Compliance, Year 15, and Guam's 30-year floor — Guam

The floor is 30 years, confirmed against GHURA's own text -- not 55

GHURA's QAP states its "Term of Compliance" rule in a single, unambiguous sentence, repeated in materially identical form in both the 2024 and 2025 QAP: "Projects receiving a LIHTC allocation after January 1, 1990, must comply with eligibility requirements for the extended use period [initial 15-year period (compliance period), in addition to the 15 or more years (extended use period)] determined by elections indicated in the Restrictive Covenant Document. The Restrictive Covenant Document must be recorded before credits are allocated." That is a direct restatement of the federal floor under IRC §42(h)(6)(D) -- 15 years of compliance plus a minimum 15 more years of extended use, for 30 years total -- not a Guam-specific enhancement of it.

Because Criteria 8 is a scoring category, not a fixed program rule, a specific Guam LIHTC property's real total restriction period is whatever its own winning application elected -- 30, 45, or 61-plus years -- and that can only be confirmed against the specific project's recorded covenant, not assumed from the QAP's floor language alone.

Four different names, apparently one document -- and a Qualified Contract fee with no defined process behind it

GHURA's QAP refers to what appears to be the same recorded extended-use restriction by at least four different names across its own text: "Restrictive Covenant Document" (Term of Compliance), "Declaration of Restrictive Covenants for Low Income Housing Credit" (Extended Use Period, effective-date language), "Declaration of Land Use Restrictive Covenants for Low-Income Housing Credits" (Extended Use Period, Income and Rent Set Aside), and "Extended Housing Commitment" (Appendix 1, income-averaging guidance). The QAP never formally defines any of these terms or confirms they refer to the same instrument. This research treats that as a drafting inconsistency worth flagging, not something to resolve by assumption -- confirm the actual name and content of the recorded document against the specific project's own land records.

On exit rights, the QAP's Fees section is the only place either QAP year mentions a Qualified Contract at all: "Qualified Contract Processing Fee: Qualified Contract Fee of $150 per unit for all units." There is no accompanying eligibility standard, timing rule, pricing formula, or waiver requirement anywhere in either QAP -- a sharp contrast with agencies that either mandate a Qualified Contract waiver in every Declaration or publish a detailed eligibility-determination and request process. Because GHURA's QAP contains no waiver clause, and because IRC §42(h)(6)(E)-(F) gives an extended-use-restricted building a statutory right to request the agency find a buyer at the qualified-contract price beginning in year 14 unless a state agency has required a waiver, the federal exit right may still be live for Guam awards by default -- but that is an inference from the QAP's silence, not a GHURA affirmative statement, and this research did not have access to the actual recorded Restrictive Covenant Document / Extended Housing Commitment to confirm whether a waiver appears there instead. Confirm directly with GHURA's LIHTC office and the specific project's recorded covenant before relying on either a waiver or an open Qualified Contract door.

Neither the 2024 nor 2025 QAP mentions a Right of First Refusal in any form -- not a mandatory nonprofit-set-aside ROFR under IRC §42(i)(7), and not an elective, agency-run ROFR process of the kind several state QAPs publish. If a nonprofit general partner's statutory right of first refusal matters to a Guam deal's exit planning, it will have to come from the federal default and the deal's own partnership documents, not from any GHURA-specific instruction.

Labor standards: not a QAP topic, but Guam's own prevailing-wage statute can reach a LIHTC deal indirectly

Neither the 2024 nor 2025 GHURA QAP mentions Davis-Bacon, prevailing wages, or labor standards of any kind. As a general matter of federal law, the LIHTC program itself does not trigger Davis-Bacon labor standards; that obligation typically arises only when a project layers in other federally covered funding -- HOME funds, CDBG above certain thresholds, Section 8 project-based assistance, Public Housing capital funds, or FHA-insured multifamily financing -- alongside the tax credit. Because this is a construction-period question, it is resolved (or not triggered) well before a property reaches Year 15, and it has no bearing on the extended-use compliance obligations described elsewhere in this phase.

