Important: On July 27, 2023, the Members of the Agency Board voted to approve an extension of the cost cap waiver to include 9% projects awarded through the close of calendar year 2022.

Section 42(m)(1)(A)(iv) of the Internal Revenue Code permits a waiver/ exception of the approved QAP, so long as “a written explanation is available to the general public for any allocation of a housing credit dollar amount which is not made in accordance with established priorities and selection criteria of the housing credit agency.”

Further, N.J.A.C. 5:80-19.1 permits the Agency to waive any of its regulations provided that such waiver 1) does not contravene the Agency’s enabling statute and 2) the Agency finds that such waiver promotes the statutory purposes of the Agency. 

Eligibility Process: Market conditions continue to affect the construction industry and multifamily development across the state of New Jersey. Increased construction costs and rising interest rates have resulted in funding gaps and delays in project closings and the start of construction for many housing deals. 

Therefore, projects awarded in 2022 requesting a cost cap waiver must provide written justification with supporting documentation of associated fees and construction wage rates for the increase in Total Development Costs in order to be eligible for the waiver.

Owners/developers must provide detailed documentation for specific construction categories, including but not limited to: materials, equipment purchasing, appliances, union/labor requirements, specific PPE needs, cost, etc.   

Awarded 2022 projects that benefit from this cost cap waiver shall receive no more than two awards in the next 9% competitive round.

Questions? Need Help? 

If you have questions, e-mail your requests to the LIHTC mailbox at NJHMFAtaxcredits@njhmfa.gov.

Access forms, checklists, policies, previous developer bulletins, and more under the Developer Tab, on the NJHMFA website.