This essay is about an obscure issue that got me interested. A while ago, a Virginia attorney posed a question on a list serve about the reach of the foreclosure clause in 26 U.S.C. § 42(h)(6)(E)(i)(I), part of the Low Income Housing Tax Credit (“LIHTC”) program. Under this clause, when a LIHTC building is acquired by foreclosure, the (new) landlord is excused from the Extended Use Period, a 15-year period that normally extends LIHTC tenant protections from the initial 15 years to a total of 30 years. The question was whether a property-tax forfeiture acts like a foreclosure.
Eventually the Virginia dispute resolved on other grounds, but in the meantime I’d gathered some material on the issue. I combined it with LIHTC materials I’d put together over the years, and provided some advice.
While the issue is unusual, I’d spent a considerable amount of time gathering the material. Therefore, I decided to present my findings and thinking in this essay, available in Word and in PDF. I conclude that tax forfeiture does not provide the new landlord with the foreclosure escape hatch.
The Word version of the essay has links to cited materials. The end of the essay is a two-part Appendix with links to materials not generally available on the Internet, some cited in the essay plus a couple of others that also relate to the issue.
Birnberg Minnesota Legislative Newsletter 