Michigan Posts Income Averaging Guidance

A memorandum dated June 13, 2018 and titled “Income Averaging Guidance” has been posted to the LIHTC Recent Updates page of the MSHDA website.

The guidance opens income averaging to both 9% and 4% projects with several requirements, including:

• Market Study: MSHDA will require a market study through MSHDA specifically reviewing the marketability of the proposed rent levels.
• 4%: Applicants should know this election is only available to LIHTC units and is not available to the bond program, therefore, 4% bond projects must meet the requirements of both the bond program and the LIHTC program.
• Applicants will need to retain evidence from all funding providers (syndicator/investor, lender, etc.) showing that the parties are comfortable with the income averaging election.
• Approved projects that have not yet received an 8609: These projects may be granted the income averaging set aside at the discretion of MSHDA