Picking a credit program and competition bucket — Kansas

What you are actually choosing

Kansas Housing Resources Corporation (KHRC) — codified at K.S.A. 74-8901 et seq. — is the sole state housing finance agency here. Unlike states that split the competitive credit and the bond-financed credit across two separate agencies, KHRC administers both 9% and 4% LIHTC itself, in the same Qualified Allocation Plan (QAP). There is no separate bond-allocation committee analogous to CDLAC or a lottery agency analogous to Texas's bond program — but that also means the QAP itself is silent on how Kansas's overall federal private-activity-bond volume cap (26 U.S.C. § 146(d)) gets divided up; a 4% applicant arranges its own bond issuer (a city, county, or other conduit issuer) separately from the LIHTC application to KHRC.

Federal law sits underneath both: a 4% deal still has to clear the aggregate-basis bond-financing test at 26 U.S.C. § 42(h)(4)(B) — at least 50% of aggregate depreciable-plus-land basis financed with tax-exempt bonds, or, for bonds issued after December 31, 2025, an alternative 25% path (as added by P.L. 119-21 § 70422(b)) if a post-2025 bond issue itself finances at least 5% of aggregate basis. That test is identical in every state; nothing in the Kansas QAP modifies it.

The state credit is what actually separates the two programs

House Bill 2289, enacted by the 2025-2026 Kansas Legislature and signed by the Governor on April 24, 2025 under the short title "Limiting and discontinuing the Kansas affordable housing tax credit and expanding transferability of Kansas housing investor tax credits," rewrote the Kansas Affordable Housing Tax Credit Act (K.S.A. 79-32,304 – 79-32,309). The 2026 QAP states the result plainly: the State LIHTC is capped at $8,800,000 total for the year and is no longer available to any development receiving 4% federal credit — it now matches 9% awards only, dollar-for-dollar, under K.S.A. 79-32,306(a).

That is not a marginal difference — it roughly doubles the annual credit a maxed-out 9% deal can reserve compared to an identically sized 4% deal, before either project's equity pricing is applied. A developer choosing 4% for its speed and as-of-right federal credit is also affirmatively walking away from the state match, not just skipping a competition.

Two point systems, and the real gate isn't where it looks

Every application — rehab or new construction, 9% or 4% — has to clear a statutory scoring floor before KHRC's own selection criteria matter at all. K.A.R. 110-10-1 mandates seven categories, reproduced in QAP Appendix A, each scored all-or-nothing with no partial credit.

Separately, KHRC's own Selection Criteria (QAP § VII) apply a numeric preliminary threshold — but only to new construction, and only as a minimum to be invited to submit a full application: 33 points for 9%, 55 points for 4%. Rehabilitation proposals of either credit type skip this entirely; they're desk-reviewed under Section VI's qualitative priority list (more rehab work needed, resyndications past year 22, project-based rental assistance depth, hard-cost ratio, local revitalization need, owner experience) with no point score at all.

The 33-point preliminary bar for 9% new construction is a low fraction of what's actually scoreable — a meaningful chunk of the point categories aren't even evaluated until the full application. Quality Site (up to 5), Below-Market Loans and Support (up to 30), Senior Housing with Services or Family Housing (up to 10), and Deeper Affordability or Homeownership (up to 20) total 65 points that don't factor into the preliminary invitation at all. Clearing 33 points to get invited says very little about where an application will actually land once those categories are scored.

The tiebreaker is discretion, not a formula

This is the sharpest contrast with states that publish a mathematical tiebreaker: Kansas doesn't have one. QAP § VII(L) says that when two applications tie and there isn't enough credit for both, KHRC decides based on which site is the best location for the households served, which has committed to higher energy standards, which requested the lower amount of LIHTC, and which has the highest percentage of 30%-AMI-or-less units — all in KHRC's discretion. It applies only to 9% proposals, only at the full-application stage.

