has been changed to November 6, 2019.

In addition, in response to public comments about the QAPs, the Authority made certain changes to the QAPs based on those comments. For example, each state-allowed set-aside category will be limited to one award, allowing more funds for developers in the general pool, and the expenses and debt allowed in underwriting calculations have been adjusted. Also, funds from the HOME Investment Partnerships Program (HOME funds) will be available to rural projects and the Supportive Housing for Families Project. Additionally, as a result of public comments, scoring items related to construction have been eliminated, a late fee has been removed, and the tax credit cap has been increased to assist in reducing development costs.

Adoption of Rule Making

This rule making was adopted by the Authority on November 6, 2019.

Fiscal Impact

The removal of late fees will result in a decrease of revenue for the Authority. Because of fluctuations in the need for payment of late fees, the estimated fiscal impact of removing late fees is uncertain but likely to be less than $10,000.

Jobs Impact

After analysis and review of this rule making, the impact on jobs is expected to be consistent with the impact of previous years' QAPs. The Low-Income Housing Tax Credit Program has had a substantial positive impact on employment in Iowa, creating many jobs annually in the construction, finance, and property management fields, among others.

Waivers

Any person who believes that the application of the discretionary provisions of this rule making would result in hardship or injustice to that person may petition the Authority for a waiver of the discretionary provisions, if any, pursuant to 265—Chapter 18.

Review by Administrative Rules Review Committee

The Administrative Rules Review Committee, a bipartisan legislative committee which oversees rule making by executive branch agencies, may, on its own motion or on written request by any individual or group, review this rule making at its regular monthly meeting or at a special meeting. The Committee's meetings are open to the public, and interested persons may be heard as provided in Iowa Code section 17A.8(6).

Effective Date

This rule making will become effective on January 8, 2020.

The following rule-making actions are adopted:

Item 1. Amend rule 265—12.1(16) as follows:

265—12.1(16) Qualified allocation plans.

12.1(1) Four percent qualified allocation plan. The qualified allocation plan entitled titled Iowa Finance Authority Low-Income Housing Tax Credit Program 2020-21 4% Qualified Allocation Plan ("4% QAP") dated September 5, 2018 November 6, 2019, shall be the qualified allocation plan for the allocation of 4 percent low-income housing tax credits consistent with IRC Section 42 and the applicable Treasury regulations and Iowa Code section 16.35. The 4% QAP is incorporated by reference pursuant to Iowa Code section 17A.6 and 265—subrules 17.4(2) and 17.12(2). The 4% QAP does not include any amendments or editions created subsequent to September 5, 2018 November 6, 2019.

12.1(2) Nine percent qualified allocation plan. The qualified allocation plan entitled titled Iowa Finance Authority Low-Income Housing Tax Credit Program 2019 2020-21 9% Qualified Allocation Plan ("9% QAP") shall be the qualified allocation plan for the allocation of 9 percent low-income housing tax credits consistent with IRC Section 42 and the applicable Treasury regulations and Iowa Code section 16.35. The 9% QAP is incorporated by reference pursuant to Iowa Code section 17A.6 and 265—subrules 17.4(2) and 17.12(2). The 9% QAP does not include any amendments or editions created subsequent to September 5, 2018 November 6, 2019.

Item 2. Amend rule 265—12.2(16) as follows:

265—12.2(16) Location of copies of the plans.

12.2(1) 4% QAP. The 4% QAP can be reviewed and copied in its entirety on the authority's website at www.iowafinanceauthority.gov. Copies of the 4% QAP, application, and all related attachments and exhibits shall be deposited with the administrative rules coordinator and at the state law library and shall be available on the authority's website. The 4% QAP incorporates by reference IRC Section 42 and the regulations in effect as of September 5, 2018 November 6, 2019. Additionally, the 4% QAP incorporates by reference Iowa Code section 16.35. These documents are available from the state law library, and information about these statutes, regulations and rules is on the authority's website.

12.2(2) 9% QAP. The 9% QAP can be reviewed and copied in its entirety on the authority's website at www.iowafinanceauthority.gov. Copies of the 9% QAP, application, and all related attachments and exhibits shall be deposited with the administrative rules coordinator and at the state law library and shall be available on the authority's website. The 9% QAP incorporates by reference IRC Section 42 and the regulations in effect as of September 5, 2018 November 6, 2019. Additionally, the 9% QAP incorporates by reference Iowa Code section 16.35. These documents are available from the state law library, and information about these statutes, regulations and rules is on the authority's website.

[Filed 11/13/19, effective 1/8/20]

[Published 12/4/19]

Editor's Note: For replacement pages for IAC, see IAC Supplement 12/4/19.