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Presentation, discussion, and possible action regarding a Material Amendment to the Housing Tax Credit Application and a request for return and reallocation of tax credits under 10 TAC §11.6(5) related to Credit Returns Resulting from Force Majeure Events for Autumn Parc (HTC #23229)
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RECOMMENDED ACTION
recommendation
WHEREAS, Autumn Parc (the Development) received an award of 9% Housing Tax Credits (HTCs) for the new construction of 57 multifamily units, of which 45 are designated as low-income units, for the general population in Arlington, Tarrant County;
WHEREAS, AT Arkansas Housing LP (the Applicant) requests approval for a material amendment to the Application for a decrease to the number of units from 57 to 51, which consists of a decrease of six market units, a decrease to the acreage from 2.57 acres to 2.521 acres, which changes the residential density from 22.179 units per acre to 20.230 units per acre, a 8.79% decrease in density, and changes to the site plan and architectural design, which also include a reduction of the Net Rentable Area (NRA) from 55,110 square feet to 47,716 square feet, which represents a reduction of 7,394 square feet (13.42%), and a 1,967 square foot (15.44%) reduction to Common Area, going from 12,736 square feet to 10,769 square feet;
WHEREAS, Board approval is required for a significant modification of the site plan, a modification of the number of units or bedroom mix of units, a reduction of 3% or more in the square footage of the units or common areas, a significant modification of the architectural design of the Development, and for a modification of the residential density of at least 5%, as directed in Tex. Gov’t Code §2306.6712(d)(1), (2), (4), (5), and (6) and 10 TAC §10.405(a)(4)(A), (B), (D), (E), and (F), and the Applicant has complied with the amendment requirements therein;
WHEREAS, Board approval of this amendment does not constitute a waiver of any of the rules or statutes applicable to the 2023 HTC Application, including but not limited to the accessibility requirements stated in Chapter 1, Subchapter B;
WHEREAS, the requested changes do not negatively affect the Development, impact the viability of the transaction, impact the scoring of the Application, or change the amount of the tax credits awarded;
WHEREAS, in 2024, the Board approved a request for the credits to be returned and reallocated due to Force Majeure Events;
WHEREAS, the Development Owner executed a Carryover Allocation Agreement that included certifications stating each building receiving an allocation would be placed in service by December 31, 2026;
WHEREAS, the Development Owner has requested an extension to the placement in service deadline under 10 TAC §11.6(5), related to Credit Returns Resulting from Force Majeure Events;
WHEREAS, the Department lacks authority to extend federal placement in service deadlines and may only reset such deadlines by requiring the credits to be returned and immediately reallocated to the Development, as permitted solely under the force majeure provision of the Qualified Allocation Plan (QAP); and
WHEREAS, the Development Owner has submitted documentation demonstrating that a qualifying force majeure event has occurred;
NOW, therefore, it is hereby
RESOLVED, that the requested amendment for Autumn Parc is approved as presented at this meeting, and the Executive Director and his designees are each hereby authorized, directed, and empowered to take all necessary action to effectuate the foregoing; and
FURTHER RESOLVED, that the request to treat the matter under the force majeure provisions of 10 TAC §11.6(5) is approved, and that the 2023 Qualified Allocation Plan, Uniform Multifamily Rules, and the 2025 Program Calendar shall be applicable to the Development, with a new deadline to place in service of December 31, 2027.
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AMENDMENT BACKGROUND
Autumn Parc received a 9% HTC award 2023 and a Force Majeure reallocation of tax credits in 2024 to construct 57 units, of which 45 are designated as low-income units, for the general population in Arlington, Tarrant County. In a letter dated September 22, 2025, Alyssa Carpenter, representative for the Applicant, requested approval for changes to the site plan and architectural design, which among other changes, will result in a decrease to the total number of units from 57 to 51 by decreasing the number of market rate units by six.
The Applicant explained that Autumn Parc was proposed to have 57 total units with a detention area at the northwest corner of the Development site. During the site plan review process, the City of Arlington (the City) required a comprehensive drainage study and then required a detention system to mitigate both the Development’s drainage as well as drainage for adjacent properties. Due to limited space on the Development site, an underground detention system would be required. The developer submitted five full drainage plan submittals and worked through comments with the City of Arlington from 2024 through July 2025; however, the City continued to express concerns about the underground detention system citing limited experience with the proposed design and materials. During preparation of a sixth submittal, alternatives to an underground detention system were discussed, and the City indicated that the site plan submitted with this amendment request, which includes detention in a wide drainage channel along the western side of the development site, would be acceptable and eliminate the need for underground detention.
In order to accommodate the wide drainage channel, the Development, originally proposed with 57 total units in two buildings, is now proposing 51 units in one building. At Application, 12 of the 57 units were market rate, and with this amendment, the number of market rate units will decrease by six. This amendment proposes no change to the total number of low-income units from Application; there will be 45 low-income units and six market rate units.
