Program election (9% vs. 4% vs. hybrid) — Rhode Island

Three federal credit paths, one small state, one QAP

RIHousing's QAP describes three credit types in a single paragraph: a 9% annual credit for new construction or substantial rehabilitation; a 4% annual credit for acquisition of an existing building involving substantial rehabilitation, drawn from the same annual per-capita allocation as the 9% credit; and a third, separate 4% credit for new construction or substantial rehabilitation (including acquisition) that is "made available through the issuance of tax-exempt bonds." On top of the two per-capita credits, RIHousing's QAP separately defines a "Hybrid Development": "a hybrid transaction in which a developer seeks both an allocation of 9% LIHTC and a simultaneous financing plan seeking an allocation of tax exempt bonds and 4% Credits." Hybrid Developments are not a casual combination — RIHousing requires the applicant to conform to Program Bulletin 2022-2 and Section 12 of the Developer's Handbook, and evaluates the proposal for scale sufficient to produce "demonstrable savings of resources in exchange for the higher complexity of the execution," the developer's track record executing hybrid structures, and simultaneous financing capacity across both tranches.

Two very different intake processes — and two different fee schedules

The 9% and 4%/bond tracks aren't just scored differently; RIHousing prices them differently too. Both pay the same $1,500 non-refundable application fee and the same tiered underwriting fee (up to $1,000,000 loan amount: $20,000; up to $3,000,000: $25,000; greater than $3,000,000: $35,000), but the LIHTC Allocation Fee charged at closing diverges: 0.5% of the 10-year allocation amount for 9% deals versus 1.0% of the 10-year allocation amount for 4% deals. RIHousing also reserves broad discretion on the 9% side that doesn't have an exact 4% analogue: it may create an official waiting list, limit later competitive rounds to proposals already submitted, award LIHTCs outside a competitive round to projects returning credits or facing unanticipated cost increases or equity-yield shortfalls, and decline an award regardless of score if it finds an over-concentration of projects in one location or production type.

Who actually issues the bonds: RIHousing itself, with volume cap from the state Treasurer's Public Finance Management Board

RIHousing's own QAP never names its bond-issuing authority in Section IV — it just says the 4% credit is "made available through the issuance of tax-exempt bonds." The RI Office of the General Treasurer's Public Finance Management Board (PFMB) resolves this directly in its own Debt Affordability Study: a table of "Quasi-Public Agency Issuers" lists the Rhode Island Housing and Mortgage Finance Corporation (RIHousing) as a Conduit Issuer of "Single-Family and Multi-Family Housing Revenue Bonds." RIHousing's own Board of Commissioners has adopted authorizing resolutions for Multi-Family Development Revenue Bonds directly. This is distinct from the Rhode Island Commerce Corporation, which the same PFMB table shows issuing bonds for GARVEEs, airport revenue, and general economic development (including Rhode Island Industrial Facilities Corporation tax-exempt private activity bond debt) — not multifamily housing. In short: RIHousing is Rhode Island's multifamily housing bond issuer, not Commerce Corporation or the Health and Educational Building Corporation.

Rhode Island's federal private activity bond (PAB) volume cap itself is administered by the PFMB, which the Treasurer's office describes as "the administrating agency for the allocation of Private Activity Bond (PAB) volume under the Code." This research located a December 2024 PFMB action reported to have authorized volume cap allocations of approximately $298.23 million to RIHousing and $80 million to the Rhode Island Student Loan Authority out of the state's 2024 federal PAB ceiling of $378,230,000 — but the original Treasury press release describing that action could not be directly retrieved (the page returned an access block to automated tools), so these specific dollar figures should be treated as a secondary characterization of that release, not a directly-quoted primary source, and re-confirmed for the current allocation year before relying on them.

Rhode Island's new State Low-Income Housing Tax Credit (SLIHTC): real, but young, capped by financing gap rather than a fixed percentage, and time-limited

Rhode Island does have its own state affordable-housing tax credit — the State Low-Income Housing Tax Credit, created by the Low-Income Housing Tax Credit Act, R.I. Gen. Laws § 44-71-1 et seq. (P.L. 2023, ch. 79, art. 6, § 5, effective June 16, 2023). It is not a percentage match to the federal 9% or 4% credit the way some states' "piggyback" state LIHTCs work. Instead, the statute caps the credit at the project's Financing Gap: a taxpayer "may be allowed a Rhode Island low-income housing tax credit ... in an amount authorized, determined, and allocated by the department based on the qualified Rhode Island project's need for the credit for economic feasibility" (§ 44-71-5(a)). A project must already be approved for or have received a federal LIHTC before it can receive SLIHTC (§ 44-71-6; 310-RICR-10-10-1 § 1.6) — it stacks on top of, and after, the federal award, not instead of it.

