In a key development, the U.S. Treasury Department has modifies original deadline for disbursement of low-income housing tax credit exchange program (Section 1602) funds by state housing credit agencies to assisted projects. The law requires that state agencies return to Treasury any funds they receive that are not used to make subawards before January 1, 2011. The new, interim final rule retains this requirement. However, it provides that once a subaward has been made by this deadline, a state can continue to disburse funds to the project through December 31. 2011, provided that the project is at least 30% completed by the end of 2010. Before, no funds could be disbursed to a project after December 21, 2010. The preamble to the interim rule indicates that the original requirement was overly restrictive and might preclude funding of otherwise eligible projects that might not reach final completion by the end of 2010. The new rule is effective August 31, 2009. Treasury has solicited public comments by September 30.  read more…