Bye-bye. Okay, welcome back everyone. I just wanted to say hello again. Thank you for joining on a very topical issue. Is it construction tax credits, historical and low income? We have three amazing industry experts that are going to join us for this presentation today. I'm going to introduce them, not necessarily in their mode of presenting, but one of our presenters is Nicholas Ratty, is a principal with Cone Resnick's Real Estate Consulting Practice in Boston, Massachusetts. With more than 15 years of experience in tax credit industry, Nick is currently responsible for developing and evaluating tax credit syndicate structures, providing tax compliance advice, evaluating tax credit recapture or tax loss reallocation issues, strategizing post-compliance period exits and providing syndication advisory services. He has extensive experience structuring a wide range of historic low income and new markets tax credit transactions for developers and investors. We also have Kathleen Galvin, is a project manager with NTCIC. As a project manager, Kathleen manages the closing process for historic tax credit and new markets tax credit investments. Kathleen has been with NTCIC for eight years, originally joining the team as an asset manager. Prior to this, she served as a real estate development manager for a financial advisory firm. In this role, Kathleen managed the commercial and residential real estate portfolio and collaborated with urban planners, researchers, builders, and other professionals during the development stage of mixed use real estate developments in the states of Texas and Louisiana. She holds an MBA from the McCombs School of Business, focusing on real estate from the University of Texas. Hook them horns, might as well say it. And also we have with us Tom Lipford. He is a business development specialist with Great American Insurance Group. Tom holds an associate in the Marine Insurance Management and Construction Risk and Insurance Specialist designations. Tom has extensive experience in both marketing and underwriting. And before I turn it over to Kathleen, I just wanna mention a little bit different. This session, I will be holding the questions until each presenter has finished their section. We will answer a couple of the questions then. And just so we make sure everybody gets their turn, any additional questions we will pause at the end and ask. So without further ado then, I will turn this over to Kathleen. Thank you. Let's see, let me see if I can get control of. Here we go. So I'm gonna kick off the session talking about historic tax credits and kind of how they work and a little bit about their use and also risks and mitigants. We're also going to, then Nick will take over and talk about low-income housing tax credits, also known as LIHTC. And similarly kind of walk through the logistics of those tax credits. And then finally, Tom will go do the deep dive into how the tax credits relate to builder's risk. So we'll start with the HTC Basics. The federal program began in 1976 and became permanent in 1986. It is, there are several types of, or a couple of types of historic tax credits, both federal and state tax credits. The federal credit is a standard 20% of rehabilitation cost and the state credits vary by state, either by percentage or by type. By percentage, a lot of the rules, how the tax credits can be transferred and things like that. For the purposes of this presentation, I'm gonna focus on the federal tax credits and understanding how they work. The preservation aspects of these credits will be administered by, first the State Historic Preservation Offices and then the National Park Service. We also call it NPS. So you might hear me refer to NPS throughout the presentation. The tax aspects of the HTCs are administered by the IRS. And what that means is when you try and claim these credits on your tax return, the IRS is the one that will evaluate those credits and whether or not you're able to take them. So as I mentioned, this is a 20% credit. Originally, it was a one-year credit, which means that when the building was placed in service and you qualified for the credit, you were able to take that credit that year. It is now, after it's placed in service, the investor will take it over five years. So that was, I'm not sure exactly the year that that changed, but the credit is earned by, as I mentioned, something called Qualified Rehabilitation Expenditures, and I'll kind of go into what that means and what the, you know, how those are determined. So how the HTCs work. A building, first you have to make sure that you're eligible to receive the credit. So the building must be what's called a Certified Historic Structure, and what that means is that it's individually listed on the National Register, or it's a contributing building in the National Register Historic District. Now this is determined by the National Park Service, and I'll go into a little bit about how that application process works in the next few slides. The project also needs to be a Certified Rehabilitation, and what that means is it needs to adhere to the Secretary of the Interior's Standards for Historic Rehabilitation. Now there are certain standards of construction that the developer will need to follow in order to abide by these standards, and so it's really important that you get a team of people that really understand or have done tax credits in the past. Usually there's a historic consultant that will write the historic applications that are submitted to the NPS, and they kind of review and will advise on what these standards would require and things like that. So you really want to get and make sure that there's an experienced team in place. The things with these standards are something, you know, there's multiple, but an example would be that if you're replacing something in the building, it needs to be the same materials, it needs to look visually congruent and things like that with the historic structure. So usually you will want to have an advisor or know that the team has an advisor that will be able to work them through that process. The property also needs to be income-producing, so it can't be something that an individual lives in. It needs to be rented to tenants and things like that where the actual real estate will be producing income. The other thing is that it needs to be a substantial rehabilitation, and what that means is it needs to be more than $5,000 or the adjusted basis of the building. This test must be met within two years. I'll go into adjusted basis in the next slide. So the adjusted basis calculation is basically the purchase price of the property, the building and land, minus the cost of the land at the time of purchase, minus depreciation over for an income-producing property, and then you add back the cost of any capital improvements made since the initial purchase. Let's see, this is not popped up, oh, there we go. Okay, so a little bit about the NPS. Again, that's the National Park Service application process. So again, to qualify, you need to show that it is, it was a part one application, show that the significance and appearance of the building. You know, you would talk about why this building is important to be saved, why, how it contributes to the history potentially of the area, or if there's something important that happened at that building. The part two application can either be submitted after or at the same time as the part one application. And this will describe the condition of the building in its current state and also all of the rehabilitation work that will be done over construction period. It will, again, as I mentioned earlier, the work needs to be based upon the Secretary of the Interior's standards for rehabilitation. So you really wanna outline not only what is gonna be changed, but also materials that are gonna be used and things like that. The NPS is particularly sensitive about certain items, usually, you know, windows, doors, exteriors of building, even signage, things like that that would point to the historic nature of the building. So you really wanna make sure that you get someone who can really speak to all of the things that will be changing and also how the building will be preserved. After that time, when the construction is complete or near completion, they submit a part three application. And what that application shows is that all of the work that you said that you were gonna do in the part two application actually was done and kind of reviews the status and the completed project. And usually they submit pictures and things like that to show that they built it in adherence with the part two application that was approved. So at the part two stage, going back to that, the NPS can either approve it outright and say that the part two