# Presentation: 290350

## Securing Resources for RD 515 Preservation

## Preservation Efforts To Date

- 2007 Qualified Allocation Plan:
- Preservation Set-aside
- Rural Set-aside
- 2008 Qualified Allocation Plan:
- Affordable Preservation Set-aside
- Section 515 Rural Rental Housing eligible
- Underserved Set-aside
- Counties not located in an MSA and have not received an allocation of tax credits in the past five years

## Section 515 in Iowa

- 610 properties currently operating in Iowa
- Reduction from 980 properties that originally were established using Section 515

## Reasons for Reduction

- A market no longer existed in the community for affordable units;
- The property owner no longer desires to comply with the program requirements;
- The property owner need to update the property and there is not access to capital to make improvements; or
- The property owner is aging and no longer desires to own and manage the property.

## RD 515 in Iowa

- State office of USDA-RD has identified 19 projects that are at risk of leaving the 515 program and are potential candidates for preservation

## RD Preservation III, Emmetsburg & Spencer

-  210-214 N State (Emmetsburg)
-  611-613 E 19th & 511/600 E 19th Street (Spencer)
-  84 units, Eight buildings
-  Underserved Area Set-Aside
-  Occupancy type: Family
-  Special need: Self-sufficiency
-  Construction type: Rehabilitation
-  LIHTC award: $2,433,800
-  Sponsor: National Affordable Housing Foundation

## RD Preservation II, Winterset & Carlisle

-  426/428 W Mills & 1019/1107 N 8th (Winterset)
-  1225/1245 Hardin (Carlisle)
-  72 units, Eight buildings
-  Nonprofit Set-Aside
-  Occupancy type: Family
-  Special need: Self-sufficiency
-  Construction type: Rehabilitation
-  LIHTC award: $2,294,140
-  Sponsor: National Affordable Housing Foundation

## RD  Preservation IV, Mitchellville

-  401/403/405/407 Center Avenue S
-  24 units, Four buildings
-  General Pool
-  Occupancy type: Family
-  Special need: Self-sufficiency
-  Construction type: Rehabilitation
-  LIHTC award: $829,700
-  Sponsor: National Affordable Housing Foundation

## Major new initiative
Received $2 million loan through the RD Preservation Revolving Loan Fund
Mission: Preserve and revitalize existing Section 515 properties in rural Iowa communities where both a market need exists, and the use of additional financial resources externs the viability of the property for at least 30 additional years.

- Received $2 million loan through the RD Preservation Revolving Loan Fund
- Mission: Preserve and revitalize existing Section 515 properties in rural Iowa communities where both a market need exists, and the use of additional financial resources externs the viability of the property for at least 30 additional years.

- RD 515 Preservation Demonstration

## Break down three major barriers to the successful preservation:
Regulatory and programmatic requirements associated with multiple funding sources
Access to technical assistance
Access to capital

- Regulatory and programmatic requirements associated with multiple funding sources
- Access to technical assistance
- Access to capital

- RD 515 Preservation Demonstration

## Five percent Set-aside of the available 9% Low Income Housing Tax Credits
2009 and 2010 funding rounds
To be used with a PRLF loan
To preserve between six and eight Section 515 projects

- 2009 and 2010 funding rounds
- To be used with a PRLF loan
- To preserve between six and eight Section 515 projects

- RD 515 Preservation Demonstration

## A development team or teams will be selected to participate based on interest, commitment and experience
Team will not enter the competitive 9% LIHTC round

- Team will not enter the competitive 9% LIHTC round

- RD 515 Preservation Demonstration

## Following a period of technical assistance provided by IFA and USDA-RD, when the project(s) are ready to proceed, the project(s) will be guaranteed the 9% LIHTC and PRLF loan funds

- RD 515 Preservation Demonstration

## Identify potential 515 properties
Feasibility analysis: existing and proposed ownership, market need, site characteristics, building condition
Energy Audit
Capital Needs Assessment
Market Study
Financial Analysis

- Feasibility analysis: existing and proposed ownership, market need, site characteristics, building condition
- Energy Audit
- Capital Needs Assessment
- Market Study
- Financial Analysis

- RD 515 Preservation Demonstration

## Prior to award of tax credits
Must meet all of the Qualified Allocation Plan threshold requirements, as well as those additional requirements of the PRLF demonstration loan program based on an individualized in-depth analysis of each program

- Must meet all of the Qualified Allocation Plan threshold requirements, as well as those additional requirements of the PRLF demonstration loan program based on an individualized in-depth analysis of each program

- RD 515 Preservation Demonstration

## Document the process and lessons learned so that information can be shared broadly with other housing finance agencies

- RD 515 Preservation Demonstration

## Contact Information

- Carla Pope, Director, Affordable Rental Production
- Dave Vaske, LIHTC Manager
- Craig Johnson, Underwriter
- _[www.iowafinanceauthority.gov](http://www.iowafinanceauthority.gov/)_
- _[Firstname.lastname@iowa.gov](mailto:Firstname.lastname@iowa.gov)_
- 515/725-4900

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