Low-Income Housing Tax Credits & Energy Efficiency in Utah, 2018

Utah's 2018 Qualified Allocation Plan (QAP) includes requirements for energy efficiency.

A. Energy Star Requirements

Energy Star is a nationally recognized standard for housing construction and appliances used to foster more energy-efficient housing. The Energy Star Certification requires a 15% improvement over Utah’s current residential energy code. UHC believes that energy efficiency is important because increasing utility costs will affect the future feasibility of Housing Credit projects.

UHC Requirements:

  • All new construction must be Energy Star Certified.
  • All rehabilitation projects must be Energy Star certified or Energy Star enhanced if certification cannot feasibly be achieved.
  • Projects electing Enterprise Green Communities Initiative or LEED certification are not exempt from Energy Star Certification.

New construction and rehabilitation projects must receive a plan review analysis from the Utah Energy Conservation Coalition (UECC) or other certified reviewer and upon completion of construction receive Energy Star Certification. The Application must include the Energy Star submittal form with expected cost increases and savings. (See Exhibit 6C for the Energy Star Submittal Form and follow-up procedures). Because Energy Star improvements are part of Eligible Basis, rebates from utility companies that result from Energy Star Certification must go back to the project and be reflected in the sources and uses at the time of Application (if known) and at the time of final cost certification.

See the Energy Star website for more information at www.energystar.gov.

B. Submit Energy Star Certification

Projects that are Energy Star Certified must submit a UECC (or other) Certification at the time of Final Cost Certification. Projects that do not receive Energy Star Certification must submit a confirmation that the project was built according to the Energy Star specifications or required enhancements represented in the Energy Star submittal, its performance test results, and the HERS score. Rehabilitation projects must be improved to obtain an Energy Star Certification or be Energy Starenhanced if certification cannot feasibly be achieved. The owner must work with the rating organization to implement certain construction enhancements to obtain an Energy Star Certification. A certified rating organization’s analysis for a current HERS score and plan  review analysis must be submitted with the Application. UHC will require test results using Energy Star sampling requirements from the rater at the completion of the project.

C. Enterprise Green Communities Initiative – 5 points

Projects claiming points for this certification must submit a copy of the Enterprise Green Communities Certification Request Form with the Application. If the project fails to achieve a successful certification from the Enterprise Green Communities Initiative, at the time of Final Cost Certification, UHC may reduce the amount of Housing Credit up to an amount that when multiplied by the purchase price of the credits equals the full amount of Developer fee. UHC may request copies of all documentation submitted to Enterprise Green Communities in support of the certification application. Projects claiming points in this category must submit with the Application a narrative detailing the upgrades that are considered “green,” over and above costs that would be incurred for the baseline standards of building to Energy Star requirements. For example, Low-E windows are baseline Energy Star enhancements, and therefore would not be considered an enhancement for the Enterprise Green Communities Initiative. (This example is for purposes of differentiating costs only. The Applicant may in fact receive credit toward certification for Low-E windows through the Enterprise Green Initiatives Certification program.) A reflective white roof, however, is not an Energy Star minimum standard and therefore would be considered an enhancement for purposes of claiming points in this scoring category. The narrative must contain a detailed itemization of such improvements and an estimate of the additional cost. The total cost of the improvements will be entered on a separate line in the construction budget portion of the Application and will be included in Eligible Basis for purposes of calculating the amount of credits requested.

D. LEED and National Green Building Standards (NGBS)

If an Applicant elects to undertake a LEED or NGBS certification, a self-certifying written statement must be provided at the time of Application. The statement must contain a detailed itemization of the specific improvements and an estimate of the costs that are expected to be incurred over and above those costs that would be incurred for the baseline standards of building to Energy Star requirements. The statement must also itemize costs related to the certification of the project. The total cost of the improvements must be entered on a separate line in the construction budget portion of the Application and will be included in Eligible Basis for purposes of calculating the amount of credits requested. Please note that the cost of the LEED or NGSB certification, including additional architectural or general contractor documentation, must be accounted for separately and will not be included in Eligible Basis. Subsequently, at the time of the closing with the Equity partner, a certification letter from the architect must be provided.

E. Other Sustainable Opportunities

Certain grants and financing may be available to projects through programs such as the Enterprise Green Communities program, State of Utah Weatherization, renewable energy  tax credits, state and local tax credits and incentives, and utility company incentives.

Contributed By: 
National Housing Trust

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