Compliance, Year 15, and the 55-year tail — Ohio

Ohio's real extended-use math — and why the qualified-contract exit is largely closed

OHFA's own LIHTC Compliance Manual lays the timeline out directly: a 10-year credit period, a 15-year compliance period (the credit period plus five years, per IRC §42(i)(1)), and an extended use period of "a minimum of 15 years in addition to the 15-year compliance period," for a total 30-year affordability term. The recorded instrument is a minimum 30-year Extended Use Agreement in the form of a restrictive covenant, per 26 U.S.C. §42(h)(6) — confirm the actual term on the specific project's recorded LURA rather than assuming a round number, since some other states' regulatory agreements do run considerably longer.

Both the 9% LIHTC QAP (PY2026-2027) and the 4% LIHTC QAP (effective March 19, 2025) contain identical language on the qualified-contract question: "OHFA requires all LIHTC development teams to waive the right of the owner to petition OHFA to have the extended use period terminated as described in 26 U.S.C. §42(h)(6)(F)." That's not a soft discouragement — it's a mandatory waiver of the statutory qualified-contract mechanism, signed as a condition of receiving the allocation. For any deal awarded under a current-era QAP, the federal default "request a qualified contract at Year 15 and force a sale or termination" option doesn't exist; it was waived at closing.

What's actually left of the Year-15 exit, and what follows a termination

OHFA still operates a Qualified Contract Listing process for older allocations that predate the waiver requirement: once an owner properly requests it, OHFA lists the property for a one-year period during which the owner may accept any offer at or above the posted qualified contract price from a buyer who agrees to maintain the existing low-income restrictions. As of the current listing, OHFA shows no properties actively requesting a qualified contract sale — consistent with how few pre-waiver deals remain unexpired and willing to test the process.

Whatever ends an Extended Use Agreement — a completed qualified contract release or a foreclosure — doesn't immediately free the property from tenant protections. OHFA's Compliance Manual defines a "Decontrol Period": the three-year window following termination during which existing low-income households keep a prohibition against eviction (except for good cause) and against rent increases beyond what Section 42 would have allowed. Model that three-year tail into any Year-15 disposition timeline, not just the termination date itself.

On right of first refusal: OHFA's QAPs and Compliance Manual don't establish a standardized, program-level ROFR mechanism for 9%/4% LIHTC deals. The federal enabling provision — 26 U.S.C. §42(i)(7), which lets a for-profit owner grant a qualified nonprofit or governmental purchaser (or in some structures the tenant) an option to buy at a statutory minimum price without that grant itself triggering recapture — is available to any Ohio deal, but whether and how it's used is a partnership-agreement and LURA-level negotiation, not something OHFA centrally mandates or standardizes the pricing for. Don't assume a specific Ohio deal has a ROFR unless it's actually written into that deal's own documents.

The long tail: what keeps recurring, and what's one-and-done

The $2,550-per-unit Compliance Monitoring Fee covered in Phase 10 is, per OHFA's own fee schedule, due once — "with IRS Form 8609 request" — not an annual or recurring charge through the compliance period or the extended use period. The real recurring costs through the 30-year tail are independently prepared financial statements (audited for projects with 50 or more units, reviewable-level for smaller projects once in extended use) and ordinary management-company compliance work, not a per-unit fee paid to OHFA itself.

Reporting genuinely steps down once a project enters its extended use period: full annual income recertification and student-status certification are no longer required (student status still has to be verified at every new move-in), but owners still complete an annual Extended Use AOC, still log rental activity and unit turnover in OHFA's database, and still undergo annual unit inspections. A management company that keeps running full TIC/income recerts on an extended-use project past Year 15 is spending money and compliance risk on paperwork OHFA doesn't require.

OHFA's Compliance Manual also names the two real end-states for a project that's finishing its extended use period: an owner can apply for a brand-new LIHTC allocation during the existing extended use period to refinance and recapitalize the deal ("resyndication"), keeping affordability restrictions running past year 30; if the extended use period completes before a new allocation is secured, the project instead falls into what OHFA calls "reallocation" — a fresh award after the original restrictions have already lapsed.

Property tax at the back end: CRA is the real lever, the charitable exemption is not a sure thing

None of this LIHTC-specific mechanics touches property tax — Ohio real property is presumptively taxable, and a LIHTC award doesn't create an exemption on its own. The primary route developers pursue is the Community Reinvestment Area (CRA) program under Ohio Revised Code §§3735.65–3735.70: a local-option abatement, adopted city-by-city or county-by-county, on the increased assessed value from new construction or substantial remodeling. ORC §3735.66 governs the local resolution and housing-officer designation; §3735.67 governs the exemption application itself, which is filed with that local housing officer, who verifies the construction facts and then performs required annual inspections of every property holding an exemption under that section.

Columbus's own CRA policy (City Code Ch. 4565) is a concrete, real example of a municipality conditioning abatement on LIHTC-style affordability: up to 100% abatement of the increased assessed value for 15 years for a project reserving at least 10% of units at or below 60% AMI plus 10% more at or below 80% AMI (or, alternatively, widening to 30% of units at or below 80% AMI). Columbus recently streamlined this further — a 2025 ordinance added a citywide CRA option letting a multifamily project pay a one-time fee in lieu of the affordability set-aside and skip the individual tax-incentive agreement entirely. Every municipality's CRA terms differ; confirm the local policy rather than importing Columbus's numbers elsewhere in the state.

A second potential basis, the charitable-use property tax exemption under ORC §5709.12(B) and §5709.121, is sometimes pursued on nonprofit-sponsored deals, but its fit for LIHTC rental housing specifically remains genuinely unresolved. Most LIHTC ownership entities are for-profit limited partnerships even where a nonprofit serves as general partner, and the statute's "exclusive charitable purpose, without seeking profit" standard is a real, open question against that ownership structure — treat this as an uncertain, unconfirmed route rather than a reliable backup to CRA.