TCAC intends to allow applicants in the first round of 2016 to claim DDA status if the project is located in an area that will be considered a DDA after June 30, 2016, provided that the carryover allocation occurs after June 30, which is TCAC’s normal practice. TCAC will only change this policy in the event that its interpretation is found to be incorrect.
For 9% tax credit applications located in areas that will lose DDA status on June 30, 2016, the TCAC regulations grandfather in DDA status for these projects for one year. As a result, TCAC will also allow such projects to claim DDA status in both first and second round 2016 applications. Likewise, TCAC will allow applicants submitting 4% tax credit applications at any time in 2016 to claim DDA status for projects located in areas that will be considered DDAs after June 30, 2016, provided that the bonds will be issued after June 30, 2016 and the building is placed in service after June 30, 2016.
The California Debt Limit Allocation Committee issued a notice starting that projects located in an area that was a DDA in 2015, but will lose its DDA status in 2016, are still eligible for the basis boost so long as the state agency receives the complete project application from the developer by June 30, 2016 and the project is placed in service or bond are issued within 730 days after the project submits a complete application.
All applicants should be aware that the new Small Area DDAs are not necessarily synonymous with ZIP codes but instead are designated by ZIP Code Tabulation Areas (ZCTAs). In order to confirm a project’s DDA status, applicants will need to use the following HUD website: www.huduser.gov/portal/sadda/sadda_qct.html.
