Picking a credit program and competition bucket — Arkansas

What you are actually choosing

The Arkansas Development Finance Authority (ADFA) is the state's sole housing credit agency and its sole multifamily bond issuer — one Board of Directors runs both programs off one Multifamily Housing Application (MFHA), unlike California's CTCAC/CDLAC split or Texas's TDHCA/Bond Review Board split. 9% credits are rationed by the fixed federal per-capita ceiling in one competitive round a year. 4% credits ride along with tax-exempt private activity bonds, and the bonds are reserved strictly in the order complete applications are received — not scored, not drawn by lottery.

One vintage warning before citing anything here: the QAP that governed the 2026 round — application deadline February 2026, awards approved that May — was Board-adopted and signed on August 21, 2025. ADFA has since posted a 2027 QAP for public comment (June–August 2026), but the copy fetched this session still carries a blank, unsigned Board-adoption block. Several dollar figures already moved between the two versions; treat the 2027 numbers below as proposed, not adopted, until confirmed against a signed copy.

The 2026 federal break, and how Arkansas responded — barely

The same federal change hit every state: the One Big Beautiful Bill Act (P.L. 119-21) § 70422(b), amending 26 U.S.C. § 42(h)(4)(B), added a second path that waives the 9%-competitive requirement for 4% deals — 50% of a building's aggregate basis (building plus land) bond-financed, or 25% bond-financed if at least one bond issue dated after December 31, 2025 itself finances 5% of that basis. California reacted by capping every bond award at 30–40% of aggregate basis specifically to stop deals from gaming the new lower floor. Arkansas's currently-adopted 2026 QAP contains no comparable provision at all — it is silent on the 25%/50% test entirely.

The posted 2027 QAP adds one new clause that wasn't in the 2026 plan: "ADFA will allocate multifamily Private Activity Bonds to 4% LIHTC transactions in an amount equal to the greater of: 30% of the sum of the aggregate eligible basis and land; or, Supportable permanent debt as determined by ADFA underwriting." That's a sizing floor, not a cap the way California's is — it sets a minimum bond request (30% of basis, comfortably above the federal 25% test) rather than capping how large one can get. If it survives adoption, a 2027-round Arkansas bond deal would be sized to at least 30% of basis by ADFA policy regardless of what the federal test technically requires; a 2026-round deal was not bound by it.

The state 9% ceiling itself grew the same way it did everywhere: 26 U.S.C. § 42(h)(3)(I), as amended by § 70422(a), multiplies the state housing credit ceiling by 1.12 for years after 2025 — that's federal law and applies to Arkansas's ceiling with no state-level opt-out. Applying the Rev. Proc. 2025-32 formula to the U.S. Census Bureau's July 2025 Arkansas population estimate (3,114,791) computes to roughly $10.6 million — a self-computed figure, not one this session found published by ADFA or the IRS as Arkansas's specific dollar ceiling. It sits well below the $13,333,900 the 2026 round actually awarded and well above the "approximately $9 million" ADFA's own LIHTC program page still advertises, which reads like copy that predates the 2026 multiplier increase. None of the three numbers reconcile cleanly with the others in the sources read this session — underwrite against the QAP's own award list for a given year, not the marketing-page estimate.

Points are a gate — and in 2026, almost everyone got through it

A 9% application needs a minimum self-score of 75 points to even apply; 74 or below gets no award, "no exceptions." A 4%/Bond Volume Cap application needs 45. The QAP's own points table leaves "Total Points Possible" blank — summing its twelve positive-scoring categories gives a self-computed ceiling of 99 points (three more categories are deduction-only).

That's the opposite of California's or Texas's field, where the fight is over the last point or two. In Arkansas the practical risk is landing under the 75-point floor or failing ADFA's underwriting — a minimum 1.15 debt coverage ratio, developer-fee caps, and reserve requirements — not being outscored by a rival. A single Non-Compliance finding (up to −20) or a Past Performance deduction (up to −25) is large enough on its own to push a strong raw score under the 75-point line.

The tie-breaker is a list ADFA "would likely use" — not a formula

Where California computes a tiebreaker to three decimal places and Texas sums straight-line distances to the nearest park and library, Arkansas's own text is explicitly non-binding: "In the event there is a tie in scoring for two or more Applications, the following are tie-breaker criteria ADFA would likely use, but not exclusively of others." That sentence is identical, word for word, in both the signed 2026 QAP and the posted 2027 QAP — it isn't a one-year quirk.