There is no ratio to compute, no percentage to self-score, and no published worksheet. The factors reward roughly the behavior a formula-based tiebreaker would reward elsewhere — a lower credit ask, deeper income targeting, a better site — but an applicant can't pre-calculate a rank the way a CDLAC or TDHCA tiebreaker formula allows. Treat any internal estimate of competitive standing on a tie as a guess about KHRC's judgment, not a number.

Bucket election, and how soft the doors actually are

9% credit is divided among several set-asides before the General set-aside absorbs whatever's left.

Two structural caps sit alongside the set-asides regardless of bucket: no more than two 9% new-construction awards per Rural County and no more than three per Metropolitan County in a round, and no Principal may receive more than two 9% awards in a round (QAP § III(A)(2)-(3)).

Program election follows the Principal, not just the deal

"Principal" reaches past the named Applicant to anyone listed as developer, any member or partner of the eventual ownership entity, anyone taking more than 10% of the developer fee for consulting or a guarantee, and their immediate family. A Principal capped at two 9% awards per round is also capped at two 4% awards per calendar year — separately, since 4% runs on its own rolling clock (QAP §§ III(A)(2), IV).

Penalties follow the Principal across both programs, not just the credit type where the problem happened — the selection-criteria chart marks Penalties applicable to both 9% and 4%. KHRC may deduct up to 10 points for housing-development issues (missed post-award reporting, a post-September-2022 qualified-contract request, missed design/accessibility/energy standards on 2020-or-later construction starts, funding or bond-issuance increases past the allowed threshold, late cost certification) and up to 20 more for housing-compliance issues — 5 points each for an unreported management or ownership change, a LURA violation, a chronically unfunded replacement reserve, or persistent noncompliance.

A Principal with no Kansas LIHTC award before January 1, 2023 is limited to one project until it closes, and a third application won't be awarded until the first has a complete cost certification submitted — a real constraint on new-to-Kansas developers trying to run more than one deal at a time through either program.

Calendar, fees, and what the deal actually costs to run

4% has no equivalent calendar — applications are accepted on a rolling basis year-round, reviewed within about 60 days of a complete submission. Applicants seeking both 9% and 4% credit on one deal must submit with the 9% round and follow all 9% requirements; there's no separate hybrid intake.

Developer fee is capped differently by project type and size, not by credit program: new construction runs $22,000 per unit for projects of 50 units or fewer, $19,800 for 51-149 units, and $16,500 for 150 or more (QAP § VIII(C)(1)); rehabilitation is the greater of the minimum $40,000 or 20% of eligible basis net of fees and acquisition costs, plus 5% of the existing structures' purchase price (QAP § VIII(B)(1)-(2)). DDA and QCT sites get an automatic 30% eligible-basis boost; other 9% applicants can request a discretionary KHRC-defined boost under IRC Section 42 (QAP § VIII(A)(8)).

4% carries its own geographic cooldown: KHRC won't award a new-construction 4% development within 1.5 miles of another 4% new-construction award for one year after that award — unless it's a planned second or third phase within .25 miles of the prior phase with demonstrated need (QAP § IV(A)). HUD Resources (HOME and NHTF) are governed by the same QAP Section II that covers 4% and Bonds, and the 2026 QAP doesn't state a blanket bar on combining them with 4% LIHTC — KHRC's application calendar simply packages the HUD Resources cycle with the 9% round, with no parallel annual HUD Resources deadline published for the rolling 4% process.

Hybrid, and what KHRC's QAP actually says

Kansas doesn't publish a separate hybrid mechanism the way some states do. The QAP's entire instruction on combining credit types is one sentence: applicants seeking both 9% and 4% LIHTCs on one deal submit with the 9% competitive round and follow all 9% requirements. There's no documented size-factor boost, no published combined-fee schedule beyond the standard fee table, and no separate hybrid application track.

What that means in practice: a hybrid structure in Kansas is a 9% application with a bond-financed phase or component layered in through structuring, not a distinct competitive bucket with its own rules. Since the state credit is now 9%-exclusive under House Bill 2289, any 4%-financed piece of a hybrid deal gets federal credit only — the same asymmetry that governs a standalone 4% deal. Treat the combined structure as a question for bond counsel and the syndicator, not something the QAP itself works out for you.