application is approved, you can go ahead and move forward with everything that you submitted. Sometimes they have conditions. So for instance, if there's a particular wall within the project, if there's signage, things like that, they will use that as a condition. You really wanna make sure if they had any conditions on your part two application that you completed those conditions in order to receive approval for your part three application. And when you receive the part three application, that's when you know that the HCC credits will be awarded. As I mentioned earlier, the application process starts with the Historic Preservation Office. And once they approve that, they pass that on with recommendations to NPS. So typically it takes within about 30 to 60 days to get the approvals. And you wanna make sure that your project submits the part two before embarking on any demolition work. You don't want them to tear down signage that was important that may not qualify you. You may not, you know, certain walls or fixtures on the interior. You wanna make sure that until you receive the part two approvals that you can move forward with that work. So I mentioned Qualified Rehabilitation Expenditures. What that is are the expenditures on which the tax credit is calculated. So as I mentioned, it's 20% of these Qualified Rehabilitation Expenditures. Things that count are construction, electrical, plumbing, things like that, a lot of the hard costs to construct the building. Some soft costs are included like architectural fees, engineering fees, taxes, insurance, which is important in this case, and other management fees and things like that. Things that don't count would be the acquisition costs of the building, demolition costs, leasing expenses, and also non-historic construction or additional building. So for instance, if you or the developer created a storage unit that's brand new behind the building, that is not considered part of the Qualified Rehabilitation Expenditures. So as I mentioned, in order to calculate the HCC, it's the QREs times 20%. And many times, building owners can't use the credits themselves. They don't have enough tax liability to offset their taxes. So a lot of times, that's why we bring in investors. That's why they're important. Because usually, in order to utilize the benefits of the tax credit, usually these projects are a lot larger and will have a large tax credit number associated with it. So investors typically don't pay dollar for dollar. They usually pay a little bit less than a dollar for the credit. Again, it depends on, let's say, whether it's eligible to be a one-year credit. The five-year credit, obviously, because of the time value of money, is a little bit less valuable than the one-year credit, the size of the credit. And also things like whether or not a project is CRA. So a bank, for instance, would be interested in projects that have CRA credits as well as historic tax credits so that they can maximize their investments. The credits times the amount that the investors are willing to pay for those credits will be the HCC equity that goes into the project. So here's kind of just an outline of where the different parties fall in the structure. The sponsor, developer, and contractor, obviously, are the ones that are rehabilitating the building. Separately from that, you'll have your leases and tenants. Again, to reiterate, it needs to be an income-producing property. And then we have the tax credit investor. So I work for the National Trust Community Investment Corporation. We are a tax credit syndicator. And what that means is we kind of have a pool of investors that we pair with historic rehabilitation projects and provide financing, also helping with the structuring of the project and making sure that everything is done in accordance with the tax credit rules. We make sure in the closing process that all of the rules either are followed or there's documents that outline what needs to be done and make sure that the developer understands what they're responsible for over the five-year compliance period. So as I mentioned, many times investors come into the projects to contribute equity in exchange for their ability to claim the HCCs. There are a lot of different rules in terms of how much equity needs to be put in the project and things like that. So the investor generally must have at least 20% of their equity prior to placement service. So that means if we close before, during the construction period, we need to contribute 20% of our equity at the closing. We have tiered capital contributions that come in different stages of the project. And I'll go over that in a little while, but generally it's about 20% at closing. A larger chunk of the equity will come in once the project is operational, that's placed in service. And obviously that's because you wanted to make sure that we're eligible for the credits, that the project is actually completed. As we all know, that is an important factor in terms of timing and things like that. The timing of the placement service is particularly important for tax credits because it determines what year the investor is able to take those credits, which is meaningful for the tax planning of the investor, especially when they're larger credits. For instance, I closed a project that had $20 million in tax credits. So if the developer misses the placement service date by year, their tax planning department that was depending on those tax credits, has to fill that void in another way. And so the credits become potentially less valuable to the investor based on the year that it's placed in service. So we really wanna make sure that the project can be completed and completed in a timely manner. The investor must also receive a return over the life of the deal. And one of the reasons is because for the tax credits, unlike some of the state tax credits, they don't just purchase the credits, they have to be considered a partner in the transaction. So what that means is they need to have some of the upside and downside of being an investor in the project. So there is some construction risk, for instance, there is operational risk. So the investor, typically in our projects, receive between two and 3% of equity per year of the equity they contributed to that point over their five-year compliance period. The investor at the end of the compliance period usually has what's called a PIT option. And it's usually priced at about 5% of the equity that they put into the project. And that would occur only after the compliance period is over. There's a five-year compliance period for historic tax credits. So after the year placed in service, so five years from the time that the project is placed in service, the investor can then exit the transaction. So as I mentioned, the typical pay and schedule is about 25% to 30% at closing, 45% to 55% at placement and service, 10% to 15% when they receive their NPS Part III. As I mentioned earlier, that is when the project knows that they qualify, that the National Park Service has approved the project to be eligible for the tax credit. And then 5% to 10% at stabilization. And that is when the income producing property reaches a certain debt-to-risk coverage benchmark. And that way we know that we'll get the return that we're expecting as a legitimate partner and investor. During the five-year compliance period is, again, this is the period when the credits are subject to recapture. So if anything violates the tax credit rules, these tax credits could potentially be recaptured, which means that the investor would not be able to claim them. They can't make all physical alterations to the building. They cannot transfer ownership to a new owner. And so that's important in terms of, let's say the building is foreclosed on, you wanna have mechanisms in place to make sure that the ownership structure stays in place. And one thing of note is the recapture amount decreases by 20% each year. That means, let's say, and it's not until year two that there's a violation of these rules, the investor will still be able to claim 20% of those credits, but they will lose their ability to claim the remaining 80% of those credits. It looks like we're running out of time, so I won't go too far into this. This is a typical HTC structure, and this structure has been in place in order to preserve and mitigate some of the tax credit transaction rules to make sure, for instance, that the ownership structure stays in place. It also allows the project to manage the flow of cash flow depreciation and other types of things, and the allocation of the HTC equity and things like that. As you can see, the HTC set tenant is the level at which a lot of the activity will happen, so where the rent is collected from the individual tenants, where