Practically: a developer can compute a self-score against the published point table, but cannot compute a ranking position at a tie the way a California or Texas applicant can from the regulation text alone — the tie-breaker is a list of considerations ADFA says it will "likely" apply, not a formula that resolves to a number.

Bucket election: there isn't one, except inside the state credit

There are no geographic regions, no rural set-aside, no at-risk or special-needs set-aside beyond the federal 10% nonprofit minimum (IRC § 42(h)(5), QAP § III(B)). It's a single statewide competition, one annual round — genuinely simpler than California's eleven geographic apportionments and four set-asides, or Texas's 26 subregions and three set-asides.

The one place Arkansas does sort applicants into a priority order is its own state Low-Income Housing Tax Credit — Ark. Code Ann. § 26-51-1702 — equal to 20% of the allocated federal amount, capped at $250,000 total across all recipients in a taxable year, and available only to 9% applications (the QAP allocates it "to the highest scoring 9% LIHTC applications"; nothing in the sources read this session extends it to a 4%/bond deal).

In practice the $250,000 cap is thin and concentrated, not spread: ADFA's own 2026 award list shows the entire state-credit award — $246,400, 98.6% of the statutory cap — went to a single development (Mountain Home Senior Estates / Mountain Home Housing Partners, LP, a nonprofit-sponsored senior project in Baxter County), not divided across the 12 funded 9% developments. It's a meaningful add-on for whichever single deal lands it, and zero for the other eleven — worth checking ADFA's priority order (tier, QCT, no-recent-award county) rather than budgeting it as a per-project trickle.

The 4% side: a date-order queue, gated by the same QAP scoring

Arkansas's bond-volume-cap rule (adopted under Ark. Code Ann. § 15-5-318 and §§ 15-5-601–15-5-610) runs on Priority Numbers, not scores or a lottery: the President of ADFA assigns a sequential Priority Number to each completed Application for Reservation of Volume Cap in the order received, and reservations are made in that order. But a Multifamily Housing Bond applicant can't even file that application until its MFHA has cleared the Staff Housing Review Committee, the Board Housing Review Committee, and the full Board of Directors — the same 45-point minimum self-score and underwriting gate that governs every 9% deal applies to a 4% deal too.

Once reserved, Affected Bonds must be issued within the 60-calendar-day Reservation Period (extendable in writing by the ADFA President), except a reservation issued on or after November 1 always expires December 31 regardless of any extension. Separately, a 4%/Bond MFHA itself expires — if it isn't approved by ADFA's Staff and Board Housing Review Committees within 6 months of submission, it's rejected outright and removed from processing.

Calendar, cost of entry, and what moved between QAP years

Developer fee is capped at 10% of Net Development Costs for a 9%/annual-ceiling deal, versus 12.5% for a bond-financed (4%) deal — one of the few places the QAP explicitly rewards choosing the bond path. Up to 50% of the maximum fee may be deferred, payable by the earlier of the 15-year compliance period's end or the equity investor's own deadline.

Phasing limits, and what these sources do not say

ADFA will not award LIHTCs to multiple phases of the same overall development submitted in one funding cycle without an approved waiver request filed before the application deadline (a senior development adjacent to a family development is not treated as a phase of the same development). That cuts directly against California's documented tactic of splitting a large project into phases to lift a tiebreaker's size factor — nothing in the Arkansas QAP, the Multifamily Housing Application Guidelines, or the Volume Cap Rule describes a comparable 9%/4% hybrid or phasing strategy. Treat 9% and 4% as sequential, standalone elections in Arkansas, not a structure to blend.

Two citation-hygiene notes for anyone building on this phase later. First, the QAP's own text cites the volume-cap program's authorizing legislation as "Act 1004 of 2001," while the Volume Cap Rule's own repeal clause cites "Act 1044 of 2001" for the prior rule it replaces — this session could not resolve which Act number is correct from the documents fetched, so cite the codified statute (Ark. Code Ann. §§ 15-5-601–15-5-610, § 15-5-318) rather than either Act number. Second, this session could not locate a published tally of Arkansas's actual 2025 or 2026 multifamily bond volume-cap reservations — the 4% side's real usage, as opposed to its statutory 10%-of-70% share, is an open question for a future update.