HTCC Application Overview May 16 & 23, 2011

1. HTCC Application Overview May 16 & 23, 2011 Presented by: Sheila Stone & Cristina Tsombanos

2. HTCC Application Overview Agenda • Introduction • CHFA-DECD Consolidated Application & Points Calculation Worksheet • Application Timeline & Compliance • Questions and Answers

3. Introduction Presented by: Sheila Stone

4. Program History • The Housing Tax Credit Contribution (HTCC) Program was initiated in 1987 when Act CGS 8-395 was passed by the CT legislature and was administered by the CT Department of Housing • In 1995, CHFA took over the role of administering the • HTCC Program • Since 1987, $155 million in HTCC funds have been awarded

5. Program Intent • The Housing Tax Credit Contribution (HTCC) Program is funded by the state of Connecticut • The intent of the HTCC Program is to provide funding for Housing Programs sponsored by non-profit developers in Connecticut

6. Program Intent • Funding is available for: • Development of rental or homeownership housing in the form of rehabilitation or new construction that benefits very low, low- and moderate-income families • Capitalizing a Revolving Loan Fund that lends money to affordable housing developments in the form of new construction or rehabilitation for low-income individuals purchasing homes • Capitalizing a Workforce Housing Loan fund that lends money to individuals and families purchasing a home in the city/town where they work • Funds must be utilized within 3 years of approval

7. How Does HTCC Funding Work? • Developers submit applications to CHFA; the applications are rated and ranked • Developments are rated and ranked and placed into appropriate set-asides for supportive housing, workforce housing, Tier I and Tier II

8. How Does HTCC Funding Work? • Rating and Ranking focus on the following criteria: • Readiness to Proceed • Use of Funds • Income Groups Serviced • Applicant Capacity/Goals Accomplished • Neighborhood Revitalization and Leveraging • Compliance

9. How Does HTCC Funding Work? • Developments receive reservations up to the point where the $10 million is exhausted • The top-scoring developments are awarded tax credit reservations • Developers obtain commitments from business firms interested in contributing to the development in order to attain a tax credit voucher • The HTCC funds are granted as a one-time payment or “donation” to the housing development or revolving loan fund

10. HTCC 2010 Summary • $10,000,000 available in HTCC Funding • $2,000,000 Supportive Housing Set-Aside • $1,000,000 Workforce Housing Set-Aside • In 2010, 40 Housing Programs applied representing over $17 Million in credit requests • In 2010, 24 Applicants were awarded $10 million in HTCC Funds

11. What’s New for 2011? • A Housing Tax Credit Contribution Agreement will be required to be executed by all non-profit corporations having received a contribution under the HTCC program

12. 20-22 Center Street, New London Completed in 2010

13. HTCC Useful Definitions • FundingGap • Sources less Uses • HTCC Reservation Amount is based on CHFA’s review and determination of the application’s permanent funding gap • Permanent Financing • A long-term mortgage usually intended to finance both land and improvements after completion of construction and/or it is used to pay off a construction loan • HTCC allowable funding is based on permanent financing • Construction Financing • A short-term loan, often unsecured, to a builder or developer to finance the cost of construction

14. HTCC Useful Definitions • Firm Financial Commitment • Firm Financial Commitments are required to receive points • Loans: Evidence in the form of a Letter of Commitment from the lending institution. The letter clearly outlines the accepted terms and conditions. If loan approval is given based on contingencies, the lender must indicate a full underwriting review was conducted. • Grants: Evidence in the form of a Letter of Commitment stating the grant amount or a copy of a check. • Sponsor Equity: Evidence in the form of a copy of a canceled check or a certified letter from a CPA stating the funds are available and allocated for the development; or • A Board Resolution clearly stating the terms and conditions of the loan or grant.

15. The Franklin & The Eleanor, Bridgeport The Franklin: 48 Units – Supportive Housing The Eleanor: Elderly Housing

16. CHFA-DECD Consolidated Application Presented by: Cristina Tsombanos

17. Facts about the CHFA/DECD Consolidated Application: • The CHFA/DECD Consolidated Application is used for all financing programs, including HTCC • The application is built on an Excel platform • The application is distributed and submitted electronically

18. Facts about the CHFA/DECD Consolidated Application: • Formulas are included wherever possible to ensure accuracy and for ease of use by the applicant • Navigation buttons and hyperlinks are included for ease of navigation through the workbook • Instructions are embedded as ‘pop-up comments’ on each worksheet as necessary

19. Facts about the CHFA/DECD Consolidated Application Workbooks • For HTCC, the Application consists of the following: • Workbook 1: General Information and Rental Developments • Workbook 2: Homeownership, Community Impact and Certifications • Workbook 4: HTCC Points Calculation • All three workbooks and any required exhibits must be completed and submitted