a lot of the expenses are paid for utilities and things like that, and the tenant will then pay a set lease with potentially upward adjuster to what's called the HTC landlord. The landlord is the one that technically is the owner of the property, so that's usually the level in your circumstance where the insurance will be held and things like that, so those expenses will potentially be paid on behalf of the landlord at the tenant level. The landlord usually is the entity that holds the insurance. As I mentioned, in order to mitigate some of these risks, the project puts certain things into place, such as the SNDA. We have certain underwriting, things that we look at, such as the guarantor strength. We have a lot of reserves in place to make sure that the project can continue to be placed in service and doesn't, for instance, become at risk for foreclosure, which would then potentially put the ownership structure at risk. Then also, we look at to make sure that there's an experienced team in place that knows how to structure these deals and understands the nuances of the credits. These credits can be paired with other credits, such as a new market tax credit, CPASE, LIHTC. There can be both federal historic and state historic credits on the same deal, things like that. They bring a lot of mixed use and commercial valuations to a lot of areas, and also can be used as an economic recovery tool, so it goes in recovery. For instance, it was a big thing after Hurricane Katrina, so we were able to enhance the credits after disaster instances like that. I will run through some of the risks and mitigants that I mentioned, of risk that we see in the transaction. As I mentioned before, there's a structure risk, which is why you want to have indicators like us and also experienced accountants and attorneys to structure the transaction to create the most mitigants to violating any of the tax credit rules. One thing is by getting within the REVPROC safe harbor. What that means is if you follow certain rules that the IRS set out, you are protected from getting audited in terms of your structure and the way that your investors come in the transaction. We also have reasonablest opinions that are provided by the accountants to say the fees and other aspects of the deal are reasonable. Then also, we have the review of the structure to make sure that it is in line with all of the tax credit uses. We also obviously have construction completion risk that makes sure that the building is actually placed in service, and again, placed in service in the year that we expect it to be placed in service. Obviously, you would look at the development team experience, that they've done this before, that they've built historic buildings before. The nuances with historic buildings, as we'll talk about again later, is that if something happens to a building, let's say that a portion of it is burned, you need to redevelop that part of the building with a similar craftsmanship and materials that were used in the original building. You can't just put up regular sheetrock and things like that. You actually have to have, in order to continue to qualify for the tax credits, you have to replace those areas with the same craftsmanship and materials. That can get expensive. We also have the consultants in place that review the construction plans, the cost, and see if the timeline is reasonable, if the costs are reasonable, and obviously, the guarantor strength that they can step in if there are overruns in construction budget and things like that, that the guarantor will be able to complete the building, which again, needs to occur in order for the tax credit to be claimed. There's also the credit delivery risk. Again, this is going over things that I discussed earlier in terms of if the project is not built in the way that the approved Part 2 has indicated, then there is risk that the credit cannot be claimed because they will not receive a completed Part 3. That can also get expensive if they did not get something approved. Let's say they replaced all the doors with something very modern. The NPS comes back and says, you're not going to get your Part 3 unless these are brought back to the historic doors, things like that. The developer will need to go back and replace those items in order to receive their Part 3. Again, there's also the risk of the placement service delay, and also if the building goes above or below budget, the QREs will also be affected. Let's say that it was a lot cheaper to place this in service than expected, there'll be fewer tax credits available to the project. We want to make sure that the budget is reasonable before embarking the project. Finally, we have the recapture risk that I discussed earlier. You want to make sure that the ownership needs to stay in place. You want to make sure that the termination of the master lease does not occur. We do things like that by putting in place subordination non-disturbance agreements, which means that the lender agrees not to disturb the master lease structure, even if they foreclose on the property. Also, any material alterations of the building. There's a lot of things in place in the documents that the developer will indicate that they will not change the building after we receive the Part 3 without the approval of the investor and the National Park Service, for instance, so that we don't violate or get these credits recaptured at a later date during the five-year compliance period. After the five-year compliance period, there can be work done and you're no longer at risk of losing the credits. Also, obviously, and most important in this instance, is the risk of casualty and getting the appropriate insurance in place for the historic building. Again, the building needs, if there was a fire, a flood, something like that, you need to have insurance in place that will be able to replace the project in the same craftsmanship materials and manner that it was at historically, so that the Part 3 at that time or the historic nature of the building stays in compliance during that five-year period. So, that is the end. Hopefully, I didn't go too far over. I'm happy to answer any questions. Thank you, Kathleen. So far, we don't have anything popping up, which is not unusual. They'll probably start rolling in later. So, if we want to just transfer and keep right on, go up. Hold on. Here we go. First question just came in. Let me just see here. Builders risk insurance carrier wants to cover third-party financial. Okay, let me slow down. Carrier wants to cover a third-party financial agreement with an investor. Given that the insurer has no say control over the terms of this agreement, this sounds more appropriate for financial liability insurance. Not to mention, I believe that insuring these tax credits are insuring a speculative risk, not a pure risk, in which there is only a chance of this happening. So, I think actually that's probably more of a statement, and I think maybe we could hold off on that till the end. Kathleen, do you agree? I'm sorry, I was on mute. Absolutely. I think that Tom might have more experience on the underwriting aspect of the transaction, so he'd be able to speak to that better than I can. Okay, good. And we had one more. Can we get a high-level example with cost dollars for a HTC project? So, the projects are all over the map. They can be from a small project to an extremely large project. For instance, a project that I closed a couple of years ago was $200 million in rehabilitation expenditures, whereas I closed a theater just last year that was about $40 million. So, it's all over the map, and so it's hard to determine what. And also, and I think that Tom can also speak to this as well, there's product types such as a building, for instance, that is more of a corn shell, and there's fewer things on the interior of the building that a builder needs to adhere to, versus if you think of something like a historic theater, that might have scaffolding on the roof or the ceiling of various parts of the building. They might have a lot more elaborate interior details that the developer will need to adhere to. So, again, it's really important to look potentially at their Part 2 application and also the cost of the rehabilitation to understand, once those costs are certified, to understand what it would be to replace aspects of historic buildings. In some instances, it is a shell. So, I did one that was an old post office, and it was basically concrete and concrete walls on the interior. So, it's a lot different to replace a portion of that building that would get damaged versus something that had artwork on the ceilings and reliefs and things like that. So, you really want to be, this is more than anything else, a project-by-project evaluation of the