Section 15-306-12 - Application for certification of newly constructed or rehabilitated housing projectsWhen an exemption from general excise taxes is requested by a claimant involved with a newly constructed or rehabilitated housing project, the following shall apply.
(1) The developer or general contractor of an eligible housing project shall submit to the corporation completed general excise tax exemption claims (department of taxation form G-37) on behalf of any subcontractors, material houses, real estate sales agencies, or other firms involved with the planning, design, financing, construction, or sale of the housing project;(2) Along with the claim forms, the developer or general contractor shall submit to the corporation the following information on the eligible housing project:(A) A description of the eligible housing project, including the number of housing units affordable to households earning up to fifty per cent, sixty per cent, eighty per cent, ninety-five per cent, and one hundred forty per cent, respectively, of the area median income, as determined by HUD;(B) Authorization for the corporation to conduct on-site inspections of the affordable housing project if the project is not being developed or rehabilitated under the sponsorship of the corporation;(C) A written statement indicating how any cost savings realized from the exemption from general excise taxes will be used;(D) A cover letter requesting the tax exemption, which includes the following:(i) A list of qualified persons or firms previously granted or currently claiming an exemption; and(ii) Contract amounts for each of the qualified persons or firms; and(E) Any additional information necessary for the corporation to make a determination; and(3) Upon receipt, staff of the corporation shall time stamp the claim form.(A) If the person or firm is found to be eligible under these rules, staff shall within ten working days of receipt, so notify the claimant in writing.(B) If a person or entity is found to be ineligible under these rules, staff shall, within ten working days of receipt, so notify the claimant and the developer or general contractor, along with the reason or reasons that the claim is ineligible for an exemption.(4) All projects not yet placed in service shall submit to the corporation annual reports containing the following information: (A) Project status, including, but not limited to, status of construction of affordable units;(B) Total amount of allowable construction costs, allowable development costs, and allowance financing costs accrued to date; and(C) A written statement indicating how any cost savings realized from the exemption from general excise taxes were used;(5) If the claimant is found to be an eligible rental project under these rules, the claimant shall enter into a regulatory agreement with the corporation to ensure the project's continued compliance with the applicable eligibility requirements set forth in section 201H-36, HRS, as follows: (A) For moderate rehabilitation projects, a minimum term of five years following the completion of construction;(B) For substantial rehabilitation projects, a minimum term of ten years following the completion of construction; or(C) For new construction projects, a minimum term of thirty years from the date of issuance of the certificate of occupancy.(6) A project shall be exempt from the requirement set forth in subsection (5) if: (A) The project is a participant in a government assistance program that requires the execution of a deed restriction or other written agreement that restricts the use and operation of the project, and is recorded on the project for a term that meets or exceeds the lengths of the minimum terms set forth in subsection (5); or(B) The project is a for-sale project.(7) Within ten working days after recordation of the regulatory agreement in the bureau of conveyances, staff shall issue a certification for exemption (department of taxation form G-37) and shall forward the original of the certified claim form to the department of taxation. In no event shall the corporation accept a claim for certification more than one year following the close of the claimant's taxable year for which the exemption is claimed.
[Eff 10/08/07; am 09/05/08; am and comp 12/11/10; am and comp 12/11/15] (Auth: HRS §237-29) (Imp: HRS §237-29)