TCAC Proposes 45-Day Deadline Extension Due to Shutdown
On Oct. 21, the California Tax Credit Allocation Committee (TCAC) proposed extending the “Readiness-to-Proceed” deadline that applies to some 2013 low-income housing tax credit sites. The change would allow some in-state credit recipients with federal funding an additional 45 days to close their construction period financing as required under Readiness-to-Proceed point scoring. Under TCAC’s point system, 20 points is available to projects that are able to begin construction within 180 days of the credit reservation.
This change is being proposed as a result of the recent federal government shutdown, which has caused delays in the processing of federal funds and affected projects’ ability to meet the Readiness-to-Proceed requirements within 180 days after the tax credit award date. TCAC staff has contacted first-round credit recipients and determined that out of 21 projects with federal funding, approximately 13 project owners are uncertain as to their ability to meet the 180-day deadline due to the government shutdown. If TCAC approves the new deadline, properties that received funding during the first 2013 allocation round will have until Jan. 23, 2014, to begin construction. Other states may be considering adopting a similar rule due to the government shutdown’s impact.