Code of Vermont Rules › Agency 11 - AGENCY OF COMMERCE AND COMMUNITY DEVELOPMENT › Sub-Agency 030 - DEPARTMENT OF ECONOMIC DEVELOPMENT › Chapter 003 - FEDERAL TAX CREDITS FOR LOW INCOME HOUSING; STATE ALLOCATION SYSTEM; JOINT COMMITTEE ON TAX CREDITS › Section 11 030 003 - FEDERAL TAX CREDITS FOR LOW INCOME HOUSING; STATE ALLOCATION SYSTEM; JOINT COMMITTEE ON TAX CREDITS

Current through June, 2024
Section I PURPOSE
The Federal Tax Reform Act of 1986 created a new federal tax
				credit to stimulate the production and rehabilitation of housing for low income
				persons. The legislation (
				26 U.S.C. Section
				42 ) limited the allocation of tax credit
				authority to each state from 1986-89 to an annual sum equal to $ 1.25 per
				capita. Under this legislation, the state, acting through the Issuing
				Authority, the Vermont Housing Finance Agency, has allocated credits totalling
				approximately $ 1.48 million from 1987 through 1989.
The tax credit is determined as a percentage of certain
				qualifying project costs, relating to both the entire project and the units
				within a project that are dedicated for occupancy by low-income households. In
				the event that the owner fails to maintain the housing as a qualified project,
				there are provisions for recapture of sums taken as tax credits.
In 1989 Congress adopted an amendment to the legislation that
				limits the authority for 1990 to $ .9375 per capita. This amendment also
				requires the state to establish an Allocation Plan for allocating tax credits
				to qualifying rental properties, which must also meet specific eligibility
				criteria established by federal law.
On March 8, 1987, Governor Madeleine M. Kunin issued Executive
				Order # 42, which designates the State Agency of Development and Community
				Affairs as the State Housing Credit Agency. On July 16, 1987 the Governor
				signed Executive Order # 42A, which authorizes the Vermont Housing Finance
				Agency and the Agency of Development and Community Affairs to make low income
				housing credit allocations. These Rules implement Executive Orders # 42 and
				42A.
Section II DEFINITIONS
1. "Allocation Plan" means the qualified
			 allocation plan required by Section
			 42(m)(1)(B),
			 as amended.
2. "Code" means the
			 Federal Internal Revenue Code of 1986, as amended from time-to-time.
3. "Credit Year" means the calendar year. The
			 first credit year for the Low Income Housing Tax Credit Program commenced on
			 January 1, 1987.
4. "Eligible
			 Basis" means "eligible basis" as that term is used in Section
			 42(d)
			 of the Code, determined in accordance with Federal law.
5. "Issuing Authority" means, for so long as
			 the Memorandum of Understanding is in effect, the Vermont Housing Finance
			 Agency or, after termination of the Memorandum of Understanding, any other
			 entity designated by statute or further order of the Governor.
6. "Joint Committee on Tax Credits" or "Joint
			 Committee" means the committee established by Executive Order # 42, dated March
			 8, 1987, to develop policies for state allocation of low income housing tax
			 credit authority.
7. "Memorandum of
			 Understanding" means the Memorandum of Understanding between the State Housing
			 Credit Agency and Vermont Housing Finance Agency dated April 17, 1987, in which
			 Vermont Housing Finance Agency consents to serve as the Issuing Authority and
			 pertaining to the division of responsibilities between the State Housing Credit
			 Agency and the Issuing Authority, as the same may be amended from time-to-time
			 not inconsistently with these regulations.
8. "Program" or "Low Income Housing Tax
			 Credit Program" means the public housing program established by Executive
			 Orders # 42 and 42A and these regulations.
9. "Public Housing Program" as that term is
			 used in
			 3 V.S.A. Section
			 2472, includes, without limitation, the state
			 system for allocation of low income housing tax credits established by
			 Executive Orders # 42 and 42A and these regulations.
10. "Qualified Basis" means "qualified basis"
			 as that term is used in Section
			 42(c)
			 of the Code, determined in accordance with Federal law.
11. "Qualified Low Income Housing Project"
			 means projects for residential rental property meeting the requirements of
			 Section
			 42(g)
			 of the Code.
12. "Qualified
			 Non-Profit Organization" means an organization described in Sections 501(c)(3)
			 or (4) of the Code exempt from tax under Section 501(a) of the Code, which
			 organization has as one of its exempt purposes the fostering of low-income
			 housing.
13. "Recipient" means the
			 person or entity to whom a low income housing tax credit is issued by the
			 Issuing Authority, the beneficial owners of any such entity, and its and their
			 successors and assigns.
14. "State
			 Housing Credit Agency" means the Vermont Agency of Development and Community
			 Affairs (3 V.S.A. Chapter 47).
15.
			 "State Housing Policy" means such written documents representing the policies
			 of state government with respect to housing needs and allocation of resources
			 as may be promulgated from time-to-time by the Department of Housing and
			 Community Affairs, consistent with
			 3 V.S.A. Section
			 2472.
16. "Sunset Date" means that date beyond
			 which low income housing tax credits cease to be authorized under the Code, as
			 the same may be amended from time-to-time.