Guam does have its own prevailing-wage statute, and it is worth checking independently of federal Davis-Bacon: 5 GCA §55101(a) requires prevailing-wage specifications in "every contract to which the government of Guam is a party, for construction, alteration, or repair... of public buildings or public works of the government of Guam" -- language that, read alone, would not reach a privately owned LIHTC development. But 5 GCA §55108 goes further, directing the Director of Labor to make regulations for "contractors and subcontractors engaged in the construction, prosecution, completion, or repair of public buildings, public works, or buildings or works financed in whole or in part by loans or grants from the government of Guam." A LIHTC deal that also carries a GHURA loan, a Government of Guam grant, or other GovGuam financing layered into the capital stack could trigger Guam's own prevailing-wage rate-setting under that second provision, independent of whether federal Davis-Bacon applies at all. A LIHTC-only deal with no Government of Guam loan or grant in the financing stack would not appear to be reached by either provision on its face.

Property tax: not exempt -- valued on actual restricted income, not market value (11 GCA §24116)

Guam has no blanket property-tax exemption for LIHTC properties, and this research found no PILOT (payment-in-lieu-of-taxes) mechanism for affordable housing anywhere in Guam statute or GHURA's QAP. What Guam has instead is a dedicated valuation statute: 11 GCA §24116, "Tax Rates Applicable to Property Restricted to the Federal Low-Income Housing Tax Credit or with Deed Restrictions Involving Rental Caps." It states that "the assessed valuation of real property used for residential rental purposes wherein the land is restricted to requirements of the federal low-income housing tax credit (LIHTC) program... shall be determined using the income approach as applied to the actual net operating income, after deducting for reserves required by any federal, state or municipal programs" -- rather than the market/comparable-sales approach used for ordinary property. The statute defines "net operating income" as "the actual or anticipated net income that remains after all operating expenses are deducted from effective gross income, but before mortgage debt service and book depreciation are deducted," and it specifically excludes "federal or local income tax credits, subsidized mortgage financing, or project grants" from counting as income that would otherwise inflate the valuation.

The statute's own worked example shows how this plays out: "if a property generates net operating income of $100,000, then that property would have a taxable value of ($100,000/.0941) = $1,062,699 x 70% (taxes are assessed at 70% of appraised value) = $743,889," with "property taxes for this example property... $743,889 times the applicable millage rate." The 9.41% figure is a capitalization rate the statute sets as a starting point, adjustable by the Guam Legislature (I Liheslaturan Guahan) "based on demonstrable changes in actual market conditions." Worth flagging on its own terms: the statute's example applies a 70%-of-appraised-value assessment ratio to tax-credit property, which is lower than the Real Property Tax Law's general definition of "cash value" as "ninety percent (90%) of the appraised value" (11 GCA §24102(f)) that applies to ordinary property -- a real, independently confirmable difference drawn directly from the statute's own text, not an inference.

This is a valuation method, not an exemption -- a Guam LIHTC property still pays real property tax, computed off a formula tied to its actual restricted income rather than an open-market appraisal, and the Director of Revenue and Taxation is required to report annually to the Governor and the Speaker of the Legislature on the program's impact on property tax collections.

Post-Year-15 compliance mechanics: what carries over and what stops

GHURA's QAP describes the shift at Year 15 in its own terms: "After the initial 15-year compliance period is the Extended Use Period, GHURA is no longer required to report instances of non-compliance to the IRS. Compliance during the Extended Use Period (EU Compliance Policy) will concentrate on enforcing the requirements of the LIHTC program through the term of the Declaration of Restrictive Covenants for Low Income Housing Credit recorded on the property... Unless noted below, the policy and procedure for compliance during the initial compliance period shall continue to apply to the extended use period."

The compliance monitoring fee itself does not appear to change or stop at Year 15. GHURA's Fees section states: "A compliance monitoring fee of up to $50 per unit for all units (for the 1st year full inspection) and $25 per unit for all units (once every 3 years after 1st year full inspection) within each project shall be charged annually for administrative expenses. This fee shall be submitted with the LIHTC Annual Report for each year of the compliance/extended-use period." That phrase -- "each year of the compliance/extended-use period" -- reads as a recurring, annually-submitted charge that continues through the full extended-use term, not a one-time payment scoped to the first 15 years the way some other agencies structure their fee. GHURA reserves the right to adjust the fee amount each January 1.