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Staff warns HUD HOTMA rule change will disqualify applicants with large assets for LIHTC units
Summary
Staff reported new HUD HOTMA rules that bar applicants with more than $100,000 in assets from qualifying for LIHTC apartments; current residents will be grandfathered. The committee discussed vacancy management and tenant form updates.
Staff members at the Central Wisconsin Community Action Council’s PBP Committee reported that a federal change to HUD’s Housing Opportunity Through Modernization Act (HOTMA) eligibility calculations will affect who can qualify for Low-Income Housing Tax Credit (LIHTC) apartments.
Staff member Monica Zimmer said the new rule removes the prior option to use a percentage of assets in eligibility calculations and instead bars applicants whose assets exceed $100,000 from qualifying. She also noted a separate HUD rule that requires a resident to vacate a unit if absent for more than six months. Zimmer said current residents in the agency’s LIHTC apartments will be grandfathered and that tenant emergency contact forms are updated annually.
The committee heard that the change could reduce the applicant pool and that staff will need to adjust intake and wait-list procedures. Zimmer said the agency is reviewing whether unit-percentage eligibility can be adjusted after occupancy periods; no final policy changes were approved at the meeting.
Next steps: staff will incorporate the HOTMA eligibility rules into applicant screening and report back on any proposed wait-list or unit-percentage adjustments to the board.
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