§4103 Appraisal and preservation value of eligible low-income housing

Summary

When an owner files a notice saying they plan to extend low-income rules or transfer a low-income housing project, the Secretary must get a preservation value appraisal. Two independent appraisers will set that value: one picked by the owner and one picked by the Secretary. The appraisals must be done within 4 months, and the owner must give the Secretary the owner’s appraisal within 90 days after getting the Secretary’s notice. If the two appraisers (and the owner and Secretary) cannot agree, they pick and pay a third appraiser together and that third appraisal is final. The Secretary must send the owner a written notice within 30 days of the filing explaining the need for the appraisal, the rules and deadline, that the Secretary’s appraiser will inspect the property and records, and whether a State agency will help. Any appraisal used to approve incentives must be no older than 30 months. Preservation value means fair market value. For keeping the low-income rules and getting incentives, it is the value assuming the property’s best use is as rental housing. For transfers, it is the value based on the property’s highest and best use. The Secretary must give written appraisal rules that assume paying off federal mortgages, ending current low-income rules and federal rental aid, and paying any state or local compliance costs. The rules can use State agency rehab assessments and must tell appraisers to use either actual operating costs (the average of the last 3 years) or projected post-conversion costs, whichever is higher, and to estimate rehabilitation and conversion costs for market-rate or highest-and-best-use conversions.