Rental Housing ComplianceOur Compliance regional teams monitor a property’s occupancy requirements under the federal Housing Tax Credit Program, Tax Exempt Bonds, HUD regulations and Virginia Housing specific requirements. This includes a review of property records and the physical condition of all monitored properties.
We strongly encourage owners to review all documentation such as Internal Revenue Code Section 42 and Section 142, the Extended Use Agreement (EUA), Loan Agreement and any other statutory and regulatory requirements for their property.
Average Income Test (AIT) Written Guidance
Virginia Housing will monitor the AIT according to the IRS Average Income Test Final Rule, property-specific occupancy requirements in the Extended Use Agreement, Regulatory Agreement, and IRS 8609 form. Virginia Housing may amend its AIT written guidance to conform with the regulations and IRS guidance or as may otherwise be appropriate, as determined by Virginia Housing.
Noncompliance discovered and corrected before receiving notice of a Virginia Housing compliance monitoring audit is not reportable to the IRS and shows due diligence in managing the program requirements.
Annual AIT Reporting:
The owner must annually report the compliance status of all units, including:
- Unit Designation Changes and
- the Qualified Group of Units for the AIT ("AIT QGU") and
- the Qualified Group of Units for the Applicable Fraction ("Applicable Fraction QGU") and
- Excluded Units
- Conventional Rental Loan Forms and Documents
- Federal Housing Credit Program Compliance Forms and Guidelines
See our Compliance Forms and Documents page to view:
Additional Tools and Resources
Tenant Certification Reporting System
HDS NextGen is the online tenant compliance monitoring system we use to track compliance requirements in our rental portfolio. Property managers must update all tenant information regularly into the system, including activities such as move-in/move-out, transfers, required recertifications and change in unit designation.
Virginia Housing relies on the tenant data entered in the online tenant monitoring system to review and confirm program requirements for audits, to assist properties, and for required annual program reporting.
We appreciate your cooperation and our continued partnership in meeting the shared mission of providing affordable housing throughout Virginia.
Click below to register for an HDS NextGen account.
Note: You must use either Google Chrome or Microsoft Edge when using HDS NextGen.
Video Resources on HDS NextGen
- Logging In and Navigation
- Adding a Unit
- Creating a Tenant Income Certification (TIC)
- Move-in and Initial Certifications
- Unit Transfer Certification
The Project Information Report and the annual Owner’s Certification report will be distributed to the primary owner and management contacts for our tax credit projects on Monday, January 9, 2023. The reports will be sent from the Virginia Housing regional email accounts using Adobe Sign. The deadline to submit the compliance monitoring fees and completed and executed reports is Friday, March 10, 2023.
Immediately report all changes in property ownership, management agent, and on-site property contacts to your assigned Compliance Officer, so we can update our records before the annual reports are distributed.
Review the instructions in the Annual Tax Credit Reporting User Instructions for guidance.
Send questions to Compliance-AssetManagement@VirginiaHousing.com.
Compliance Monitoring Fees Due for 2022
Virginia Housing will also resume the collection of Tax Credit monitoring fees for the 2022 reporting year. Please do not send compliance monitoring fee payments until the property invoice is sent with the annual Owner's Certification report. Our banking information has changed; do not use prior information for wires and direct ACH.
Electronic Invoice Payment Portal
Virginia Housing has implemented a new electronic invoice payment portal to collect fees. The payment portal provides options to set up a free, one-time direct draft from a banking account or charge to a credit card (for an additional 3% transaction fee). Virginia Housing uses a banking provider; no account information will be stored after the transaction is complete. The payment portal can accept invoices for multiple projects in one transaction and provides an immediate email confirmation. We strongly encourage electronic payment of all fees using the new payment portal.
To access the Electronic Invoice Payment Portal, scroll to the top of this webpage, click "Login" in the top right corner, and select "Rental Housing Invoice Portal." Review the Rental Housing Invoice Portal Instructions for guidance.
Average Income Test Annual Reporting
The annual report of the Qualified Group of Units for the Average Income Test and Applicable Fraction is due for the 2022 reporting year.
Projects with Average Income where all buildings are placed in service by December 31, 2022, must attach:
- a Rent Roll from the project’s property management software or property tenant tracking records showing all current tenants, the assigned income limitations and rent charged
- and the Occupancy and Demographics Excel report from the online tenant monitoring system formatted according to the AIT annual report instructions included in the Annual Tax Credit Reporting User Instructions.
ES-01 and Decontrol Annual Reporting
On Friday, January 6, 2023, the ES-01 form and Decontrol Period Owner's Certification will be sent from Virginia Housing regional email accounts using Adobe Sign. The deadline to submit all completed and executed reports is Friday, March 10, 2023.
The ES-01 form will be sent to the primary owner contact of all properties financed by Virginia Housing. Property owners are required to certify tenant eligibility and provide documentation as determined by Virginia Housing’s regulatory documents.
The Decontrol Period Owner’s Certification will be sent to the primary management and owner contacts as required in the Extended Use Agreement (EUA) for Decontrol sites. All Decontrol projects have been notified in writing of their Decontrol start and end date. The annual Decontrol Period Owner’s Certification certifies adherence to the Virginia Housing protections for existing tenants until the EUA required three-year Decontrol Period ends. Contact your assigned Compliance Officer if you have questions about your project’s Decontrol status.
Through the Housing Credits Qualified Allocation Plan (QAP), Virginia Housing partners with Referring Agents to provide a leasing preference within the Virginia Housing Portfolio to persons with disabilities, known as the Target Population. The Referring Agent determines eligibility of the Target Population and refers them to properties in our portfolio. For more information on property requirements, refer to the Target Population Leasing Preference document linked below.
Housing Credit property owners must include the cost of all resident-paid utilities, excluding phone, cable TV and internet, in the gross rent charged to residents. To do this, owners must obtain a utility cost allowance for Housing Credit units. The utility allowance must be deducted from the applicable Maximum Tax Credit Rent Limit to determine the maximum rent that can be paid by a resident.
External Training Resources
- Liz Bramlet Consulting, LLC
National Center for Housing Management (NCHM)
Ross Business Development
A.J. Johnson Consulting
Novogradac & Company LLP
Nan McKay & Associates
If you have any questions , please contact your assigned Compliance Officer or email: Compliance-AssetManagement@VirginiaHousing.com