replacement. Okay. All right. Thank you. Good. So, we have nothing else. So, if you want to turn it over, I guess, to Nick, we can keep on rolling. Thank you, Kathleen. Great. Thank you. Good afternoon, everyone. I'm Nick Braddy with Conrad's Neck. I'm going to be doing a overview of the Low-Income Housing Tax Credit Program. It's going to be a high-level overview. There are multi-day conferences that go through all the intricacies of the Low-Income Housing Tax Credit Program. I'm going to provide you with kind of a high-level overview to give you some of the basics you need to understand the program. Section 42 of the Internal Revenue Code is the section that administers the program. It's the longest section of the Internal Revenue Code, so there's a lot there to go through. Again, I'm going to try to give you some of the important aspects of the program, how the program was used to produce and preserve affordable housing, and some of the benefits of investing in Low-Income Housing Tax Credits and some of the risks associated with it. As I mentioned, it's a subsidy program for the production and preservation of affordable rental housing. It was created as part of the Tax Reform Act of 1986 and has been modified several times over the years to be what it is today. Each state has a housing finance agency that oversees the program for that particular state. They make sure, are in charge of allocating the credit to developers, and we'll go into that process a little bit more. The objective of the program is to bring private equity into these projects that have restricted rent and a limited ability to support part debt on the project, which then has a need to fill the gap between the cost of constructing these assets versus the amount of debt that they can support and the equity returns from a straight cash return standpoint. So basically these tax credits that are available to the owners of these projects help provide an added boost in the equity, the cash return, because credits are a cash equivalent to investors in these projects. And the eligibility of each of these projects is based on the limitations that are put on where the tenants that will be occupying those buildings. So the tax credits are first allocated to each of the states based on the population of those states. And for the 9% tax credit, those credits are allocated based on $2.81 per person to each state with a small state minimum of $3,245,000. And those are numbers from 2021. And then also if you have a project that is financed using taxes and bonds, you are eligible for a lower credit of 4%. And those credits are essentially capped by the amount of taxes and taxes and bond volume cap each state is allocated each year. So in 2021, each state received the greater of $110 per person or $324.9 million of taxes and bond authority. So once the federal government has allocated these credits to each state, the owner or sponsor of the low income housing tax credit project applies to the state for a reservation of credits. Now, as I briefly mentioned before, there's two types of credits that are available, two types of low income housing tax credits. There's a 9% credit and the 4% credit. The 9% credit is the percentage of credit that is allowable annually on your qualified costs. So for instance, if you have a $10 million project with $10 million of eligible costs and you are awarded 9% credits, you'd be eligible, a project would be eligible for $900,000 of credits per year for 10 years. So a total of $9 million worth of credits. Now, the point of that 9% credit has how they came up with that, the agency, the Internal Revenue Code and Treasury originally came up with that 9% rate was back when the program was initially started, it was meant to establish a percentage that would allow the project on a present value basis. So you take that allocation of credit over a 10 year period, present value it. And the present value of that 10% of that 10 year stream of credit should approximate 70% of the eligible project costs. So 70% of the capital stack is financed through these credits, 30% would have to come through some type of debt product or soft loans from the state agency. The 9% credit, because they provide such a large percentage of the capital stack, it's highly competitive. Many states have a waiting list, you have to, it's a competitive application process to receive those credits. And it may take multiple rounds of applying to the state for those credits to be awarded. The 4% credit is an as of right credit that is available to owners or sponsors of projects that are financing their project with taxes and bonds. 10 years ago, it used to be fairly easy to receive an allocation of taxes and bonds. Many states weren't using all of their taxes and bond authority each year. That's changed in the recent years. It's become a lot more competitive to get those taxes and bonds, which also trigger that 4% tax credit. And so, although it's not quite as competitive as the 9% credit, it is still competitive. It can take some time to actually be awarded those credits. The calculation of the credit is similar to the 9%, except for you substitute out 4% for 9%. So a $10 million project would produce 4% of, or $400,000 of credits per year for 10 years. So for a total of $4 million of credits on a present value basis that back when the project originally started, that would have been approximately, and using discount rates from back then, that would have approximated 30% of the project cost. So the investment process. This is the slide where you can follow the tax credits basically from the upper left corner to the right, and the money that those credits generate from the right to the left in the bottom left-hand corner where the project is. So walking you through that, as I mentioned previously, the tax credits start with the federal government. They're first allocated to each state based on the per capita limits that I mentioned. The state is then given the authority to allocate those tax credits to projects within their state. Once those owners or sponsors of those tax credit projects receive their allocation of tax credits, they go out and find an investor or syndicator similar to National Trust, as Kathleen mentioned on the historic side. The local housing tax credit industry has many syndicators and direct investors whereby they will invest in limited partnerships in which these projects are owned and generate the credits. And in exchange for the allocation of these tax credits that the project produces will contribute equity to the partnership, which the owners and sponsors can use to fund the production and construction of their low-income housing tax credit projects. So the next slide is just kind of a typical LIHTC investment structure. Starting from the top, this ownership structure represents a low-income housing tax credit fund or syndication fund. There are two types of funds. There might be a proprietary fund that has a single investor or a multiple investor fund, which is just that has multiple investors and with a single syndicator GP. That fund goes out and finds lower tier projects to invest in. So the fund accumulates the dollars from its investors, finds the projects that are eligible for the low-income housing tax credits, invests in those limited partnerships and receives the allocation of tax credits, which ultimately flow to the local housing tax credit fund. The allocation of tax credits, which ultimately flow to the fund and flow to the investors in that fund to provide the return. All of these structures are set up as limited partnerships, flow through entities, and ultimately the tax credits flow up through pass-through entities like limited partnerships or LLCs until they hit a taxpayer. And typically the investors in these tax credits are corporate investors. There's rules that make it difficult for individuals to benefit from the low-income housing tax credits. They're subject to passive activity rules, which can limit the type of individuals that can utilize the credits and the amount of credit those individuals can ultimately use against their tax liability. That's why we see primarily corporate investors in this world. Occasionally on smaller projects, we may see an individual invest or in certain circumstances, we may see a developer sponsor who owns a smaller project, keep the credits and use it against their own liability. As a real estate professional is a type of taxpayer that can most easily benefit from these types of tax credits. So why do corporations invest in these tax credits? The main reason or one of the major driving factors for bank investments in this space is the Community Reinvestment Act, which mandates that banks reinvest a certain percentage of their dollars from a regulatory standpoint in areas in