Construction, prevailing wage, and the path to Form 8609 — Massachusetts

Two agencies, two rulebooks: EOHLC allocates and signs off on 8609s; MassHousing and MassDevelopment underwrite the bond-financed 4% deals

EOHLC's own program page states its role without qualification: “In Massachusetts, the Executive Office of Housing and Livable Communities (EOHLC) is the allocating agency for tax credits. EOHLC is responsible for preparing the annual allocation plan and making it available for review.” EOHLC is the successor to the Department of Housing and Community Development (DHCD) — the agency was folded into a new, cabinet-level Executive Office of Housing and Livable Communities as part of Governor Healey's 2023 Article 87 reorganization. That rename matters for anyone reading older program documents literally: EOHLC's own QAP still refers to “then-DHCD” when describing pre-2023 policy history, and at least one of the agency's own current downloadable forms — the Low Income Housing Tax Credit Cost Certification Format, last modified December 2017 — still identifies the reviewing agency as “Department of Housing and Community Development” and “DHCD” throughout its sample independent auditor's report. Both names refer to the same agency today; EOHLC has not represented that it reissued every legacy template after the rename.

The QAP's own language on the 4% program draws the second agency into the picture directly: 4% credits are “allocated by HLC [EOHLC]” but their availability “is tied directly to the availability of tax-exempt financing at MassHousing and MassDevelopment,” which in turn depends on annual private-activity volume cap apportioned by the Executive Office of Administration and Finance. In practice this means EOHLC remains the LIHTC allocating and compliance-monitoring agency of record for every Massachusetts tax-credit project — 9% or 4% — while MassHousing (MHFA) and MassDevelopment (MDFA) act as the bond issuers and, for the buildings they finance, run their own parallel underwriting, design-review, and asset-management relationship with the owner. EOHLC's compliance-monitoring procedure explicitly contemplates leaning on that second relationship: for any building where at least 50% of the aggregate basis is financed with tax-exempt bond proceeds administered by MHFA or MDFA, EOHLC's own monitoring appendix says it “may assume the accuracy of” income and rent information supplied by MHFA or MDFA under a data-sharing agreement, rather than independently re-verifying every tenant file itself.

Design and accessibility: 521 CMR on top of the Fair Housing Act, Section 504, and the ADA — and EOHLC just doubled its own floor

The QAP's own accessibility section requires compliance with “the requirements of the Massachusetts Architectural Access Board (MAAB)” in addition to “other applicable federal, state, and local statutes and regulations such as the Fair Housing Act (FHA), Section 504 of the Rehabilitation Act of 1973, the Architectural Barriers Act of 1968 (ABA), and the Americans with Disabilities Act (ADA),” with the more stringent standard controlling wherever the codes conflict. MassHousing's own accessibility policy — last revised December 2004 but still the live document on MassHousing's Developer Library — states the same stacking rule in more specific terms and gives the exact regulatory citation: “All developments financed by [] MassHousing must comply with the accessibility requirements set forth in the Massachusetts Architectural Access Board (AAB) regulations (521 C.M.R. 3.00 et seq.) and Title II of the Americans with Disabilities Act (ADA) regulations,” with Section 504 layered on top only for developments that receive federal financial assistance — and the same document is explicit that Section 504 is not automatically triggered by tax credits alone: developments receiving federal assistance “(except tax credits or tenant-based vouchers)” are the ones that must separately comply with Section 504. A tax-credit-only Massachusetts deal with no other federal subsidy layered in is therefore governed by 521 CMR, the FHA, and the ADA — not automatically by Section 504's UFAS standard as well.

Two more Massachusetts-specific design requirements sit outside the accessibility code but land in the same part of the process. First, Visitability: EOHLC's Appendix K requires every unit in an elevatored building and every ground-floor unit in new construction or adaptive re-use — including multi-story townhouse units — to meet a defined “Visitable Unit” standard (a step-free route from a public way, 32″ minimum clear door widths, and a clear path to a bathroom and living area), which is deliberately not the same test as an AAB or ADA “accessible route.” For Community-Based Housing (CBH) units specifically, EOHLC's guidelines go further still, citing 521 CMR 24.2's ramp-slope rule directly (“Ramps shall have the least possible slope”) and recommending CBH units run roughly 20% larger than HLC's standard minimum unit sizes to accommodate mobility equipment and caregivers. Second, lead paint: EOHLC's QAP states flatly that “all units in all tax credit buildings must be de-leaded prior to the issuance of a final allocation (IRS Form(s) 8609)” for the project, citing M.G.L. c.111, §§190-199B and 105 CMR 460.000 alongside EPA requirements — a hard gate on 8609 issuance that has nothing to do with Section 42 itself.

