Contents

1 1 2 Contents I) Introduction .. 4 A. Purpose of the QAP .. 4 B. Authority Mission Statement .. 4 C. Authority Policy Priorities & Objectives .. 4 D. Code Required Selection Criteria and Preferences .. 5 E. State Comprehensive Housing Planning Act .. 6 II) General Provisions .. 6 A. Changes to the QAP .. 6 B. Authority Rights .. 6 C. Authority Limitations .. 7 D. Project Application Disclosures .. 7 E. The Fair Housing Act .. 8 F. Affirmatively Furthering Fair Housing .. 8 III) Tax Credit Information .. 8 A. Tax Credit Calculation.

2 8 B. 4% Tax Credit Projects .. 9 C. 9% Tax Credit Projects .. 11 IV) Geographic Set-Asides .. 11 A. Percentages for All Set-Asides .. 11 B. Set-Aside Descriptions .. 12 C. Statewide Set-Aside .. 12 V) Project Application Process .. 12 VI) Preliminary Project Assessment .. 13 A. About the 13 B. Timing .. 13 C. PPA Submission .. 13 D. Fees .. 13 E. PPA Evaluation .. 13 F. PPA Review/Outcome Strategy .. 15 G. PPA Notification Letters .. 16 H. Conditional Approval/Unmet Conditions .. 16 I. Changes between PPA and Project Application .. 17 VII) Project Application Overview.

3 17 A. Submission & Timing .. 17 B. Fees .. 18 C. Project Application Materials .. 18 D. Evaluation .. 18 E. Conditional allocation of Tax Credits .. 19 VIII) Project Application - Mandatory Components .. 19 A. Project Narrative .. 19 B. Public Outreach .. 20 C. Community Engagement .. 20 D. Site Control .. 20 E. Zoning .. 21 F. Site Physical Information .. 22 3 G. Historic Preservation .. 24 H. Phase I Environmental .. 24 I. Architectural Requirements .. 24 J. Construction Cost Breakdown .. 26 K. Projects Involving Rehabilitation & Adaptive Reuse.

4 27 L. Relocation .. 28 M. Market Study .. 28 N. Development Team .. 29 O. Financial Feasibility .. 31 P. Enterprise Green Communities .. 32 Q. Special Population Considerations .. 32 R. Permissible Waiver Requests .. 33 S. Application Certification, Organizational Chart, and Identity of Interest 33 IX) Project Application - Scoring Components .. 34 Scoring Overview .. 34 A. Project Design and Construction .. 35 B. Energy Efficiency and Sustainability .. 36 C. Community Characteristics .. 38 D. Development Team Characteristics .. 44 E.

5 Financial Characteristics .. 46 F. Housing Policy and Objectives .. 49 X) Project Modifications and Revocations .. 50 A. Project Modifications .. 50 B. Request for Modifications .. 50 C. Revocation of a Conditional allocation .. 50 XI) 9% Tax Credit Reservations, Carryover, and 10% Test .. 51 A. 9% Tax Credit allocation .. 51 B. 9% Tax Credit Carryover Allocations .. 51 C. 9% Tax Credit Ten Percent (10%) Test .. 52 XII) Operations and Monitoring .. 52 A. Issuance of 8609 .. 52 B. Placement in Service .. 53 C. Extended Use Agreement .. 53 D.

6 Required Monitoring .. 53 Appendix A: Definitions .. 56 4 I) Introduction A. Purpose of the QAP The Low-Income Housing Tax Credit (LIHTC) program was created by the United States Congress in 1986 to promote the development of affordable housing for low-income individuals and families. The Internal Revenue Service (IRS) regulations for the Tax Credit program are found under Section 42 of the Code of 1986, as amended. As an allocating agency for the Tax Credit program in Illinois, the Illinois Housing Development Authority (Authority) is required to publish a Qualified allocation Plan (QAP) that details how it intends to award the tax credits.

7 Pursuant to Section 42 of the Code, the QAP describes criteria the Authority considers in evaluating Projects and development teams applying for an allocation of Tax Credits. The QAP addresses the process for obtaining Tax Credits either through the issuance of a 42(m) Letter for Projects financed through the issuance of tax-exempt bonds (4% Tax Credits) or through the competitive selection process (9% Tax Credits). All Projects planning to apply to the Authority for an allocation of 4% or 9% Tax Credits must first submit a Preliminary Project Assessment to the Authority prior to submitting a Project Application.

8 Please visit the Developer Resource Center on IHDA s website for further information on applying for Authority tax credit resources. B. Authority Mission Statement The mission of the Authority is to finance the creation and preservation of affordable housing throughout the State of Illinois. We partner with lenders, developers, local government, nonprofits, community groups, and others to deliver low-cost financing programs. We provide financial assistance to low- and moderate-income homebuyers and homeowners, offer resources to developers who build or preserve affordable and mixed-income rental housing, and provide oversight for more than 1,900 affordable rental communities across the state.

9 C. Authority Policy Priorities & Objectives The QAP provides a framework for the development and rehabilitation of affordable rental units that support the achievement of broader policy objectives. The Authority employs various planning and research methods to better understand the diverse housing needs of Illinois residents, identify policy priorities and goals, and develop policy objectives in support of those goals. These research methods are designed to identify opportunities for the Authority to target its investments effectively and efficiently, nimbly responding to an ever-changing social and economic climate.

10 This research utilizes both quantitative and qualitative methods including, but not limited to, development of the Annual Comprehensive Housing Plan and the Illinois Housing Blueprint, public meetings such as the QAP Summits, and formation of an internal QAP Task Force. The Authority s current policy priorities, goals, and objectives for the 2022-2023 QAP are discussed below. These priorities have been identified in response to broader economic and socio-demographic conditions, as well as key housing needs at the state level. Each of the four (4) focus areas is supported by specific strategies.