which they collect deposits. So these investments in low-income housing tax credit projects give them credit against their Community Reinvestment Act requirements for regulatory purposes. Another reason is it's just a nice reduction in the effective tax rate of the taxpayer. Obviously, if you're reducing the amount of tax that you have to pay because you have these tax credits, it reduces your ultimate effective tax rate. These are very low-risk profile investments. I'll talk a little bit more about the main risk recapture. There's very historically low levels of recapture. There's very low levels of foreclosure on these assets. Since the inception of the program back in 1986, I believe that the foreclosure rate on this asset type is less than 1%. So that's amazing for any asset type. The returns on a risk-adjusted basis are attractive. There's really a low risk that you won't receive the return that you've underwritten because your return is made primarily up of tax benefits and those tax benefits are allocated from the federal government. So as long as the project is completed, stays in compliance, you'll receive those tax benefits and the investors will receive the return that they are looking for. And finally, LIHTC investments are eligible for favorable gap reporting. It sounds kind of boring, but from a bank perspective, they're very interested in not impacting their earnings per share and the low-income housing tax, accounting for low-income housing tax credit investments has been approved for a certain type of accounting that does not impact their earnings per share, which makes it, again, more attractive to banks. So there are two significant economic benefits that are available to investors in low-income housing tax credit projects. The first is the tax credit itself. It's a dollar-for-dollar reduction in tax liability. As I mentioned, those credits are recognized over 10 years. Usually it's 11 years because the first year of the tax credit is a pro-rata amount of the credit based on the lease-up of the affordable units in the project. So whatever is not claimed in that first year is claimed at the end or in the 11th year of that stream. So typically we'll see an 11-year stream of tax credits. And then the second are tax losses, which are a benefit that's equal to the amount of loss, tax loss, that's generated from these partnerships times the tax rate of the investor. So for corporate investors, that tax rate is 21%. So simply put, for every dollar of loss an investor receives, it provides a 21%. So those are the two major economic benefits to investors in these low-income housing tax credit projects. And what I've done in the next couple of schedules is I've put together a sample return schedule. I think it's helpful in seeing what the benefits are on paper of investing in these projects. Starting from left to right are the capital contributions a typical tax credit investor might make for an investment in this asset type. As I mentioned before, one of the benefits they receive are tax losses. What I didn't mention are those losses are really driven by the depreciation, the tax depreciation on those buildings. So that allocation of depreciation provides an annual benefit equal to 21% of that loss. And then after that benefit, you have your low income housing tax credit. The total tax savings is simply the value of the loss benefit plus the tax credits. And occasionally there will be some cash flow to the investors that come from these investments. And overall, in this example, the after tax quarterly returns about 3.9%. Again, it's not a super rich return, as compared to some other private equity real estate funds, but it's really a safe and good risk adjusted IRR. So that would be a typical 4% low income housing tax credit project. Back here, I think I have one for 9%. 9% similar, if your equity paying on the left, losses that are driven as the investor on the left losses that are driven. As you can see, the losses as compared to the equity are less in a 9% deal. That's primarily because you're getting more tax credits per dollar of costs, but the cost of the project to construct is what drives the depreciation. So as you have a higher cost and you have more depreciation and more credit equity, it actually drives the yield down a bit on the 9% side. So overall, the yield is slightly higher on the 4% rate on the, sorry, the 9% deal, but pretty similar. And that's really a function of the tax credit pricing and the investors adjusting the pricing to factor in all the benefits that they would receive for investment in this asset type. Compliance issues. So the compliance issues are really what an owner of a project has to keep their eye on to make sure that they are protected and the tax credit stream that they have promised to their investor is protected. As I mentioned before, in order to be eligible for these tax credits, you have to have a project that has income restrictions. So all the units that have been designated to be tax credit units have to be income and rent restricted. And you have to establish a minimum amount of affordable units that your project will have up front, and you can never fall below those threshold elections. So the types, those threshold elections that are available are, and these are, again, the minimum number of affordable units that you have to maintain in your project to maintain your stream of credits. The first is the 4060 election, the first is the 4060 election, which means 40% of your units have to be rented to individuals at 60% of area median income or lower. 20%, the next election would be a 2050 election. That means 20% of your units have to be rented to tenants at 50% of area median income or less. Income averaging is a newer threshold election that's been added. What this allows is for you to have tenants up to 80% of area median income, but on average, you have to be at 60% of area median income or lower. And you have to, so you have to establish this minimum threshold of income restriction and rent restriction when you initially place your building in service. And that kind of sets your project up to, with its parameters, that at a minimum, it has to maintain for the remainder of the compliance period. And when you're looking at these, either the 60% of area median income or the 50% of area median income, the families that occupy those units, those have to earn less than the threshold income that is established for that income level, that either 60% or 50% of area median income. The other requirement is that the units have to be rent restricted. So the rent that is charged to the tenants cannot exceed 30% of the threshold income based on that unit size. So if you have a 60% area median income units and the published maximum earnings for the family, a four-person family who's occupying a unit in that building is say $10,000, 30% of that or $3,000 would be the maximum annual rent that could be charged to that family. Those rent limits change annually based on the income publications by HUD. So as incomes go up, the ability for owners to charge more rent also goes up. There are adjustments for family size. So larger family sizes can earn more income and pay more rent. There is a rent floor. So you can, once you place in service, you make an election to lock in your rent floor at that particular time. Your rents can never go below that rent floor, which is nice. So if we have a period of deflation where people start earning less and incomes go down, you don't necessarily have to reduce your rents because the incomes have gone down. And then you are allowed to have market rate units in a affordable housing project. You don't earn credits on the cost associated with building those market rate units. And from a compliance standpoint, you just have to make sure that you always maintain the same level of affordability. So if you have a low income tenant move out of a low income tax credit unit, you have to replace the next available unit of similar size with a tenant that meets the income requirements for that unit that had previously been vacated. So compliance, from a compliance standpoint, you're required to maintain those compliance with those rules for a minimum of 15 years. There's recapture, meaning the federal government come back and recapture those credits if you go out of compliance. Many projects are required to sign up for an extended use or extended affordability period of at least 30 years. When they receive an allocation of these credits, it pretty much commits them to keeping the project affordable for at least 30 years. And those requirements are memorialized in deed restrictions and regulatory agreements. And typically, there's only a termination upon foreclosure or what's called a qualified contract price process, which is a