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Presentation, discussion, and possible action regarding a material amendment to the Housing Tax Credit Application for Canyon Pass (HTC #20474)
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RECOMMENDED ACTION
recommendation
WHEREAS, Canyon Pass (the Development) received a 4% Housing Tax Credit (HTC) award in 2020 for the new construction of 264 units in San Antonio, Bexar County;
WHEREAS, Pedcor Investments-2019-CLXXV, L.P. (the Development Owner or Owner) requests approval to change the Qualified Low Income Housing Development Election from the requirement that specifies that at least 40% or more of the residential units must be both rent restricted and occupied by individuals whose income is 60% or less of the median gross income (i.e., 40% at 60% minimum set-aside election) to the Average Income set-aside;
WHEREAS, the revised election does not affect how the Development was underwritten because all of the units at the Development are being leased at the 60% Area Median Income (AMI) level;
WHEREAS, Board approval is required for a request to implement a revised election under §42(g) of the Code prior to filing of IRS Form(s) 8609 as directed by 10 TAC §10.405(a)(4)(G), and the Owner has complied with the amendment requirements under 10 TAC §10.405(a); and
WHEREAS, the requested change does not negatively affect the Development, impact the viability of the transaction, or impact the tax credit award;
NOW, therefore, it is hereby
RESOLVED, that the requested material amendment for Canyon Pass is approved as presented at this meeting, and the Executive Director and his designees are each authorized, directed, and empowered to take all necessary action to effectuate the foregoing.
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BACKGROUND
Canyon Pass was approved for a 4% HTC award in 2020 for the new construction of 264 units of multifamily housing in San Antonio, Bexar County. Construction of the Development has been recently completed, and IRS Forms 8609 have not been issued by the Department. The Owner originally elected the requirement that specifies that at least 40% or more of the residential units must be both rent restricted and occupied by individuals whose income is 60% or less of the median gross income (i.e., 40% at 60% minimum set-aside election), and the Owner identified the set-asides for the all units at 60% AMI. In a letter dated October 20, 2023, Jean Latsha, the representative for the Owner, requested approval for a material amendment to HTC Application. The Owner requests to revise the Qualified Low Income Housing Development Election from the 40% at 60% minimum set-aside election to Average Income.
The Owner states that the rent schedule is not changing at this time since the Development is already leasing 100% of the units at 60% AMI, but the requested change is to allow for more flexibility in leasing in the future, including the ability to lease to extremely low income families without a significant loss of revenue, since the lower rents can be off-set with higher rents at the 70% AMI level. The Owner has provided documentation from the lender and the investor acknowledging the requested change.
Staff recommends approval of the material Application amendment request.