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What you need to know about the Low Income Housing Tax Credit Set-Aside program


Here are some takeaways from Thursday’s informational meeting about the new Innovation Set-Aside for the Low Income Housing Tax Credit Program through the Iowa Finance Authority.

Derek Folden, tax credit director of the Iowa Finance Authority, provided an overview of the program during a virtual meeting attended by about 50 people. Here are some highlights from his presentation.

  1. The Innovation Set-aside is geared toward one of the core values of the Iowa Finance Authority and Iowa Economic Development Authority, and ventures beyond usual construction operations and methodology to dig deeper into innovative approaches to developing affordable housing.
  2. A pre-application process is now open with a July 17 deadline to submit a pre-application. Pre-applications do not need to include a community, site, financing or plans. Pre-applications only need to include key partners and a concept that explains why the innovation would be advantageous to residents and a community. “What I’m hoping is there could be people out there who work in zero carbon or energy or any building areas that have innovative concepts used in other industries,” Folden said. “We’d like to see those possibly looked at and applied here.”
  3. Viable, light-tech, experienced developers need to be partners in the venture. “We can’t jump on innovation that has no experience in the program because it is a longer-term affordable housing, 30-year program. We’re hoping between developers and innovators we can combine it together here and find some new proposals,” Folden said.
  4. Proposals can be for single-family residential, townhomes, apartments or adaptive reuse of older buildings, such as schools.
  5. Iowa Finance Authority staff will review pre-applications and extend invitations by Aug. 1 to as many as six proposals to pitch their concepts at the 2023 HousingIowa Conference on Sept. 6-8 in Cedar Rapids. Applicants will present their concepts to a panel of experts, who will make a recommendation for one finalist during the conference. That finalist will have until mid-April 2024 to finalize plans, financing, a community and site for their project. They will be the only applicant for the 2024 round of funding, “and it will be their clear path to succeed with an award, which is a big deal,” Folden said. The selected proposal could be awarded $1 million.
  6. The $500 pre-application fee will go to the Iowa Builders Association for a scholarship program for high school students pursuing a career in construction innovation.

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