Low Income Housing Tax Credit Assistance Program (TCAP)


Many Low Income Housing Tax Credit (LIHTC) projects were not able to move toward construction because they needed “gap financing” since LIHTCs were not bringing in as much equity as they had in the past, or because the current economy diminished the demand for tax credits. 

ARRA created TCAP, using the HOME Program allocation formula. TCAP will provide grants to state tax credit allocating agencies (generally Housing Finance Agencies, HFAs) for capital investments in LIHTC projects.  HFAs must award funds competitively, based on their QAPs (Qualified Allocation Plans).  ARRA provided $2.25 billion for TCAP.

Only projects that have LIHTC awards from FY2007, FY2008, or FY2009 are eligible. TCAP-assisted projects will follow LIHTC rules regarding tax credit rents charged, income eligibility, and affordability use restrictions. ARRA requires that priority be given to projects that can be completed by February, 2012.  75% of a state’s TCAP funds must be committed by February 2010, 75% must be spent by February 2011, and all of it spent by February 2012.

Key, non-technical features of HUD’s initial guidance implementing TCAP (Notice CPD-09-03) include:

  • State tax credit agencies must submit their TCAP applications to HUD by June 4, 2009.
  • The "application" must describe all project selection criteria and any weights used to award TCAP funds.
  • The project selection process and criteria must be made available to the public (posted on an agency website), and the agency must accept public comments for at least five days.
  • Agencies’ websites must identify all projects selected for funding and the amount awarded to each project.
  • HUD does not require agencies to amend their QAPs (Qualified Allocation Plans).
  • HOME regs and ConPlan regs do not apply.

HUD’s TCAP webpage, http://portal.hud.gov/portal/page?_pageid=153,7973386&_dad=portal&_schema=PORTAL

National Housing Trust

Citizens' Housing and Planning Association
 http://www.chapa.org/
Novogradac & Company, a national consulting firm that works in the fields of affordable housing, community development, and renewable energy maintains a TCAP website, www.novoco.com/low_income_housing/news/hot_topics/recovery.php

Fair Housing

TCAP Section of the ARRA Statute, http://www.nlihc.org/doc/TCAP-ARRA.pdf