As a result of this amendment, the revised unit mix will consist of 15 one-bedroom units, 26 two-bedroom units, and 10 three-bedroom units instead of the originally proposed 15 one-bedroom units, 24 two-bedroom units, and 18 three-bedroom units. This change in the number of units will also result in a decrease in net rentable area from 55,110 square feet at Application to 47,716 square feet, which is a decrease of 13.42% or 7,394 square feet. Common Area will decrease from 12,736 square feet at Application to 10,769 square feet, which is a decrease of 15.44% or 1,967 square feet. At Application, the Development site was 2.57 acres based on a survey that incorrectly included the sidewalk adjacent to the street. The final ALTA survey for the site identifies an acreage of 2.521 acres, which does not include the sidewalk adjacent to the street. The change in acreage and decrease in the number of units results in an 8.79% decrease in the residential density, going from 22.179 units per acre to 20.230 units per acre. Parking will be reduced from 119 spaces to 102 spaces.
The Development was re-underwritten with the proposed amendment information. The analysis supports no change to the HTC allocation and demonstrates the Development remains feasible.
Staff confirmed that the revised design plans and parking will continue to meet accessibility requirements. Additionally, staff reviewed the original Application and scoring documentation against this amendment request and has concluded that none of the changes would have resulted in selection or threshold criteria changes that would have affected the selection of the Application in the competitive round.
Staff recommends approval of the amendment request as presented herein.
FORCE MAJEURE BACKGROUND
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Development |
Autumn Parc |
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Target Population |
General |
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HTC Award |
$1,350,196 |
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City |
Arlington |
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Total Units |
51 (after amendment) |
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HTC Units |
45 |
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Initial Year of Award |
2023 |
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Extension Requested |
One year |
Autumn Parc is a 51-unit development located in Arlington, Tarrant County. The development received an award of 9% Housing Tax Credits in 2023, and was approved for treatment under the Force Majeure rule in 2024. As a result, the current deadline to place in service in December 31, 2026.
Since commencing construction, the project has experienced multiple events that delayed construction, including delays caused by the City of Arlington’s review processes related to a required drainage study and underground detention system design. These delays have disrupted the project’s permitting, design, and HUD financing timelines, making it impossible to meet the October 2025 10% Test and the December 2026 placed-in-service deadline. To address these issues, the owner has redesigned the project to remove the underground detention system, retaining all affordable units but requiring new city approvals and extending the schedule.
APPLICABLE RULE
Under 10 TAC §11.6(5), a Development Owner may return credits and receive a reallocation outside the standard allocation process if the return is the result of a qualifying force majeure event occurring prior to issuance of IRS Form(s) 8609. Pursuant to 10 TAC §11.6(5), the Department’s Governing Board may approve execution of a Carryover Allocation Agreement for the current program year with the Development Owner that returned the credits, but only if the following conditions are met:
(A) The credits were returned as a result of "Force Majeure" events that occurred before issuance of Forms 8609. Force Majeure events are the following sudden and unforeseen circumstances outside the control of the Development Owner: acts of God such as fire, tornado, flooding, significant and unusual rainfall or subfreezing temperatures, or loss of access to necessary water or utilities as a direct result of significant weather events; explosion; vandalism; orders or acts of military authority; unrelated party litigation; changes in law, rules, or regulations; national emergency or insurrection; riot; acts of terrorism; supplier failures; or materials or labor shortages. If a Force Majeure event is also a presidentially declared disaster, the Department may treat the matter under the applicable federal provisions. Force Majeure events must make construction activity impossible or materially impede its progress.
Staff has reviewed this request and determined that delays related to the permitting process constitute a force majeure event under the rules.
IMPACT OF BOARD DECISION
If the Board approves the request:
• The credits will be returned and reallocated, with the 2023 Qualified Allocation Plan, Uniform Multifamily Rules, and the 2025 Program Calendar applicable to the Development.
• A new Carryover Allocation Agreement will be executed.
• The new 10% Test deadline will be July 1, 2026.
• The new placed in service deadline will be December 31, 2027.
If the Board denies the request:
• The current placed in service deadline of December 31, 2026, remains in place.
• The Development Owner may either meet the existing deadline, return the credits, or have the award terminated for failing to meet the deadline.
• Returned credits will first be reallocated within the original subregion in accordance with 10 TAC §11.6(2). If no pending applications are eligible within the subregion, the credits will be added to the statewide collapse for reallocation.
This request has no impact on any funding source other than the Low Income Housing Tax Credit program.
RECOMMENDATION
Staff recommends approval of the request to return and reallocate tax credits for Autumn Parc under the force majeure provisions of 10 TAC §11.6(5).