Recovery Act
Survey of State Housing Finance Agencies' Use of the Low-Income Housing Tax Credit Assistance Program (TCAP) and the Section 1602 Program
Gao ID: GAO-10-1022R September 20, 2010
In February 2009, Congress created two new programs as part of the American Recovery and Reinvestment Act of 2009 (Recovery Act): (1) the Tax Credit Assistance Program (TCAP) administered by the Department of Housing and Urban Development (HUD) and (2) the Grants to States for Low-Income Housing Projects in Lieu of Low-inome Housing Credits Program under Section 1602 of the Recovery Act (Section 1602 Program) administered by the Department of the Treasury (Treasury). Congress created these new programs to address the lack of private investment capital in Low-Income Housing Tax Credit (LIHTC) projects after the credit market was disrupted in 2008. Both programs were intended to provide gap financing for stalled, "shovel-ready" projects and to offset a drop in tax credit demand and pricing. Under these programs, state Housing Finance Agencies (HFA) administer federal funds in the form of grants and loans from HUD and Treasury to fill financing gaps in planned tax credit projects.
As part of our work examining how federal agencies and HFAs are implementing TCAP and the Section 1602 Program, we developed a Web-based survey for HFA managers in all 50 states, the District of Columbia, Puerto Rico, Guam, and the U.S. Virgin Islands. Our survey asked about the status of program delivery, program design, safeguards and controls, expected results, and challenges to implementation. We distributed our survey in November and early December 2009 and received usable responses from all 54 agencies. We designed the self-administered questionnaire in consultation with experts, representatives of housing finance stakeholders, and state agency managers. While all state agencies returned questionnaires, and thus our data are not subject to sampling or overall nonresponse error, the practical difficulties of conducting any survey may introduce other errors in our findings. We took steps to minimize errors of measurement, question-specific nonresponse, and data processing. In addition to the design activities described above, we pretested the questionnaire with four state agency officials before the survey, and also (1) contacted each agency before the survey to determine whether our originally identified respondent was the most appropriate and knowledgeable person to answer our questions, and made changes to our contact list as necessary; (2) resolved respondent difficulties in answering our questions during the survey; and (3) recontacted selected respondents to follow up on answers that were missing or that required clarification. Finally, we independently verified analysis programs and other data analyses.
E-supplements Recovery Act: Results of GAO's Survey of State Housing Finance Agencies' Use of the Low-Income Housing Tax Credit Assistance Program (TCAP) and the Section 1602 Program (GAO-10-1023SP, September, 2010), an E-supplement to GAO-10-1022R
GAO-10-1022R, Recovery Act: Survey of State Housing Finance Agencies' Use of the Low-Income Housing Tax Credit Assistance Program (TCAP) and the Section 1602 Program
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Section 1602 Program' which was released on September 20, 2010.
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GAO-10-1022R:
United States Government Accountability Office:
Washington, DC 29=0548:
September 20, 2010:
The Honorable Robert Menendez:
Chair:
The Honorable David Vitter:
Ranking Member:
Subcommittee on Housing, Transportation, and Community Development:
Committee on Banking, Housing, and Urban Affairs:
United States Senate:
The Honorable Maxine Waters:
Chair:
The Honorable Shelley Moore Capito: Ranking Member:
Subcommittee on Housing and Community Opportunity:
Committee on Financial Services:
House of Representatives:
Subject: Recovery Act: Survey of State Housing Finance Agencies' Use
of the Low-income Housing Tax Credit Assistance Program (TCAP) and the
Section 1602 Program:
In February 2009, Congress created two new programs as part of the
American Recovery and Reinvestment Act of 2009: (1) the Tax Credit
Assistance Program (TCAP) administered by the Department of Housing
and Urban Development (HUD) and (2) the Grants to States for Low-
income Housing Projects in Lieu of Low-inome Housing Credits Program
under Section 1602 of the Recovery Act (Section 1602 Program)
administered by the Department of Treasury (Treasury).
Congress created these new programs to address the lack of private
investment capital in Low-income Housing Tax Credit (LIHTC) projects
after the credit market was disrupted in 2008. Both programs were
intended to provide gap financing for stalled, "shovel-ready" projects
and to offset a drop in tax credit demand and pricing. Under these
programs, state Housing Finance Agencies (HFA) administer federal
funds in the form of grants and loans from HUD and Treasury to fill
financing gaps in planned tax credit projects.
As part of our work examining how federal agencies and HFAs are
implementing TCAP and the Section 1602 Program, we developed a Web-
based survey for HFA managers in all 50 states, the District of
Columbia, Puerto Rico, Guam, and the U.S. Virgin Islands. Our survey
asked about the status of program delivery, program design, safeguards
and controls, expected results, and challenges to implementation. We
distributed our survey in November and early December 2009 and
received usable responses from all 54 agencies.
We designed and tested the self-administered questionnaire in
consultation with experts, representatives of housing finance
stakeholders, and state agency managers. While all state agencies
returned questionnaires, and thus our data are not subject to sampling
or overall nonresponse error, the practical difficulties of conducting
any survey may introduce other errors in our findings. We took steps
to minimize errors of measurement, question-specific nonresponse, and
data processing. In addition to the minimizing errors as described
above and pretesting the questionnaire with four state agency
officials before the survey, we also:
* contacted each agency before the survey to determine whether our
originally identified respondent was the most appropriate and
knowledgeable person to answer our questions, and made changes to our
contact list as necessary;
* resolved respondent difficulties in answering our questions during
the survey; and:
* recontacted selected respondents to follow up on answers that were
missing or that required clarification.
Finally, we independently verified analysis programs and other data
analyses.
We first reported results of our survey in our May 2010 Recovery Act
report, where we described HFA progress and challenges in implementing
TCAP and the Section 1602 Program and the programs' impact on the
LIHTC market.[Footnote 1] In our September 2010 Recovery Act report we
describe oversight activities planned by HFAs for TCAP and Section
1602 Program projects (GAO-10-999). In addition to data on these
issues, we collected other information about TCAP and the Section 1602
Program that can inform Congress, HUD and Treasury, HFAs, and industry
stakeholders about overseeing the programs. To link to the e-
supplement that shows the survey questions and summarizes the
responses by question, click on GAO-10-1023SP.
We are sending copies of this report to HUD, Treasury, and other
interested parties. In addition, this report will be available at no
charge on GAO's Web site at [hyperlink, http://www.gao.gov].
If you have any questions or need additional information, please
contact me at (202) 512-8678 or sciremj@gao.gov. Key contributors to
this report include Andy Finkel (Assistant Director), Roberto Pinero,
Jennifer Alpha, Swati Thomas, Heather Chartier, and Carl Ramirez.
Signed by:
Mathew J. Scire:
Director, Financial Markets and Community Investment:
[End of section]
Footnotes:
[1] See GAO, Recovery Act: States' and Localities' Uses of Funds and
Actions Needed to Address Implementation Challenges and Bolster
Accountability, [hyperlink, http://www.gao.gov/products/GAO-10-604]
(Washington, D.C.: May 26, 2010), 138-163.
[End of section]
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