The Maryland Department of Housing and Community Development has released a Notice that it has sent both its QAP and Multifamily Rental Financing Program Guide (the “Guide”) to Governor Hogan for approval. DHCD’s website contains copies of redline and clean versions of several draft iterations of each document from February onwards.

Some of the significant changes include:

  • Generally, more points and flexibility to encourage development in Communities of Opportunity. This includes:
    • 4.8.8.1 For family projects in Communities of Opportunity, acquisition costs may be up to 120% of as-is value for purposes of project financing, calculating developer fee, and other items (regularly these items are cut-off at 100% of as-is value).
    • 5.2.2 All family projects in Communities of Opportunity qualify for the state DDA 30% basis boost without need for prior CDA approval.
  • 4.3.3 Incentivizes higher bedroom counts. Points are available to projects with 60% of units with 2BR or more and points for projects with 20% of units at 3BR or more.
  • Point Deductions:
    • A reversion back to 2013 QAP language regarding deduction of points for going over the per square foot development cost caps. This change was made in July due to public comment. The per square foot caps range from $98 to $153 and depend on factors like building type and new construction versus rehabilitation. Points are deducted for exceeding the caps.
    • 5.1.2 Points will be deducted if a member of the project team has in the past increased construction costs after closing without DHCD’s approval.
  • 4.3.2 An updated Affirmatively Furthering Fair Housing marketing clause to conform with recent HUD updates.
  • 4.8.8.3 Targeting Populations at or below 20%AMI: Projects may request up to a 5% additional developer fee if the entire fee is escrowed with a lender to fund an internal rent subsidy for units set aside for populations at 20% AMI or below.

*Note: It may be helpful to review the earlier listed draft documents on the DHCD website as well as the proposed changes documents. Most recent published redline drafts contain mostly non-substantive typographical corrections.