specific process for taking your project market rate outlining in the tax code. So, as I mentioned, the primary risk of these investments is recapture. Recaption can occur if there's a decrease in the qualified basis on which you calculated your original credit on. So take, for instance, that could occur if there's a casualty loss and you lost one of your units or multiple townhouse project, one of the townhouses burns down, that would result in a reduction in qualified basis. Or if a owner decided to turn a part of the residential structure into a commercial building and not make it, which would result in a loss of low-income units, that would be a reduction in qualified basis. If you ever fail that minimum set-aside, the 40-60, the 20-50, or the average income, that's a complete loss of credit. So it's a really important threshold to make sure you always meet that minimum set-aside. Renting to over-income tenants can result in the recapture, sale or foreclosure, eminent domain, and as I mentioned, damaged building, that casualty loss that results in a permanently out-of-service building. Just quickly going through this, recapture for noncompliance, typically you vet in the credits one-third in those credits in the year in which you claim them. So as you claim those credits, I'm sorry, that's two-thirds in the credits, and the remaining one-third of the credits, that's one-third each year, or one-fifth each year in the years 11 through 15 of the compliance period. As I mentioned before, if you fail to meet the minimum set-aside, all of your credits are recaptured. Otherwise, the amount of recapture is based on a pro-rata percentage, depending on how much of the, how many of the affordable units are impacted by the foreclosure. So think of a casualty loss, for instance, where you might have only a couple units, two units out of a 10-unit project, are lost because of the fire, you would essentially have 20% of your credits recaptured at that point. There's also full recapture if you sell the project or more than a de minimis portion of the project is sold. And just to the last point on this slide, historically, there are very low levels of recapture in this program, and mainly because of the risk mitigants that are on the next slide. There are non-compliance cure periods, so if you do have a casualty loss, you do have the ability to, or put those units back into service in a certain amount of time without creating permanent recapture. There's insurance out there to help protect against casualty loss during construction. Multiple levels of reserves and guarantees that are provided. Reserves funded by the development sources of the project to provide operating deficits to help prevent foreclosure. Good, experienced property managers will provide and do the correct income certifications to make sure that the units are being rented by folks that meet the requirements of the program. Owner and sponsor track record. It's very important having an owner or sponsor who's familiar with all the requirements of the program. There's just multiple levels of oversight from the state agencies to the investors. A lot of stakeholders in these projects that provide oversight, and no one wants to see these projects fail. The high demand in general for affordable housing is a risk mitigant, and to my point before, people don't want to see these projects fail. They want to see them for successful, so more of it's done and more of it's produced. And just the availability of subsidies really drive the amount of hard debt in these projects down, which obviously foreclosure being one of the major recapture risks. The less hard serviceable debt that are on these projects, the less chances of recapture from foreclosure. So that wraps up my portion. Sorry I went through that quickly, but I'm happy to field any questions that folks might have on any topic with respect to the long-term housing tax credits. Okay, thanks, Nick. I'll tell you, there is one quick one. Hopefully we have enough time for Tom, but the question we have is, if the owner sells the LIHTC at 10 years, does the 30-year compliance term still apply? How does that work? Yes, the 30-year extended use period would still apply. You're still subject to that regulatory agreement. So unfortunately, the only way to really get out of that requirement is through this process called the Qualified Contract Price Process, which is a process that can be easily implemented and is a seminar in itself. I can't really get into it here, but it's more successful in certain low-cost, in states where there was a lower cost of construction than places in the Northeast where I typically work. We rarely see the Qualified Contract Price Process go through. Okay, well, thank you, Nick. And we'll turn it now over to Tom for the third section. Appreciate your time, Nick. Well done. Thank you. Okay, thanks, everyone, for your time today. I'm going to discuss store tax credits in relation to the builder's risk renovations. Some of this is going to sound a little familiar from Kathleen's presentation as far as terminology, some of the things that you'll pick up on as I go through it. I'm going to try to keep it moving and fairly quick so we can get through and maybe have some time for questions. So this will be more of a high-level overview of the historic tax credit, not a deep underwriting review, not a deep dive analysis of historic tax credit coverage forms. We have a number, we have a large number of many builder's risk carriers. Each of the carriers, you know, you all have different varying appetites, underwriting guidelines, capacities, treaties, et cetera. Coverage forms are not all uniform with historic tax credit coverage. Historic tax credit coverage coverage forms may be proprietary, varying in coverage, terminology, wording, applicability, et cetera. So honestly, time-wise, we could spend a long time discussing and exploring all the underwriting aspects and reviewing various coverage forms, but today we'll just kind of move through with the focus of a high-level type of review here. So to get started, we want to go through with a quick polling question. Let's get an idea of how many of you have worked on or have provided historic tax credit coverage with builder's risk. You can reply, I have or I have not. We'll wait to see what everyone says. Sorry, they're coming in pretty fast and furious. I'll give it another 10 seconds or so. Yeah, no, sounds good. Make sure we get a majority rolling in. Okay, we've got a fairly good response. Okay, yeah, so 73% I have not versus 27% I have. I bet a few of those folks are from great American so may skew the numbers a little bit but probably what I expected to be in line. Is there not that many individual carriers with that with an appetite or a coverage form in writing is sort of tax credit on this sort of builders risk at this time. So let's kind of move into the underwriting aspects and we'll get into a high level view of underwriting. So, you know, look at these these projects are not your simple 30 minute turnaround time quote projects. They're not cookie cutter risk, they require a great deal of extensive review. There are abundance amounts of information that we drew outside the code, there are a number of aspects consider a lot of these are pretty familiar but, you know, you have to remember first and foremost, these are typically heavy renovation projects. And you're going to be looking at the typical renovation exposures within each project. And we know each of these projects are pretty individual. Are they got rehabs or simple updates, how extensive is the work. So structural work load bearing wall or load bearing support movement, load bearing repairs, etc. Their foundation or foundation repairs excavations or underpinning to take place. Will there be new elevator or stair shafts cut through the flooring do they cut through floor joists or support beams. Are there new or vertical horizontal additions, you know that that can alter load bearing supports things like that they may have to increase PSF by adding additional support beams things like that. And as Kathleen mentioned, some of those new additions do not qualify with the q rs for sort of tax credit. But those buildings may be of exposure to our project. They could have a vertical or a horizontal addition I should say that's 100% frame being added to a joystick masonry structure where you're increasing the fire light so just just additional things there. Are there new wall openings for windows door skylights related they're cutting through the brick replacing haven't installed lentils whatnot roofing plumbing mechanicals finishes. All the typical things you're underwriting geographic locations, obviously cats, you know, are you a cat peril, you know type of company or are