Low IncomeHousing Tax Credits and Qualified Allocation Plans QAPs

The federal Low-Income Housing Tax Credit (LIHTC) program is one the main financial drivers of affordable rental housing. Although a federal program, the tax credits are allocated at the state level through the QAP. In many states, the tax credits are a staple in the financial structure of affordable housing. Because of the competitive nature of tax credits in many states, the LIHTC via green criteria in state QAPs is one of the most significant tools for increasing the level of green building that is expected of all tax credit-financed affordable developments. The fifteen-year compliance period of tax credit projects also helps to ensure that the projects, including the green features, are well maintained. For these reasons, the green building criteria in state qualified allocation plans (QAPs) are an integral ingredient in encouraging the development of green affordable housing.

In 2005, Global Green USA released the report Making Affordable Housing Truly Affordable: Advancing Tax Credit Incentives for Qreen Building and Healthier Communities.1 This analysis of QAPs from fifty states identified that an increasing number of states—including California, Georgia, and New Jersey—are incorporating green criteria in their QAPs, although in differing ways. Some states are focused on smart-growth measures such as promoting infill development or locating projects close to public transportation. Other states have highlighted energy efficiency or established criteria related to locating developments specified distances from factories or other noxious land uses.

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