Texas Register, Volume 46, Number 38, Pages 5983-6306, September 17, 2021 Page: 6,082
5985-6306 p. ; 28 cm.View a full description of this periodical.
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the requirements of either subparagraphs (A), (B), or (C) of this para-
graph.
(A) HUB. The ownership structure contains a HUB cer-
tified by the Texas Comptroller of Public Accounts by the Full Appli-
cation Delivery Date. The HUB must have some combination of own-
ership interest in each of the General Partner of the Applicant, Cash
Flow from operations, and Developer Fee which taken together equal
at least 50% and no less than 5% for any category. For HUD 202 Reha-
bilitation projects which prohibit for-profit ownership, ownership will
not be required for a HUB, only for Cash Flow or Developer Fee; the
total ownership percentage must still equal 50%, even if it is only at-
tributable to one of the two categories. Any Application that includes
a HUB must include a narrative description of the HUB's experience
directly related to the housing industry.
(i) The HUB must materially participate in the De-
velopment and operation of the Development throughout the Compli-
ance Period and must have experience directly related to the housing
industry, which may include experience with property management,
construction, development, financing, or compliance. Material partici-
pation means that the HUB is regularly, continuously, and substantially
involved in providing services integral to the Development Team; pro-
viding services as an independent contractor is not sufficient.
(ii) A Principal of the HUB cannot be a Related
Party to or Affiliate, including the spouse, of any other Principal of
the Applicant, Developer or Guarantor (excluding another Principal
of said HUB or Qualified Nonprofit Organization). (2 points).
(iii) The HUB must be involved with the Develop-
ment Services or in the provision of on-site tenant services during the
Development's Affordability Period. A Principal of the HUB or non-
profit Organization cannot be a Related Party to or Affiliate, including
the spouse of, any other Principal of the Applicant, Developer or Guar-
antor (excluding another Principal of said HUB or Nonprofit Organi-
zation). (1 point).
(B) Qualified Nonprofit Organization. The ownership
structure contains a Qualified Nonprofit Organization provided the Ap-
plication is submitted in the Nonprofit Set-Aside. The Qualified Non-
profit Organization must have some combination of ownership interest
in the General Partner of the Applicant, Cash Flow from operations,
and Developer Fee which taken together equal at least 50%, and no
less than 5% for any category. For HUD 202 Rehabilitation projects
which prohibit for-profit ownership, ownership will not be required for
a nonprofit, only for Cash Flow or Developer Fee; the total ownership
percentage must still equal 50%, even if it is only attributable to one of
the two categories.
(i) The Qualified Nonprofit Organization must ma-
terially participate in the Development and operation of the Develop-
ment throughout the Compliance Period and must have experience di-
rectly related to the housing industry, which may include experience
with property management, construction, development, financing, or
compliance. Material participation means that the Qualified Nonprofit
Organization is regularly, continuously, and substantially involved in
providing services integral to the Development Team; providing ser-
vices as an independent contractor is not sufficient.
(ii) A Principal of the Qualified Nonprofit Organi-
zation cannot be a Related Party to or Affiliate, including the spouse,
of any other Principal of the Applicant, Developer, or Guarantor (ex-
cluding another Principal of said Qualified Nonprofit Organization). (2
points).
(iii) The Qualified Nonprofit Organization must be
involved with the Development Services or in the provision of on-sitetenant services during the Development's Affordability Period. A Prin-
cipal of the Qualified Nonprofit Organization cannot be a Related Party
to or Affiliate, including the spouse of, any other Principal of the Ap-
plicant, Developer, or Guarantor (excluding another Principal of said
Qualified Nonprofit Organization). (1 point).
(C) Nonprofit Organization. The ownership structure
contains a nonprofit organization that meets the requirements of IRC
42(h)(5)(C) on the Application Delivery Date, with at least 51% own-
ership in the General Partner of the Applicant. (2 points)
(i) The nonprofit organization must maintain Con-
trol of the Development and materially participate in the operation of
the Development throughout the Compliance Period;
(ii) The nonprofit organization, or individuals with
Control of the nonprofit organization, must provide verifiable docu-
mentation of at least 10 years' experience in the continuous operation
of a Development that provides services similar to those in the pro-
posed Development; and
(iii) The Applicant will provide a minimum of 3 ad-
ditional points under 10 TAC 11.101(7) related to Resident Supportive
Services, in addition to points selected under 10 TAC 11.9(c)(3).
(c) Criteria to serve and support Texans most in need.
(1) Income Levels of Residents. ( 2306.111(g)(3)(B) and
(E); 2306.6710(b)(1)(C) and (e); and 42 (m)(1)(B)(ii)(I)) An Appli-
cation may qualify for up to sixteen (16) points for rent and income
restricting a Development for the entire Affordability Period at the lev-
els identified in subparagraph (A), (B), (C), or (D) of this paragraph.
(A) For any Development located within a non-Rural
Area of the Dallas, Fort Worth, Houston, San Antonio, or Austin
MSAs that propose to use either the 20-50 or 40-60 election under
42(g)(1)(A) or 42(g)(1)(B) of the Code, respectively:
(i) At least 60% of all Low-Income Units at 50% or
less of AMGI in a Supportive Housing Development proposed by a
Qualified Nonprofit (16 points);
(ii) At least 40 % of all Low-Income Units at 50%
or less of AMGI (15 points);
(iii) At least 30% of all Low-Income Units at 50%
or less of AMGI (13 points); or
(iv) At least 20% of all Low-Income Units at 50 %or
less of AMGI (11 points).
(B) For Developments proposed to be located in areas
other than those listed in subparagraph (A) of this paragraph and that
propose to use either the 20-50 or 40-60 election under 42(g)(1)(A)
or 42(g)(1)(B) of the Code, respectively:
(i) At least 60% of all Low-Income Units at 50% or
less of AMGI in a Supportive Housing Development proposed by a
Qualified Nonprofit (16 points);
(ii) At least 20% of all Low-Income Units at 50% or
less of AMGI (15 points);
(iii) At least 15% of all Low-Income Units at 50%
or less of AMGI (13 points); or
(iv) At least 10% of all Low-Income Units at 50%
or less of AMGI (11 points).
(C) For any Development located within a non-Rural
Area of the Dallas, Fort Worth, Houston, San Antonio, or Austin MSAs
that propose to use the Average Income election under 42(g)(1)(C) of
the Code:46 TexReg 6082 September 17, 2021 Texas Register
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Texas. Secretary of State. Texas Register, Volume 46, Number 38, Pages 5983-6306, September 17, 2021, periodical, September 17, 2021; Austin, Texas. (https://texashistory.unt.edu/ark:/67531/metapth1385246/m1/100/: accessed July 17, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu.; crediting UNT Libraries Government Documents Department.