109-00-17 Ark. Code R. § 1
Current through Register Vol. 49, No. 4, April, 2024
Rule 109.00.17-001 - Guidelines for Reserving Volume Cap for Mulit-Family Housing Bonds109.04.2-VI Fees. A. APPLICATION FEE. A Five Hundred Dollar ($500) non-refundable application fee is payable at the time an application is submitted to ADFA. Applications submitted without the application fee will be considered incomplete,B. ISSUANCE FEE (ADFA ISSUES ONLY), A one-time fee of 0.5%, based on the principal amount of bonds issued, is payable at the bond closing for bonds with a maturity date of five (5) years or less, An annual fee of 0.125%, based on the principal amount of bonds issued, is payable on October 1 of each year the bonds remain outstanding for bonds with a maturity date in excess of five (5) years.
C. LOW-INCOME HOUSING TAX CREDITS ("LIHTC") FEES.1. RESERVATION OF CREDIT FEE. A non-refundable reservation fee of One Hundred Dollars ($100) per low-income unit will be required at the bond closing.2. AWARD OF CREDIT FEE. An award of credit fee of One Hundred Fifty Dollars ($150) per low-income unit will be required at the time the credits are awarded (at issuance of IRS Form 8609).3. COMPLIANCE/MONITORING FEE. A compliance and monitoring fee of six percent (6%) of the amount of annual credits is required to be paid at the time the credits are awarded (at issuance of IRS Form 8609). In addition, a monitoring fee of $50 per low-income housing tax credit unit inspected will be owed to the Authority following any on-site compliance and monitoring inspection conducted by the Authority during the extended period following the close of the 15-year compliance period. Summary of Proposed Rule
The purpose of the proposed rule is to allow the issuance of short-term bonds for the development of affordable, multi-family residential rental developments. It is necessary because short-term bonds are the only financially feasible vehicle that can generate the equity needed to rehabilitate affordable rental complexes which have more than seventy-five (75) units. ADFA's Housing Department is allocated roughly $30 million in volume cap each year for the issuance of tax-exempt multi-family bonds. ADFA has not issued multi-family bonds in nearly a decade. The cause for the lack of issuances is existing language in the Guidelines that restricts the use of multi-family bonds only for permanent financing. This language was incorporated into the Guidelines when market conditions caused high demand for tax-exempt private activity bond volume cap. The current market conditions are starkly different. There is little demand for tax-exempt bonds; therefore, little demand for tax-exempt multi-family bonds for the purposes of permanent financing, This means the tax-exempt private activity bond volume cap for Arkansas has gone untapped.
The proposed rule addresses two items. First, it removes language that restricts the use of multi-family bonds only for permanent financing. Second, it provides for a new issuance fee structure if a bond's maturity date is five years or less. Adopting this proposed rule will allow ADFA to issue short-term bonds. These bonds will be outstanding for the duration of the construction/reconstruction period and subsequently paid off by the applicant,
109.04.2-VI.Fees. A. APPLICATION FEE. A Five Hundred Dollar ($500) non-refundable application fee is payable at the time an application is submitted to ADFA. Applications submitted without the application fee will be considered incomplete.B. ISSUANCE FEE (ADFA ISSUES ONLY). A one-time fee of 0.4^5%, based on the principal amount of bonds issued, is payable at the bond closing for bonds with a maturity date of .five 15) years or less. An annual fee of 0.125%. based on. the principal amount of bonds issued, is payable on October 1 of each year the bonds remain outstanding for bonds with a maturity date in excess of five (5) years.
C. LOW-INCOME HOUSING TAX CREDITS ("LIHTC") FEES.1. RESERVATION OF CREDIT FEE. A non-refundable reservation fee of One Hundred Dollars (SI00) per low-income unit will be required at the bond closing.2. AWARD OF CREDIT FEE, An award of credit fee of One Hundred Fifty Dollars ($1500) per low-income unit will be required at the time the credits are awarded (at issuance of IRS Form 8609).3. COMPLIANCE/MONITORING FEE. A compliance and monitoring fee of six percent (6%) of the amount of annual credits is required to be paid at the time the credits are awarded (at issuance of IRS Form 8609). In addition, a monitoring fee of $50 per low-income housing tax credit unit inspected will be owed to the Authority following any on-site compliance and monitoring inspection conducted by the Authority during the extended period following the close of the 15-year compliance period.109.00.17 Ark. Code R. § 001