The Ohio Housing Council submits comments on the first draft of OHFA's Multifamily Rental Underwriting Guidelines, identifying several areas where proposed changes could create barriers to affordable housing development or reduce the number of units that can be financed.

Priority Concerns:

• Tax Abatement Documentation Requirements: The draft would require letters from county auditors rather than from the governing bodies that actually grant abatements, creating a non-transparent veto point for projects already approved through public processes.
• Replacement Reserve Increases: Proposed increases of approximately $50 per unit annually would reduce permanent loan capacity without clear evidence of systemic property deterioration justifying the change.
• Equity Pricing Stress Test Requirements: Universal stress testing requirements should be replaced with targeted requests when specific outliers warrant scrutiny.
• Financing Commitment Language Consistency: The Underwriting Guidelines and QAP contain inconsistent language regarding financial commitment documentation requirements.

Secondary Concerns:

• Operating Expense Documentation and Timing: Clarification needed on when and what documentation is expected for insurance and property tax assumptions.
• Annual Income Escalation and Cash Flow Requirements: Questions about OHFA's intent with varying cash flow projection requirements based on funding sources and whether tools can support analysis beyond 15 years.
• Related Party Acquisition Progress: Appreciation for improvements while requesting continued dialogue on complex scenarios not fully addressed.
• Cost Containment Exception Process: Recommendations to replace "third-party cost analysis" requirement with more flexible documentation standards and avoid overly prescriptive exception lists.
• Market Study Pipeline Requirements: Request to confirm new language doesn't create obligations beyond current practice.
• Preserved Affordability and Income Targeting: Concerns that language could eliminate flexibility to amend restrictive covenants during recapitalization.
• Syndicator Asset Management Fee Cap: Questions about implications of $100 per unit cap for smaller developments where standard fees may exceed the cap.

OHC's Letter to OHFA