Choosing 9%, 4%, or neither — Ohio

The 9% round: a 100-point formula that has nothing to do with the tiebreakers

OHFA's 2026-2027 9% LIHTC QAP scores every Proposal Application on three weighted criteria that sum to 100 points: a Neighborhood Opportunity Index (40 points, 40%), a Housing Needs Index (35 points, 35%), and the Annual LIHTC Request per LIHTC Unit (25 points, 25%). The first two are census-tract measures built with the Urban Institute and auto-calculated in OHFA's application workbook (the AHFA) from each site's address — a sponsor doesn't compute them, but does choose the site that scores well on them. The third is the only criterion a sponsor directly controls: requesting less credit per unit buys points.

OHFA board-approved a Technical Amendment to this QAP on August 20, 2026 that reset the Annual LIHTC Request per Unit thresholds (they reindex annually to the Multifamily Residential Construction Index). A request of $29,500 or less in annual 9% LIHTC per unit earns the full 25 points; points decline on a straight line to zero at $51,000 or more, per the formula OHFA publishes directly in the QAP: =MAX(0, MIN(25, ((51,000 − Annual LIHTC Request per Unit) / 21,500) × 25)). The prior thresholds — $27,935 and $48,252 — appear in the original PY2026-2027 QAP text the Technical Amendment superseded; use the amended figures for any 2026-2027 round application.

Credits are awarded within four funding pools, each competing against itself rather than against the whole state: New Affordability – General Occupancy (39% of the annual 9% ceiling), New Affordability – Seniors (26%), Preserved Affordability (13%), and Tenant Populations with Special Housing Needs (22%). A project must first clear its pool's threshold requirements — for the two New Affordability pools, that includes an Extremely Low-Income (ELI) unit requirement: 15% of units at or below 30% AMI if the site's census tract has a Housing Needs Index raw score of 45 or below, or only 10% if the tract scores above 45 — before its 100-point score is ever compared to anyone else's.

The tiebreaker lists inside each pool are a genuinely separate competition from scoring. They reuse the raw, unweighted Neighborhood Opportunity and Housing Needs Index values (not the weighted points that decided the scoring round) alongside factors like census-tract award recency, bedroom count, unit count, historic-tax-credit use, and ELI percentage — and none of the four pools' tiebreaker lists reference the Annual LIHTC Request per Unit criterion at all. A sponsor who wins on price-per-unit and loses on score, or vice versa, is navigating two different rubrics, not one.

The 4% track: rolling applications, an uncapped developer fee dollar limit, and a bond volume-cap gamble

The 4% program runs under its own 4% LIHTC Qualified Allocation Plan (effective March 19, 2025), a genuinely different document from the 9% QAP — non-competitive, no 100-point rubric, no per-capita credit ceiling. A '4% LIHTC Only' application (no OHFA gap financing layered in) is accepted on a rolling, first-come-first-served basis once Experience and Capacity Review opens each February.

The tradeoff is structural, not administrative: to claim the full 4% credit, at least 50% of a project's aggregate basis must be funded with tax-exempt §142(d) private activity bonds (PABs) per 26 U.S.C. §42(h)(4)(B) — fall short of 50% and the credit pro-rates down on the shortfall, cutting the resulting allocation by more than half in a typical structure. OHFA's own QAP illustrates the gap on a $15 million basis project: a 9% deal generates roughly $1,350,000 in annual credit against $600,000 for an equivalent 4% deal — about 72% of total development cost funded by LIHTC equity on the 9% side versus 32% on the 4% side, with the difference made up elsewhere in the capital stack.

PABs are themselves scarce. Ohio's total annual state private-activity-bond volume cap is administered by the Ohio Department of Development under OAC Chapter 122-4, but the slice actually available to residential rental projects is narrower: the lesser of $120 million or 15% of the state's total ceiling is set aside for residential rental under OAC 122-4-02. Unused cap carries forward three calendar years under 26 U.S.C. §142(k)(5)(B)(ii). When that set-aside runs tight in a given year, OHFA prioritizes 4% requests using the federal statutory preferences at 26 U.S.C. §42(m)(1)(B) (serving the lowest-income tenants, longest affordability commitments) and the selection criteria at §42(m)(1)(C) — meaning a 'non-competitive' credit can still function competitively in a volume-cap-constrained year.

There is no published twinning or hybrid mechanism combining 9% and 4% resources on the same deal in either current QAP. The closest thing to a cross-program rule runs the opposite direction: Preserved Affordability projects with more than 70 total units located in a Qualified Census Tract are barred outright from the 9% round unless the sponsor submits a data-supported narrative — at least 60 days before the Proposal Application deadline, with OHFA approval required at least 30 days out — proving the project is infeasible using 4% LIHTC with tax-exempt bonds. In practice, OHFA is pushing larger preservation deals toward 4% by default and requiring an affirmative case to do otherwise.

Fees and the developer-fee ceiling that actually binds

All OHFA application fees — 9%, 4%, and the Bond Gap Financing (BGF) layer that pairs 4% credits with Ohio Housing Trust Fund, National Housing Trust Fund, or HOME gap resources — are non-refundable and must be paid by ACH. OHFA does not accept checks and has no online payment portal; wiring instructions are posted on its File Transfer Site. A 4% deal that also draws BGF gap financing pays BGF's own $2,500 Proposal and $2,500 Final Application fees in addition to the base 4% fees, except that BGF's $2,500 Final Application fee replaces (not stacks on top of) the 4% program's own $3,500 Final Application fee.

Both programs cap the maximum budgeted developer fee — which bundles the Developer Fee itself with application/consultant, construction management, guarantee, developer-charged financing, and developer-charged asset management fees — at 20% of LIHTC eligible basis net of those same fees. Only the 9% program adds a hard $3 million dollar ceiling on top of the percentage; the 4% QAP states no equivalent dollar cap, which matters most on a large bond-financed transaction where 20% of basis would otherwise run well past what a 9% deal could ever collect.

Don't confuse either fee schedule with OHFA's 2026 Additional Credits Policy (also board-approved August 20, 2026) — a narrow $1,450,000 gap-funding pool, capped at $110,000 per project, available only to already-awarded 2022-2025 9% deals facing documented cost overruns before placement in service. Program Year 2026-2027 awardees are explicitly ineligible, and every dollar drawn costs the sponsor's development team 0.1 scoring point per $10,000 requested on every project it submits in the following 9% round. It is a cost-overrun rescue mechanism, not a way to blend 9% and 4% resources.