Each year, state governments release what they call Qualified Action Plans (QAP). A QAP is a state's general plan regarding affordable housing development and funding allocations. Over the last few months, states have begun releasing their QAPs for the coming fiscal year.
Both Louisiana and California released draft versions of their plans earlier this year. Tens of millions of dollars is being allocated through each plan, which specifies how and where low-income housing can be developed.
Louisiana's draft plan lists four low-income housing tax credit "allocation pools" - four different designations through which tax credits are allocated for development projects. There are separate pools for non-profit and Community Housing Development Organizations (CHDO), public housing agencies, rural projects, and general LIHTC allocations. Most of the designations are self-explanatory.
A CHDO is, according to the Department of Housing and Urban Development's (HUD) web site: "a private nonprofit, community-based service organization whose primary purpose is to provide and develop decent affordable housing for the community it serves." CHDO's can be founded by for-profit organizations and business entities, but those entities cannot have a direct interest in housing development. In other words, a CHDO cannot be founded by a developer, construction company, housing management company, or a real estate agent or firm.
The current draft of Louisiana's plan allows for nearly $20 million in tax credits, with the highest percentage (nearly $10 million) being allocated through the general pool. About $5.9 million will be awarded to rural areas, $1.9 million to public housing, and $1.9 million to non-profits and CHDOs. Under the draft plan, no more than $1.5 million will be awarded to a single project, or $1 million for rural projects. Another $3 million is available via the HOME Investment Partnership Program.
Similarly, California's plan outlines the states goals for several federally funded programs, including: Community Development Block Grants (CDBG), Neighborhood Stabilization Program (NSP), Home Investment Partnerships Program (HOME) and Housing Opportunities for Persons with AIDS (HOPWA).
During the 2009-2010 fiscal year, over 30,000 households and homeless individuals received some form of assistance through these programs. The CDBG, HOME and HOPWA programs aided over 3,000 households. Almost half of them had incomes at or below 30 percent of their region's average. A combined total of over $100 million dollars was awarded through the CDBG, NSP and HOME programs.
For the coming fiscal year, the California Department of Housing and Community Development estimates that nearly $140 million will be awarded through seven programs: CDBG, CDBG Disaster Relief Recovery Enhancement Fund, NSP, HOME, Federal Emergency Shelter Grant (FESG), HOPWA and Lead Based Paint Hazard Control Program (LHCP). The HOME program is expected to receive the largest amount of funding, over $57 million. Community Development Block Grants are next in line at nearly $40 million.
These draft plans are important tools, used by cities and states to better define their housing policies and determine how best to spend their limited resources. Drafts are generally made available to the public, and comments are welcomed. In addition, public hearings are scheduled at which interested community members can ask questions, and voice their dissent or support of proposed QAPs. Most cities and states aim to have their plans finalized before the start of the next fiscal year.
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