Congressman Barney Frank (D-MA) recently issued a letter to U.S. Treasury Secretary Timothy Geithner requesting certain modifications to Treasury’s guidance regarding implementation of the low-income housing tax credit exchange program under Section 1602 of the American Recovery and Reinvestment Act (ARRA). In the letter, Rep. Frank recommends the following modifications to the Exchange program:
- Extend the final disbursement deadline from December 31, 2010 to December 31, 2011. Frank suggests that the deadline be modified to require that a certain percentage of funds must be disbursed by December 31, 2010, with a 2011 deadline for final disbursement of all funds.
- Allow funds to be allocated in the form of loans. Frank states that the statute makes no specific requirements that awards be in the form of grants, and recommends that loans be accepted.
- Allow more flexible recapture requirements. Frank suggests that a first lien to secure recapture creates problems with permanent lenders and recommends the use of more flexible provisions to address recapture requirements.