20. Facts about the CHFA/DECD Consolidated Application Workbooks • Workbooks can be accessed by opening the CHFA website http://www.chfa.org and scrolling to Quick Links on the right-hand side of the page; then choosing the second item: (CHFA-DECD Consolidated Application)

21. The CHFA/DECD Consolidated Application http://www.chfa.org

22. Facts about the CHFA/DECD Consolidated Application Workbooks • Follow the instructions on this page to download the Consolidated Application

23. The CHFA/DECD Consolidated Application APPLICATION INSTRUCTIONS

24. Facts about the CHFA/DECD Consolidated Application Workbooks • There are no stand-alone instructions • Each workbook includes general instructions

25. The CHFA/DECD Consolidated ApplicationInstructions

26. The CHFA/DECD Consolidated ApplicationExhibit Checklist • The Exhibit Checklist identifies which documents are required for specific application submissions • Links to the application and supporting documents are embedded in the sheet for ease of navigation • Each updated submission is numbered automatically

27. The CHFA/DECD Consolidated ApplicationHelpful Hints • Any cell shaded GRAY contains self-generating summary calculations and cannot be filled. If a cell is not auto-filling, it means additional information must still be entered on this or another worksheet • Any cell shaded LIGHT YELLOW requires the applicant to input the requested information • Any cell shaded LIGHT BLUE is for CHFA use only

28. The CHFA/DECD Consolidated ApplicationExhibit Checklist

29. The CHFA/DECD Consolidated Application Cover Sheet

30. The CHFA/DECD Consolidated Application Summary Sheet • No data is entered on the Summary Sheet; Summary information is calculated from data entered on other sheets • The Summary Sheet provides the Applicant, Underwriter and Project Manager a snapshot of the overall application

31. The CHFA/DECD Consolidated Application Summary Sheet

32. The CHFA/DECD Consolidated Application Application Page Complete all items unless noted in red to be for a different financing program, (i.e., DECD Only).

33. The CHFA/DECD Consolidated Application Application Page Hyperlinks on the Application Page take you to the referenced exhibit; tabs may be used as well.

34. The CHFA/DECD Consolidated Application Workbook • The Workbooks contain an Exhibit Checklist worksheet, Points Calculation worksheet, and required forms • The Exhibit Checklist worksheet contains links to the required forms • If there is no form for an exhibit, the Points Calculation worksheet will have a detailed description of what is required

35. The CHFA/DECD Consolidated Application Submission • Applicants must submit one binder containing all completed workbooks and all required exhibits • Workbooks must also be e-mailed to CHFA at TaxCreditApps@chfa.org

36. Application Timeline & Compliance Presented by: Sheila Stone

37. 2011 Applicant Timeline • CHFA is using the CHFA-DECD Consolidated Application which is currently posted on our website • July 1, 2011 • One paper copy of the CHFA-DECD Consolidated Application and an electronic submission of the application are due at CHFA Offices in Rocky Hill no later than 4:00 p.m. • July, 2011 • Deficiency letters are sent to applicants • Applicants have two weeks to respond • September 1, 2011 • List of eligible Housing Programs of non-profit corporations to which business firms contribute is posted on-line by CHFA

38. 2011 Applicant Timeline(cont’d) • November 1, 2011 • Contributing Business Firm applications, set-asides and Tier I recipients are due at CHFA Offices in Rocky Hill by 4:00 p.m. • Uncommitted funds become available to all applicants depending on their placement in the Rating and Ranking • December 1, 2011 • Applications for Contributing Business Firms for uncommitted funds are due at CHFA Offices in Rocky Hill by 4:00 p.m.

39. HTCC Compliance • Once credits have been awarded, applicants are required to submit Quarterly Reports: • Reports are due the first Quarter after funds have been allocated. For example, if funds were allocated in the 2010 round, submit the first quarterly report on April 15, 2012 • Reports must be submitted no later than the 15th of April, July, October, and January each year • If the 15th falls on a Saturday or Sunday, submissions are due the next business day • If reports are not submitted in a timely fashion, subsequent year points will be negatively affected

40. HTCC Compliance • Certificates of Occupancy [CO] and the Certificate of Completion [CC] • When the project is complete, forward copies of the appropriate certificates to: CHFA ‘Attn: Tax Credit Unit’ • Failure to submit COs in a timely fashion will negatively impact points for future CHFA-DECD Consolidated Applications • Note: The CHFA Certificate of Completion must be the notarized original • These documents allow CHFA staff to close out the HTCC project files

41. Belden Street, New London Two-Family Home Completed in 2009

42. Jarvis Court Homes, Fairfield 8 units supportive housing Completed in 2008

43. Questions & Answers