you shy away from these areas do you, you have when concerns do you have flood concerns earthquake, etc. Conversion. What will the intended occupancy be versus the former occupancy layout example I mean I've got some old hostels I've looked at that are going to pretty simply become, you know, low income housing so the repartitioning or things like that. You know textile mills same thing. First of all, really important I would say is contractor specialization and experience. Some of that's going to go to tie into what Kathleen had mentioned with the secretary, the standards that they outline. So the contractor specialization experience. What's the contractors experience in historic rehab projects. Do they have a good portfolio. So a lot of these guys that you know the projects that work on I'll see a lot of the same contractors, and a lot of these guys they have pretty good websites with their portfolio information layout. Yeah, a lot of them have, you know, 3020 years experience or more, but you can see a pretty good section of their portfolio. I've got, you know, a couple of guys I look at they have 30 or 40 projects completed they have four or five others that they haven't played. So it's kind of important obviously always look at that. But more specifically, do they have experience with these types of projects. So we want to get into, you know, other things building or buildings conditions. It's extremely important for you to understand the buildings condition to undergo the proposed work review any of the building condition reports for the engineering reports that are available. Some buildings might be in a pretty solid commission where they've been conditioned where they've been maintained and protected over the years they've had occupancy not high levels of vacancy and all of that. Others you may see the ones where they've had long periods of vacancy. They've got very deteriorated aspects that allow, you know, weather elements intrusions and busted open busted or open windows collapse roofing deteriorated skylights things like that that have allowed extensive water intrusion or other elements that can affect structural integrity of the interior floor system supports beams or infrastructure. You also want to review the construction plan site plans and related information. But really importantly, another thing to consider here is going into kind of tying back into Kathleen's portion is the NPS documents. Okay. The NPS documents. This is going to outline what is the historic significance of the building. In other words, what aspects make the building historic and as Kathleen kind of discussed this is determined by the National Park Service to the NPS. So the NPS apps part one and part two narratives, along with the conditional approval should be obtained and thoroughly reviewed the part two narrative is typically a very detailed description of the historical significance of the building. The current conditions of the building and proposed work to be completed to the building. The narrative document will also have reference pictures associated with each section of conditions and proposed work. This document can be very long, but it is an integral understanding historically significant aspects conditions and work to be completed. I mean, I've had some that were as short as 15 pages for a risk and others as long as 400 pages, and it's a time consuming process. In some cases, you know, there are amendments to the proposed work. They'll amend the part two application for a section of work they're going to be doing. If you have amendments, you need to also, you know, obtain the application with the amendments interview the changes that are proposed. And again, this kind of refers back to the secretary of the interior standards for rehab. A lot of that in the part two narrative is outlined within the work to be completed. I mean, it has to meet the secretary standard. So, a lot of the descriptions of work to be done in that part two will refer to the secretary of interior standards for this has to measure this or these doors have to be this style. You know, the kind of things that Kathleen has mentioned. Sorry, let me go. Here we go. Okay, so looking at the historical significance portion, what aspects in the NPS are basic. What aspects is the NPS basing historical significance. You really want to refer back to the part two narrative. So, what aspects are that is it a time period of construction, the age, the style of construction and architecture, or are there highly ornate features that National Park Services part two narrative is going to outline a lot of that for you. Look at examples of these things. You have like, let's say, I think Kathleen also mentioned textiles versus a cathedral or church or museums, or office building hotel or former hospitals, etc. You look at a textile mill, maybe more of a specific timeframe or age, they're typically load bearing, you know, brick wall buildings of heavy timber supports Joyce of masonry, their box shape rectangular or square, very open floor space not really anything of ornate value contributing to store, but more of the timeframe period of it being a mill office and hotel buildings, they can be similar in the timeframe age but many of those also have some ornate exterior and interior features that contribute to the significance like terracotta copper materials wrought iron marble flooring special wall finishes specific corridor layout so I see some of those cathedrals or churches museums, obviously they can be much more, they can have a lot more intricate ornate aspects to them. Significant features like murals stained glass special flooring and finishes built in wallpipe orients. Yes, very specialized architecture. You can see those things out in a good example, just a quick look at the pictures here. Yeah, that nice little picture of a cathedral or church and you see architecture and, you know, the same glass and things like that versus a square box type of textile building. So, last we kind of want to touch base real quickly on just coverage and claims factors. And so, you know, I think it's important that you understand that the National Park Service will be a primary determining factor in any possible claim for a short tax credit. This goes back to a lot of things we talked about and Kathleen discussed as well the NPS solely determines and decides the building's historic significance and historic designation. So, historic tax credit losses will occur if the building loses historical designation. Coverage forms, they're going to vary depending upon proprietary forms and wording. I don't know that ISO has a specific uniform form. I know there's some AIS forms, but mostly the carriers that do play in the market of historic tax credit, you're looking at individual proprietary forms. Historic tax credit is similar to time element coverage where a loss could be paid for delay, cover cause of loss, but there is also the possible full recapture aspect. So, in a nutshell, the recapture is when the historic tax credits are taken back due to the building being deemed to no longer be of historic significance. So, basically, the building loses its historic designation. And again, this is determined by the NPS. And as I mentioned, there aren't many historic tax credit coverage forms out there, but the majority, the couple that I've seen, most do contain clauses relating to covered causes of loss involving delay and completion, or the ability to receive historic tax credit is delayed, or the insured has lost the ability to receive all or part of their historic tax credit during the post loss period of construction. So, when we look at claims, what will be a significant loss trigger? You have to refer back to the significant or historic aspects of the risk, along with the conditions and the other underwriting aspects. A key will be if any of the damage or loss can be replicated, repaired, or replaced, so as to maintain the historic significance. Will a partial loss, such as water damage, cause significant damage to the historical aspect of the risk? If the loss affects simple wood plank flooring in the building, it might not, but if the loss affects the historic built-in wallpipe organ of a church or cathedral, it could. I mean, how about a small fire, where the fire smoke damage and water damage destroys ceiling, painted murals, or stained glass? You have to give thorough consideration to whether a partial loss can create a larger recapture event, or just a possible smaller delay loss. Collapse. Obviously, one that you look at in renovations. Collapse. What if a floor system or support beam collapses within the structure? I once had a risk that I looked at the historical significance basis. Part of it was the corridor layout of the third and fourth floor of