Housing Credit Enrichment Program
A Capital Solution Designed to Help Housing Agencies
- Evaluate terms and obligations offered by equity providers
- Enhance your capital capacity and liquidity
- Enable participation as sole developer or co-developer
- Ensure long-term affordability
- Enjoy the highest financial return
The Housing Credit Enrichment Program potentially assists housing agencies in Low Income Housing Tax Credit (LIHTC) transactions by:
- Reducing exposure on guaranties provided to Low Income Housing Tax Credit equity investors, including completion guaranties and operating deficit guaranties
- Enhancing the ability to meet equity investor requirements, increasing control and potentially reducing the need for a developer partner
- Increasing the ability for public housing authorities with limited financial capacity or development experience to shoulder more of the guaranty risk so they can negotiate a better return or role in long-term ownership
- Accelerating the payment schedule for the developer fee
- Reducing capitalized reserves or accelerating release of reserves
Is Your Project Eligible?
Low Income Housing Tax Credit projects, both new construction or rehabilitation that are expected to close within 24-36 months, and are sponsored by a public housing authority that own at least 21% of the general partner or managing member entity, are eligible.
How does the Housing Credit Enrichment Program work?
In order to be offered the Housing Credit Enrichment Program, a housing agency or affiliate must become an Associate of Housing Alliance Group, LLC. Housing Alliance Group, LLC delivers the Housing Credit Enrichment Program as a benefit to its associates.
After becoming an Associate of Housing Alliance Group, LLC, housing agencies should reach out to an Account Manager to discuss the development opportunity. Through this discussion, Housing Alliance Group, LLC will learn about the goals of the development opportunity and the role that they would like to take on in this development so that the Housing Credit Enrichment Program may be tailored to best suit the needs of the housing agency.
Housing agencies are encouraged to seek a number of proposals from equity providers, including one from RBC Capital Markets Tax Credit Equity Group, which will include terms with and without the Housing Credit Enrichment Program. Once all equity proposals are received, the public housing authority can determine the value and make a decision accordingly.
If selected, Housing Alliance Group, LLC will agree to pay to, or on behalf of, the housing agency guarantor a share of the Completion Guaranty, the Pre-Stabilization Operating Deficit Guaranty, and the Post-Stabilization Operating Deficit Guaranty if one or more of these obligations arise at a future date.
The extent of the benefits provided by Housing Alliance Group, LLC to the housing agency will determine the one-time fee for Housing Alliance Group, LLC’s participation in the transaction.
All final terms concerning the extent of benefits to be provided by Housing Alliance Group, LLC will be documented in a Certificate of Benefits which is a legally enforceable agreement between the housing agency and Housing Alliance Group, LLC.