A. J. Johnson to Offer Live Webinar on The Most Common LIHTC Non-compliance - Avoiding 8823s

person A.J. Johnson today 10/16/2021

A. J. Johnson will be conducting a webinar on October 26, 2021, on Avoiding the Most Common LIHTC Noncompliance - Remaining 8823 Free.  The Webinar will be held from 1:00 PM to 2:30 PM Eastern time.

Credit loss on tax credit properties generally is the result of mistakes in six specific areas - habitability (physical condition), inaccurate determination of income at move-in, changes in eligible basis, the charging of excess rent or fees, utility allowance errors (resulting in excess rent), and non-qualified student households. This 90-minute session will provide an overview of each of these areas, with recommendations on how to avoid non-compliance that may result in credit reduction or recapture.

Those interested in participating in the Webinar may register on the A. J. Johnson Consulting Services website (www.ajjcs.net) under "Training Schedule."

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Court Decision Affirms "Necessity Standard" for Reasonable Accommodations

In Carter v. Murray, 2021, WL 4192055, CIVIL ACTION NO 21-3289 (E.D. PA, September 14, 2021), the U.S. District Court for the Eastern District of Pennsylvania ruled that a tenant was not entitled to a reasonable accommodation of permanent relocation to a unit that was free of carpet fumes and tobacco smoke since the landlord had offered a temporary relocation while repairs were made to remove the offending carpet from the unit. The landlord had also promised to adopt a smoke-free policy for the apartment complex. The suit was brought by Reginald Carter, a resident at Venango House, an apartment building in Philadelphia.  Prior to moving in in August 2018, Carter discovered that the apartment was newly carpeted and painted. Because of his lung disease, he asked management to remove the carpet. He was told this could not be done but was offered an uncarpeted apartment in the building.  He accepted the apartment, but because the linoleum floors and adhesives were also releasing toxins, he did not move in until October to allow the paint to off-gas. He was also unhappy with dust and parts of an unfinished wall. On May 15, 2019, Carter wrote a letter to the manager, Donna Murray, expressing concerns about the smoking of a fellow resident who smoked and used deodorizers to mask the smell. He requested to be moved out of his unit to allow for repainting and floor replacement.  On June 4, 2019, a tenants council meeting was held to address Carter s issues. Carter s lung problems were not brought up at the meeting, but the Council did ask the manager if smoking was going to be prohibited. On December 17, 2019, Carter wrote another letter to Murray in which he stated that he would not allow a contractor to paint his door because of COPD lung disease. He asked that the painting be put on hold until such time as tenants with lung disease could seek exemptions from having their doors painted. The painting was stopped, but no one at the property was asked if they wanted an exemption from the painting of the doors. On January 28, 2020, Carter alleged that an environmental hazard was caused by the improper removal of carpet adhesive in the hallways. He alleged that he was hospitalized twice in 2020 because he "could not walk a block without getting chest, neck, and face pains. He claimed that the "stress of living at the Venango House was a major contributing factor, and that cigar and cigarette smoke from other tenants intensified his breathing problems. In January 2021, Carter emailed Murray and a representative of the management company (Winn Companies) that the smell of paint and new carpeting made his symptoms worse. He complained in February 2021 of cigar smell in his apartment and claimed that due to the racial makeup of the tenancy at Venango House and the fact that management failed to provide 24-hour security and had no central air in the hallways, what was occurring amounted to "murder and institutional racism. On February 22, 2021, Andrew Lund, the Office Manager and Regional Vice-President of the management company, contacted Carter by email about current issues. Carter replied that the smoking issues remained and that he needed permanent relocation instead of a temporary stay at a hotel while repairs were conducted. He alleged that his relocation request was ignored from May 15, 2019 to March of 2021. Carter filed a claim against Lund, Murray and others, alleging constitutional claims for violation of the First and Fourteenth Amendments, claims under the Fair Housing Act (FHA), and state law claims. He requested an order requiring the Winn Companies to relocate him to a place of his choosing at Winn s expense, to remove certain individuals from the tenant council, and to reinstate him as council president. He also sought an order directing the Winn Companies to evict a member of the tenant council with whom Carter had a dispute and to immediately disallow smoking at Venango House The Court dismissed all the constitutional claims. The court also ruled that Carter pleaded no plausible FHA claim for disability. The FHA protects against discrimination based on disability. To state a reasonable accommodation discrimination claim, the plaintiff must plead facts showing (1)accommodations are necessary to afford him equal opportunity to use and enjoy a dwelling; and (2) the defendant refused to make reasonable accommodations in rules, policies, practices, or services. In support of this, the Court cited Vorcheimer v. Philadelphia Owners Association, (a case that those who have taken my fair housing training in 2021 may be familiar with). As stated in Vorcheimer, the element of necessity "requires that an accommodation be essential, not just preferable. A plaintiff must "establish a nexus between the accommodations that he or she is requesting and their necessity for providing handicapped individuals an equal opportunity to use and enjoy housing. The court went on to explain that even if Carter s medical conditions qualified as a disability under the FHA, it did not provide facts alleging the statutory elements of a failure to accommodate claim. In fact, the claim stated that Murray and Lund attempted to resolve Carter s complaints by meeting with Carter and offering relocation to an uncarpeted apartment, and the opportunity to move into a hotel while his floors were refinished. Moreover, Murray and Lund sent Carter an email on March 5, 2021, stating that Venango House would "work toward implementing a smoke-free policy. Thus, the defendants addressed his requests and Carter provided no facts demonstrating a failure to accommodate. For this reason, the court found Carter s disability discrimination claim was not plausible and was dismissed without prejudice. This means that if Carter can address the weaknesses in his case, he may bring it forward again. This case provides another example of fair housing claims relating to reasonable accommodation requests being dismissed when landlords make legitimate offers to meet the requirements relating to the disability - even if the offers do not match the specific demands of the plaintiff.