Construction-period labor compliance: EOHLC's Responsible Contractor Guidance, certified payrolls, and the real prevailing-wage split between DLS and the Attorney General

Massachusetts's general prevailing wage statute is commonly cited as M.G.L. c.149, §§26-27H, and the state's own description of the law splits two functions between two different agencies: the Department of Labor Standards (DLS) issues the Prevailing Wage Rate Sheets that set the actual wage schedule for a given job classification, while the Attorney General's Fair Labor Division is the office that enforces the law — investigating complaints, pursuing civil and criminal violations, and maintaining the debarment list of contractors barred from public work. Both roles are real and distinct: DLS answers “what is the rate,” the AGO answers “who didn't pay it.” This research could not find any indication that EOHLC or MassHousing independently verify certified-payroll compliance with DLS rate sheets during construction — that enforcement function belongs to the AGO, not the funding agency.

Whether c.149's prevailing-wage rate schedule itself actually attaches to a given LIHTC job site is a separate, narrower question, and EOHLC's own construction-period policy document — the “Responsible Contractor Guidance,” effective for projects awarded on or after January 1, 2025 and applicable to both federal and Massachusetts state LIHTC projects — is careful not to assume it does. The Guidance requires every contractor to certify that it will “follow all applicable wage and hour laws (including G.L. c. 151, §1, G.L. c. 149, §148, and, only where applicable, G.L. c. 149, §§26-27D)” — the qualifier “only where applicable” is EOHLC's own language, and the specific pinpoint citation given is §§26-27D, narrower than the §§26-27H range commonly used to describe the statute as a whole. This research could not confirm from the QAP text alone exactly which trigger (a public awarding authority as a contracting party, public land, or another statutory hook) makes c.149's rate schedule applicable to a privately-owned LIHTC development as opposed to the wage-and-hour and Wage Act provisions that apply regardless — that determination should be confirmed directly with DLS or the AGO's Fair Labor Division for a specific deal structure, not assumed from the QAP alone.

Independent of whether the narrower prevailing-wage rate schedule technically applies, EOHLC's Responsible Contractor Guidance imposes a documentation regime on every contractor and subcontractor on every covered project (LIHTC, HOME, ARPA, and several other EOHLC-funded programs are all listed in the Guidance's own Appendix A): a signed Certificate of Compliance before starting work; a check against five separate debarment lists (the AGO's own debarment list and civil-enforcement listing, the Division of Capital Asset Management and Maintenance's debarred-contractor list, the Department of Industrial Accidents' debarment list, and the federal excluded-parties list); OSHA-10 cards for every worker within two weeks of starting; daily sign-in/sign-out sheets; and “certified payrolls for all employees based on their normal payroll schedule, whether weekly or biweekly.” All of this documentation must be retained by the project owner for three years after final completion and made available to EOHLC, the AGO, and the U.S. Department of Labor on request — a compliance-documentation duty EOHLC places on the owner directly, rather than verifying itself during construction.

Cost certification and the release of Form 8609

EOHLC requires two separate cost-certification steps. First, the general contractor — not just the owner — “must submit an independent cost certification to HLC following the completion of construction,” per the QAP's contractor-evaluation section. Second, and separately, when the project places in service, “HLC requires an audited cost certification in its established format,” and “the IRS Form 8609(s) will not be released to the project owner until the final analysis is completed by HLC” — EOHLC may reduce the final allocation shown on the 8609 if the project lacks sufficient basis or if costs are not acceptable to the agency. EOHLC's own Final Cost Certification template (last modified December 2017, and still captioned to the pre-2023 “Department of Housing and Community Development” name) spells out the required audit opinion in full: “We conducted our audit in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the Final Cost Certification is free of material misstatement... The accompanying Final Cost Certification was prepared in conformity with the accounting practices prescribed by the Internal Revenue Service, under the accrual method of accounting, and in conformity with the format and qualified allocation plan rules set by DHCD, which is a comprehensive basis of accounting other than generally accepted accounting principles.” That is a full GAAS audit opinion on a special (OCBOA) basis of accounting — not a compilation or a review — delivered by an accountant who must also represent having “no financial interest in the Project other than in the practice of our profession.”

Developer's fee and overhead is checked at the same three checkpoints EOHLC uses for basis generally — application, carryover allocation, and the Form 8609 request — and any excess over the QAP's allowable percentages (5% of acquisition costs, tiered percentages of total replacement costs above that, per the fee schedule in effect since the 2018 QAP) reduces the credit allocation at whichever checkpoint catches it. This research did not find QAP language addressing whether EOHLC issues Form 8609 building-by-building for a multi-building project as each building is separately placed in service, or waits for the full project's cost certification and Final Allocation Application — unlike some other states' QAPs, Massachusetts's does not appear to address that sequencing question explicitly in the public document; confirm directly with EOHLC for a specific multi-building deal.