Leveraging Green Building to Incentivize Housing Affordability

The Low-Income Housing Tax Credit (LIHTC) program is an important resource that incentivizes the creation of affordable rental housing. It provides state and local agencies the equivalent of nearly $8 billion in annual budget authority to issue tax credits for housing projects targeted to lower-income households.

Each state approves a Qualified Allocation Plan (QAP) to establish the criteria agencies use to award LIHTCs. Some states require or include bonus points in their QAPs for third-party green certification of the LIHTC properties.

NAHB recently showcased a map highlighting current green program inclusions in each state’s QAP at the NCSHA Housing Credit Connect Conference in San Francisco to provide a genesis for conversations with housing credit professionals. Attendees learned how using green building certification programs may aid multifamily builders in qualifying for LIHTC in their state.

The map and accompanying table show which state QAPs recognize one or more green certification programs. Project certification is required to qualify for LIHTC funding in a few states, such as Georgia, but most award points toward program qualification. More than half of states recognize one or more programs, enabling multifamily developers to select the most appropriate green program for their specific project.

In states that include requirements or bonuses for third-party green certifications, NAHB works with their state and local HBAs to advocate for state housing finance associations (HFAs) to consider offering choices for green certifications to standards such as the National Green Building Standard (NGBS) and ENERGY STAR. A recent win includes Virginia’s addition of the NGBS as a choice in its latest QAP to gain points toward LIHTC.

For more information about your state’s LIHTC QAP green program offerings, contact Program Manager Michelle Diller.

To stay current on high-performance building, follow NAHB’s Sustainability and Green Building team on Twitter.

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