Year 15 Preservation Program
HPD’s Low Income Housing Tax Credit Preservation (“Year 15”) Program was created to preserve the long-term affordability of City-assisted tax credit properties that are reaching the end of the initial 15-year tax credit compliance period In its mortgagee and regulatory roles, the City must approve the proposed new ownership and related repositioning for these projects. As part of the Year 15 tax credit investor exit review Year 15 assesses the needs of each project and, working with the Sponsor and Technical Assistance Provider, develops a repositioning strategy to address projects’ financial and capital needs
If an assessment of the project’s financial and physical conditions indicates that the project needs additional subsidy, the Year 15 Program can provide loans of up to $15,000 per residential unit. Loans are issued as 30-year repayable balloon mortgages with a 0% interest rate. All projects are expected to receive a full or partial 420-c tax exemption, and are required to have a tax benefit in place at repositioning.
Projects must conform with all income, occupancy and rent restrictions outlined in current HPD and any supplemental regulatory agreements, including restrictions outlined for tax credit projects in IRS Section 42. Sponsors must agree to extend the affordability period through the later of (i) the term of the any additional mortgage provided, or (ii) 15 additional years from the current restriction period. Projects with pre-1990 tax credits must agree to extend the affordability levels required during the initial tax credit restriction period. Projects are required to maintain their initial homeless set aside requirement.
City-assisted tax credit properties at the end of their initial tax credit compliance period developed through the agency’s disposition or homeless housing development programs are eligible for repositioning through the Year 15 Program.
The Year 15 Program works with a designated set of projects each year. Projects interested in repositioning an eligible project should reach out to LISC or Enterprise, the syndicator who will function as a Technical Assistance Provider, to discuss a repositioning strategy and complete the Year 15 repositioning application. Projects who syndicator was not LISC or Enterprise should reach out to HPD directly.
For more information about eligibility and terms, please download the Year 15 Program Term Sheet here or contact Andrew Cohen, Program Director at the number below. Information on how to contact LISC or Enterprise for applications for repositioning can be provided at the same number.
Phone Number: (212)-863-6424