the building. So, if a beam on the second floor collapsed, causing collapse on the third and fourth floor, it could have had a major effect on the historic significance of the building, possibly even a recapture situation. Other things, you know, if you look at exterior walls, if there's a partial collapse there, can it be easily replicated, repaired, or replaced? Cats, you know, the bad word, but the worst case scenario for any of the risks, but probably more so with historic tax credit risk, cat losses can result in a full recapture type of loss, as there is typically no longer a structure of historic significance in place. Direct damage. This is when it's kind of interesting for you to think about. Direct damage. It's important to note that a direct damage loss could be significantly less than a recapture loss. And just an example off the wall, a 1 million, you know, existing structure, $10 million hard costs, and you're carrying 3 million of historic tax credit. The entire building is destroyed by a fire, let's say, in the second month, where maybe 10% of the works completed. So, the approximate loss is $2 million of direct damage, but you have a full $3 million recapture because the structure is gone. So, obviously, the higher the HCC limit, the higher the exposure of recapture and cat events. And kind of going back to the question that occurred earlier with, you know, size of projects and, you know, values and things. I mean, they are all across the board as Kathleen mentioned, but I've had projects where I might have a 2 million TV, and I've got others that are over 150 million TV, the historic tax credit portions on those may be a couple hundred thousand dollars. I've got some that I've worked on that are 20 to $30 million in tax credit values for both state and federal tax credits. And as Kathleen mentioned within the state and federal, the states can all they can vary because you do have some classes, such as meal tax credits in states. Some states allow up to a 45% tax credit for meal rehab work. So, textile meals being rehabbed, they can get up to 45% in specific states, which can create a pretty high amount of total tax credit possible. So, just really quick, and I know move through this fast, but in a nutshell, you know, the claim settlements are always going to depend on all of these factors individual to the risk itself. Basically, everything that we've kind of rushed over here, and obviously associated with the terms of the coverage form. So, as kind of a high level overview of important considerations with historic tax credits and builders risk. Now, I hope you can kind of tell that they are pretty unique. They do take time. There's a lot more that goes into it. And maybe a lot of the information I've brushed on today is a little bit helpful and enlightening. So, if there are any questions, we can try to hit them very quickly. Okay, well, thank you, Tom. And I have to say, I don't think you brushed over it at all. Came across really well, as did all 3 presentations. We have at least 1 question here that probably any 1 of the 3 presenters can answer. It's kind of almost a hypothetical, but are we finding that most clients are buying insurance for the tax credits? In looking at it from the underwriting perspective, I will tell you that I think because of the investors, it depends on the investors involved, but when you have multiple investors or investment groups, so things that Kathleen or Nick are going to work on, they're probably requiring tax credit coverage as a part of the insurance. Where I don't see that occur is if I've got a single building owner, he's collecting tax credit, he's fully funding it himself, and he's receiving tax credit, but he's not going to cover it just for the cost of saving money. That's my experience. Yeah, and the second part of it really is, Kathleen or Nick, are you requiring or do you know if there are requirements that tax credit insurance be purchased? I think that that's something that we're going to be looking at further. It's always an added bonus, obviously, if we're able to get that insurance coverage, and I think it also protects the developer in a lot of ways. Obviously, it protects the investor, but the developer will be able to fill that gap if a catastrophic loss has occurred. But we've been looking at that further in terms of requiring it potentially for more of our projects, just because it's obviously a good mitigant for this type of project. I've most commonly seen it when investors require it, depending on the strength of the guarantor or the sponsor who's providing the guarantees to the investor. If they're a relatively new developer to the space, they may not have the experience in the balance sheet that an investor is looking for, the insurance certainly can play a role in helping protect that. That's the most valuable aspect of the investor's return in these projects. I'm curious, do you think that there's a lack of knowledge that this insurance is even available? I'm going to say I think so, to a point. It benefits me in the insurance world to a point with the lack of great amounts of competition, but I think it is getting out there a little more. We're seeing a lot more of these projects in place, and I think the word of mouth spreads pretty quickly with these investment groups and developers. Obviously, Kathleen and Nicholas can speak to that point, too. Right. I think that people that are experienced in historic preservation, tax credits in particular, and some developer groups do kind of target those kinds of buildings, they would have better knowledge of seeing it in the market and things like that when they're shopping for insurance. I also agree with Nick that it also depends on the project and the guarantor strength and things like that, but potentially it won't necessarily be such a huge deal if they don't have it. In projects where the equity is tight and in order to get the project done, it's an important piece of the puzzle, then it's obviously something that we'd be wanting to have for the project. Okay. Well, thank you. I appreciate it. You actually answered the other question that was floating out there, sort of like the why is there air question. Why would we even think about insuring this? But I think all three of you have done a terrific job in answering that. So, we have nothing else coming in question wise. So, at this point, I want to wait a minute. We have one more from a broker standpoint with regard to LIHTC. They aren't interested in covering due to cost tax credit insurance not required by investors. I'm not quite sure what they're asking. I think they're saying that the costs are prohibited. But anyway, I'm just not really sure what the intent of that question was. So, I just fired it out quickly. Okay. So, anyway, it was just a comment. All right. I got you, Debra. Thank you. It's cost prohibitive. Yeah, the comment was basically the insurance is cost prohibitive. So, we see an insurance project if an investor wants to exit the project early, but there's still recapture risk related to those last kind of four years of the product for five years of the project. There might have to have some level of insurance for the case. Right. Right. Okay. Well, again, thank you all three, Tom, Kathleen, Nick. Tremendous presentation. Really nice flow, bringing it from the beginning to the end. And I thank you for your time. And I thank everybody for their time. And before we close, I'm going to turn it back over to my friend Lillian and our friend Lillian for some prizes, I guess. Yes. Thank you, Ron. And thanks also to our presenters. Wow. What a fantastic first day of the forum. So, I just wanted to say that if you registered for just day one of the forum, we will send an email to you with your survey link to you very shortly. But if you registered for day two, you'll get your survey link on Thursday. Okay. So, now it's time for most engaged. So, don't go anywhere, Ron. So, it's basically the attendee with either the best question or the most engaged attendee. We want to recognize our attendee for their participation today. Ron, did you have an attendee in mind for that? Yeah, I mean, a bit of a landslide. Not quite a landslide. Someone came in close second, but Brian Dieters kind of led the league today with some really good questions and very focused questions and quite a few of them. Fantastic. All right. Congratulations, Brian. You'll receive an Amazon gift card. All right. Thank you so much. Thank you to all of our attendees for your participation.

Low-Income Housing Tax Credits

LIHTC

Historic Tax Credits

HTC

Affordable Housing

Private Equity Investment

Tax Credits

Limited Partnerships

Community Reinvestment Act

Project Financing

Compliance Issues

Regulatory Requirements

Investor Risks