Progress Still Lacking in Distribution of ERAP Funds

The National Low Income Housing Coalition (NLIHC) has released findings from the organization s latest survey of state use of funding from the federal Emergency Rental Assistance Program (ERAP). As of late September, of the approximately $25 billion made available by the federal government in the first tranche (ERA1) of emergency rental assistance, states have expended or obligated only $8.4 billion (33.7%). While this is still indicative of weak performance by many states, the use of the funds has picked up in recent months. Grantees spent $550 million more in August than they did in July, while from June to July the increase was only $196 million. A total of $46 billion has been provided in ERA1 and ERA2. Percent of the money spent by reporting period is as follows: January - March: 1.1%April: 1.9%May: 3.1%June: 6.1%July: 6.9%August: 9.1% 18 states spent less than 10% of their ERA1 allocations as of the end of August. Several of these did show progress in August, however, especially Florida and South Carolina. The states with the lowest allocations are - Florida: 9%Vermont: 9%Indiana: 9%Montana: 9%Iowa: 9%Rhode Island: 8%Delaware: 7%Idaho: 7%South Carolina: 7%Tennessee: 7%Georgia: 6%Alabama: 6%Arkansas: 4%Nebraska: 4%Arizona: 3%North Dakota: 3%South Dakota: 2%Wyoming: 2% The highest performing states are - New Jersey: 78%District of Columbia: 70%Virginia: 63%Texas: 56%North Carolina: 48%Illinois: 43%Alaska: 43%Massachusetts: 41% Despite noticeable improvement, the overall rate of spending remains too low. States like NJ, VA, and TX have proven that it is possible to get this money to the tenants and landlords who need it. The high performance of these and a few other states calls into question the poor performance of so many others. In some cases, the fault lies with state legislatures or local governments. Congress is also partly to blame for a faulty allocation formula, which provided some grantees with more funding than needed. In some cases, landlords are refusing to participate in the program. But the primary reason for the lack of distribution is that many program administrators are not following clear Treasury guidance and are not willing to adopt proven best practices. These poor performers often do little (if any) outreach, do not hire enough staff to process the applications, and have complex and burdensome application procedures. Very few of the slow spenders allow renters to self-attest eligibility, despite federal guidance that has urged it for months. Less than a third of programs allow assistance to go directly to tenants, despite it being permitted and critical to keeping residents housed when landlords refuse to participate. The best and fastest spending programs are doing all these things. There are signs that some weaker performing states are taking steps to improve - South Carolina and Arkansas are examples. Hopefully, others will follow suit and this important resource will further improve the desperate housing situation that many tenants and landlords are facing.

HUD Provides Fair Housing Funding to 51 Agencies

On November 3, 2021, the Department of Housing & Urban Development (HUD) awarded $13.6 million in American Rescue Plan (ARP) funding to enable 51 HUD Fair Housing Initiatives Program (FHIP) agencies to conduct a wide range of fair housing enforcement, education, and outreach activities related to the COVID-19 pandemic. Among the activities that will be conducted by the agencies is addressing discriminatory practices in underserved communities (i.e., minority neighborhoods). The funds, which were awarded under FHIP s Private Enforcement Initiative (PEI), are the first ARP competitive grants that focus directly on the unequal impact the COVID-19 pandemic has had on communities of color, low-income communities, and other vulnerable populations. Specific activities that will be carried out include responding to housing inquiries, investigating fair housing complaints, conducting fair housing testing, providing legal assistance, conducting education and outreach, and covering costs associated with providing services related to the pandemic. Another $5,757 million in ARP funding will be made available to eligible applicants that did not receive funding in this first round. Organizations in 26 states and DC received funds, ranging from $75,000 to $350,000. The types of organizations that received funding include legal aid agencies, fair housing testing agencies, and educational organizations. New York and Ohio both received six awards while California and Illinois each received four. Other states receiving grants are: AlaskaArkansasArizonaConnecticutDistrict of ColumbiaFloridaGeorgiaHawaiiIdahoIndianaMassachusettsMichiganMinnesotaMississippiMissouriNorth CarolinaNorth DakotaNew HampshireNew JerseyNevadaPennsylvaniaWashingtonWisconsin Housing operators in these states should expect increased fair housing testing and compliance actions during the upcoming 12 months as a result of these grants.

A. J. Johnson to Host Live Webinar on Interviewing Skills for Affordable Housing Managers

A. J. Johnson will be conducting a webinar on November 23, 2021, on Interviewing Skills for Affordable Housing Managers.  The Webinar will be held from 1:00 PM to 4:00 PM Eastern time. One of the most important skills any affordable housing manager can possess is the ability to interview applicants and residents and obtain the information required to determine eligibility - this is also one of the greatest weaknesses of most affordable housing managers. This training has been developed to address that weakness. This three-hour session focuses on the interview process and provides concepts and tools that will aid managers as they conduct their interviews. Techniques apply to all interview settings including initial eligibility interviews, interim certifications, and annual recertifications. The primary emphasis is on the initial eligibility interview since it is so critical to the housing process. The skills taught during this session will also assist managers in detecting fraud and in dealing with third parties when resolving discrepancies. Those interested in participating in the Webinar may register on the A. J. Johnson Consulting Services website (www.ajjcs.net) under "Training Schedule.

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