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Updated Treasury Guidance Makes It Easier to Use ARPA Funds in LIHTC Housing

The U.S. Treasury has issued updated guidance that will make it easier to assist Low-Income Housing Tax Credit (LIHTC) projects and other affordable housing developments in responding to the COVID-19 pandemic using State and Local Fiscal Recovery Funds (SLFRF) authorized by the American Rescue Plan Act of 2021 (ARPA).

The SLFRF program allocated $350 billion to state, local, and Tribal governments to support their response to and recovery from the COVID-19 pandemic. Treasury’s final rule on the program made affordable housing an eligible use of SLFRF, but its structure made it difficult – if not impossible – to use the funds for LIHTC projects and other long-term affordable housing investments. Treasury’s recent actions update that final rule to permit governments to use SLFRF funds to fully finance long-term affordable housing loans, including the principal of any such loans, subject to certain conditions.

LeadingAge National’s summary of Treasury’s July 27th updates – including what they could mean for Rental Assistance Demonstration for Project Rental Assistance Contracts (RAD for PRAC) conversion transactions – and link to the official guidance can be found here.

Contact: Annalyse Komoroske Denio, akomoroskedenio@leadingageny.org, 518-867-8866