Tax Credits are awarded by HPD to qualified low-income housing projects in New York City. To be eligible, projects must be substantial rehabilitation or new construction with at least 20% of apartments reserved for low-income households. During annual funding rounds, developers apply competitively to HPD for allocations of tax credits, which are awarded based on selection criteria specified in the City’s Qualified Allocation Plan (see below). Once tax credits are allocated to a project, the developer typically sells the credits to corporate investors who supply private equity to cover a portion of development costs. The investors often participate through pooled equity funds raised by syndicators such as the New York Equity Fund, the Enterprise Social Investment Corporation and others. The investors receive credits that reduce their corporate federal income tax bills for ten years.
HPD allocates a portion of the Low Income Housing Tax Credits available to the State of New York; the amount of HPD’s authority is negotiated annually with the State. Typically, HPD allocates $10-$12 million in credits per year to 40 or more projects with a total of 1,200 low income units.
For more information, visit to NYC Department of Housing Preservation and Development
