title
Presentation, discussion and possible action regarding a waiver of 10 TAC §11.101(b)(1)(A)(vii) of the Qualified Allocation Plan (QAP) relating to the percentage of efficiency and/or one-bedroom units for Oak Hill Lofts (#24495).
end
RECOMMENDED ACTION
recommendation
WHEREAS, a 4% Housing Tax Credit application for Oak Hill Lofts was submitted to the Department on September 20, 2024;
WHEREAS, the unit mix includes more than 30% efficiency and/or one-bedroom units, which exceeds the threshold allowed in 10 TAC §11.101(b)(1)(A)(vii) of the 2024 QAP, thus rendering the development ineligible;
WHEREAS, a waiver was previously considered and tabled by the Board at the Board meeting on October 10, 2024, pending submission to staff of application exhibits that reflect a unit mix that does not exceed 34% efficiency and/or one-bedroom units;
WHEREAS, application exhibits have been provided that reflect a unit mix of 33.33% efficiency and/or one-bedroom units; and
WHEREAS, based on discussion at the Board meeting of October 10, 2024, that reflected a desire to re-consider the waiver request pending submission of revised exhibits with a unit mix that does not exceed 34% efficiency and/or one-bedroom units, which is in-line with proposed changes to the 2025 QAP that increases this threshold to 35%, staff recommends the waiver be granted;
NOW, therefore, it is hereby
RESOLVED, that a waiver of §11.101(b)(1)(A)(vii) of the 2024 QAP relating to the allowable percentage of efficiency and/or one-bedroom units for Oak Hill Lofts is hereby granted.
end
BACKGROUND
General Information: Oak Hill Lofts is to be located in Austin, Travis County, and proposes the new construction of 90 units that will serve the general population. The Certificate of Reservation from the Bond Review Board was issued on August 8, 2024, under the Priority 3 designation, which does not require any specific restrictions on rent or income. The applicant has indicated that the development will include a mix of units with rents restricted between 30% and 80% of Area Median Family Income (AMFI).
Waiver Request: Pursuant to §11.101(b)(1)(A)(vii) of the QAP, “any New Construction, Reconstruction, or Adaptive Reuse Development proposing more than 30% efficiency and/or one-Bedroom Units will be considered ineligible. This requirement will not apply to Elderly or Supportive Housing Developments.”
The unit mix for Oak Hill Lofts consists of 30 one-bedroom units, 50 two-bedroom units, and 10 three-bedroom units. The number of one-bedroom units comprises approximately 33% of the total unit count. The applicant has requested a waiver of the aforementioned rule, so that the development may be eligible without necessitating a change to the currently proposed unit mix.
According to the waiver request submitted, the development site was purchased in 2021, and the project was originally contemplated to utilize off-site modular construction. In 2023, the developer submitted a 4% Housing Tax Credit application for this development that adhered to the efficiency/1-bedroom unit limitation, but that application was ultimately withdrawn. Due to issues with suppliers, the developer decided to reconfigure the project, and now proposes traditional new construction instead of modular construction. As a result of that reconfiguration, the proposed development now includes 33.33% one-bedroom units and is considered ineligible under the 2024 QAP. The applicant notes that the redesign resulted in 38% more bedrooms than the previous configuration; however, it was reconfigured in a way that violates the QAP.
The applicant previously submitted a waiver request that proposed the percentage of one-bedroom units in the development be 56%, or 50 total one-bedroom units. This request was presented to, and discussed by, the TDHCA Board at the Board meeting on October 10, 2024. During the presentation and discussion of this request, the applicant made the Board aware that the development could be redesigned once again to lower the number of one-bedroom units to 30, or 33.33% of the total unit count. The Board voted to table the item and instructed the applicant to submit revised architectural plans and application exhibits that reflected this reduced one-bedroom unit count. Subsequent to the Board meeting, the applicant submitted revised plans and exhibits, and staff reviewed those updates to be sure they adhered to the limits represented by the applicant to the Board, i.e. a maximum of 30 one-bedroom units, or 33.33% of the total unit count.
Based on the discussion at the Board meeting on October 10, 2024, and subsequent revisions to the application to reduce the number of one-bedroom units in the development, which are in line with Board instruction, staff recommends that a waiver of §11.101(b)(1)(A)(vii) be granted.