Chicago Streamlines LIHTC Process with New QAP
Chicago Mayor Lori Lightfoot’s administration is changing the rules for how the city allocates federal low-income housing tax credits (LIHTCs). The city recently released a new Qualification Allocation Plan (QAP), which details the application process that developers must follow to obtain LIHTCs.
The Illinois Housing Department Authority (IHDA) has said Illinois’ program has largely been successful. However, Chicago, which receives LIHTC credits separately, has had an inconsistent application process for developers, which has “hampered” their ability to financially plan for projects in previous years. Lightfoot’s administration is focused on creating more affordable housing, which is shrinking.
“By creating a more efficient system, we are ensuring that creating affordable housing is more predictable and more streamlined for both developers and advocates, and ultimately more impactful in addressing the needs of our families and our communities,” Lightfoot said in a statement.
The new plan includes changes and rules that make affordable housing projects easier to get off the ground. It focuses on directing $60 million affordable housing resources to areas of the city that are most in need.
Developers will now get an estimate of how many housing credits are in the round and the number of awardees that can receive the funding. It will also indicate specific locations, building types, and affordability levels that the city is prioritizing. In addition, the QAP will coordinate the application process with Chicago’s Continuum of Care, which is a government organization that provides housing and services for people experiencing homelessness.
Developers must also guarantee 30 years of affordable housing. Projects can also now average lower- and higher-income units in the property to meet requirements.
A new QAP with selection criteria and available credits will be released by the Department of Housing (DOH) every two years. Previously, the city issued credits every two or three years.