Critically, SLIHTC is administered by the Rhode Island Department of Housing (defined in the Act as the department established under the now-repealed § 42-64.34-1) — not by RIHousing. The RI Executive Office of Housing's own program page states plainly that SLIHTC "is designed to work alongside the federal Low-Income Housing Tax Credit (LIHTC), including both 4% and 9% credits," is awarded through "a competitive Request for Proposals (RFP) process," pays out "in equal installments over a five-year period after the development is placed in service," and can either be sold to investors or "redeemed directly by the State at 90 percent of their value." The 90% redemption figure and the five-equal-annual-increments structure are both confirmed directly in statute and regulation: § 44-71-5(e) states the state "shall redeem this credit, in whole or in part, for ninety percent (90%) of the value of the tax credit" (subject to annual appropriation), and § 44-71-5(c) sets the credit at "five equal annual increments," carryforward up to four succeeding years if it exceeds the taxpayer's liability in a given year. Like the federal credit, an SLIHTC award requires a Tax Credit Agreement recorded as a 30-year affordable housing deed restriction (§ 44-71-3(10)).

The OBBBA 25% bond-financing test: not addressed anywhere in RIHousing's own materials

A tax-exempt bond-financed 4% deal must independently satisfy the federal aggregate-basis test under IRC § 42(h)(4)(B): historically, at least 50% of a project's aggregate basis had to be tax-exempt-bond financed, and the One Big Beautiful Bill Act (Pub. L. 119-21, § 70422(b)(1), 2025) added a more favorable 25% alternative for bonds issued after December 31, 2025 (with at least 5% of aggregate basis financed by those newer bonds). A direct text search of RIHousing's 2026 QAP, its 2026 Underwriting Guidelines and Development Standards, and its 2026 Program Bulletin found no mention of the 50% test, the 25% OBBBA alternative, "One Big Beautiful Bill," OBBBA, or Pub. L. 119-21 anywhere. Unlike some other states, this research found no evidence that RIHousing has layered its own, tighter administrative percentage on top of the federal test. That means a Rhode Island 4%/bond deal is left to apply whichever version of the federal test governs its own bond issuance dates on its own terms — confirm current applicability directly with RIHousing and bond counsel rather than assuming either the old 50% or the new 25% number is what RIHousing expects to see in an application.

Governance is mid-transition: the Executive Office of Housing now leads QAP development, and a 2027 QAP is already circulating in draft form

Rhode Island created a new Executive Office of Housing (EOH) by P.L. 2025, ch. 278, art. 9, § 11, effective June 29, 2025 (codified at R.I. Gen. Laws Chapter 42-167). EOH's statutory powers include administering "programs pertaining to housing resources that may be assigned by state law," explicitly including "[t]ax credits that assist in the provision of housing" (§ 42-167-3(3)(vii)). RIHousing's own 2026 QAP — the document that governed the round that already completed, with awards decided at the April 2026 Board of Commissioners meeting — describes itself alone in its Introduction as the agency that "has been designated the responsibility for administering the federal Low-Income Housing Tax Credit ... Program ... for the State of Rhode Island." But a 2027 Qualified Allocation Plan, released in draft form dated "DRAFT 7.31.26 for public comment," changes that framing directly in its own Introduction: "as of January 1, 2026 state law makes the development of this plan the responsibility of the RI Executive Office of Housing ('EOH')" and "[t]he EOH in coordination with RIHousing has developed this Allocation Plan." That confirms the governance shift as real, not speculative — it simply happened mid-2026, after the 2026 QAP's own text had already been finalized, and the 2026 QAP was never revised to reflect it.

That same 2027 draft also revises one of the 2026 QAP's own numbers after the fact: where the 2026 QAP prospectively estimated Rhode Island would receive "the small state minimum or approximately $3,600,000 for 2026," the 2027 draft states retrospectively that Rhode Island "received the small state minimum of approximately $4,000,000 in 2026" and expects "the 2027 allocation will be a similar amount." This research could not reconcile the two figures from any single document — treat $3,600,000 as the 2026 QAP's own forward-looking estimate at the time it was finalized, and $4,000,000 as RIHousing/EOH's later, presumably more accurate, retrospective figure for the same 2026 allocation year. The 2027 draft also adds a clarifying sentence not present in the 2026 QAP: the 4% acquisition credit (drawn from the same per-capita pool as the 9% credit) is described as "typically applying to the acquisition portion of a project that is receiving 9% credits on the remainder of the project" — i.e., a common real-world pairing distinct from the bond-financed "Hybrid Development" described above.

As of this research (September 2026), this draft had not been confirmed as finally board-approved and Governor-approved — its own cover page still reads as a public-comment draft, and its funding-round schedule (RFP issuance "October/November, 2026"; proposals due "December 2026/January 2027"; awards "At the April or May 2027 Board" meeting) describes a round that had not yet opened at the time of this research. Confirm directly with RIHousing/EOH whether the 2027 QAP has since been finalized before citing any 2026-QAP-specific figure to a developer preparing a Fall 2026 or later application — the 2026 QAP's own competitive round is already closed, so a new applicant is very likely working under whichever version of the 2027 plan RIHousing has since adopted, not the 2026 QAP this content otherwise cites throughout.