1. (a) The Arkansas Development Finance Authority requires that each development owner or manager maintains an administrative file/binder for the authority’s LIHTC recordkeeping procedures.

2. (b) Since the information will be reviewed by the authority during each visit, the administrative file/binder must include, but is not limited to the following items:

   1. (1) Completed 8609 forms on each building with building identification numbers (signed by the authority, Part II completed, and signed by the development owner);

   2. (2)

      1. (A) Records that indicate the character and use of any nonresidential portion of the development included in eligible basis as defined under I.R.C. § 42(d).
      2. (B) For example, tenant facilities that are available on a comparable basis to all tenants for which no separate fee is charged for the use of the facilities or facilities reasonably required by the development;
   3. (3) Certificates of occupancy or approval;
   4. (4) The eligible basis and qualified basis of the building at the end of the first year of the credit period;
   5. (5) Copy of land-use restriction agreement or other extended use agreement;
   6. (6) List of the first-year qualifying tenants (date entered and unit qualified);
   7. (7) Total number of units in the property (this information must be retained on a building-by-building basis, including the number of bedrooms and the square footage of each unit);
   8. (8) Department of Housing and Urban Development income/rent tables and utility allowance calculations for all years the development has been placed in service;
   9. (9) Rent increases and date new rent will be effective and notification to the tenants;
   10. (10) Rent specials, when they started, and when they ended;
   11. (11) Rents charged on each type of unit, including applicable utility allowances for all years the development has been placed in service;
   12. (12) Management review questionnaire with required project certifications;

   13. (13)

       1. (A) Nonresidential use fee (i.e., additional fees charged for parking, etc.).
       2. (B) Outline all nonoptional and optional tenant fees;
   14. (14) 20/50 test, I.R.C. § 42, or 40/60 test, I.R.C. § 42 (also known as the minimum set-aside);
   15. (15) Partnership agreement;
   16. (16) Management agreement;
   17. (17) Evidence of fair housing compliance and a copy of any complaints filed against the project;
   18. (18) Copies of reports submitted to the authority (such as occupancy status reports), annual owner’s certification form, and any project change request forms, if applicable; and

   19. (19)

       1. (A) Bank statements to confirm amounts in operating reserve account and replacement reserve accounts.
       2. (B) Note. In order to monitor the balances in the operating reserve account and the replacement reserve account, the authority requires owners to attach current year-end bank statements to the annual Owner's Certificate of Continuing Program Compliance throughout the compliance period.
3. (c) The most recent financial statements will be reviewed by the Compliance Department of the Arkansas Development Finance Authority during the monitoring visit.

4. (d)

   1. (1) First-year records (including the tenant file for each tenant that initially occupied the LIHTC units, rent rolls, etc.) provide evidence that the property met its:

      1. (A) Minimum set-aside;
      2. (B) Targeted applicable fraction; and
      3. (C) Other elected set-asides.
   2. (2) Such first-year records must be kept for a minimum of twenty-one (21) years, and subsequent records must be kept for a minimum of six (6) years, as mandated under the Internal Revenue Code.
   3. (3) The authority requires the owner to certify on the Owner's Certificate of Continuing Program Compliance that he or she is complying with this section of the Internal Revenue Code.

Codification Notes: "LIHTC" means low-income housing tax credit.