Site control and due diligence — West Virginia

Site control is a one-way door, not a checkpoint

At Reservation Request, the Applicant must submit "one of the following to evidence site control of the property: a recorded deed, an option, a purchase contract, an option to enter into a Long-Term Lease, or a Long-Term Lease in the name of the Ownership Entity for the subject property." A Long-Term Lease is itself a defined term: "a land lease of no less than 30 years, in which (1) the lessor agrees to be a party to the Regulatory and Restrictive Covenants for Land Use Agreement, (2) the lease terms provide that the Restrictive Covenants survive termination of the lease, and (3) the lease terms contain any other provisions required by the Fund."

The Manual's "Maintenance of Continuous Site Control" subsection then states the operative rule directly: once the Reservation Request is submitted, the Ownership Entity "must have and continuously maintain control of the site and existing buildings, if any," and "in the event the Ownership Entity loses site control of all or part of the site after the Reservation Request has been submitted to the Fund, the application for the property, regardless of stage of processing, will be automatically rejected and any documents entered into for such property or for the buildings in any such property will be automatically canceled." This applies even to wait-listed properties -- site control must be maintained until the property is removed from the waiting list, not just until it is initially ranked.

The Manual then goes further than a simple continuity requirement: "The Fund believes that the location of the site is so integral to the acceptance and scoring of a property that the Fund will not consider a site change once a property's Reservation Request has been submitted, unless it is directly responsive to provide replacement housing only in the event of a federally declared disaster." In limited circumstances the Fund may allow additional parcels to be added to an existing site (with prior written notice and Fund approval), but that is materially different from swapping to a different site. Due diligence that would ordinarily justify walking away from a site elsewhere -- a bad Phase I finding, a failed geotechnical test, a zoning denial -- functionally cannot be acted on the same way in West Virginia once the Reservation Request is in, because there is no site-substitution path built into the process short of a federal disaster exception.

Site control has to mature -- deed or Long-Term Lease, on two different clocks

An option or purchase contract is acceptable to get in the door at Reservation Request, but it is not the end state the Fund requires. No later than one year from the date of the Carryover Allocation Certificate (for non-bond properties), or no later than 90 calendar days after bond closing (for Tax-Exempt Bond Financed Properties), the Applicant must submit "documentation evidencing that the Owner has maintained continuous site control (from the date of the initial site control submitted with the property's Reservation Request) in the name of the Ownership Entity and has established site control in the name of the Ownership Entity in the form of a recorded deed or Long-Term Lease." An option or purchase contract, in other words, is only a placeholder -- by this later deadline it must have converted into an actual recorded deed or a fully executed Long-Term Lease.

Title diligence is required earlier and separately: at the Reservation Request itself, the Applicant must submit a "Chain of Title Summary, in the form prescribed by the Fund, covering at least ten years from the date the site control was executed." This is a 10-year lookback tied to the site control document's execution date, not to the Reservation Request date -- worth calculating carefully if site control was put in place well before the application was filed.

A separate title search (showing all outstanding liens and encumbrances) appears elsewhere in the Manual, but only in the Qualified Contract process used during the post-Compliance-Period exit window -- a different stage of a property's life entirely, not part of initial site due diligence, and this research did not find that a full title search or title insurance commitment is itself an enumerated Reservation Request requirement (title insurance appears only as a line item in the Fund's illustrative development-cost fee schedule, not as a described procedural requirement).

Environmental review: two different reviews, on two different timelines

For any property involving substantial rehabilitation (including gut rehabilitation or adaptive reuse), a Capital Needs Assessment is required with the Reservation Request itself, and it must include "an evaluation of the presence of environmental hazards, such as asbestos, lead paint, and mold, on the site" as one component of a broader physical-condition review (structural systems, mechanical systems, site topography and drainage, accessibility). This is a lighter, earlier environmental screen specific to rehabilitation deals -- not a substitute for the full Phase I.

The full Phase I Environmental Site Assessment is a separate, later requirement that applies once a property is selected, not at Reservation Request. It must be "professionally prepared and independent," addressed to and prepared for the Fund, and "prepared in accordance with the American Society for Testing and Materials (ASTM) E1527-13 Standard Practice for Environmental Site Assessments: Phase I Environmental Site Assessment Process, or its successor standard." The Manual lists specific additional items the Phase I must address beyond the ASTM baseline: asbestos-containing building materials, radon, lead-based paint, regulatory health and safety compliance, continuing or ongoing toxic/hazardous-substance obligations, indoor air quality, lead in drinking water, mold, and "potential for residual contamination from agricultural activities, such as the use of arsenical pesticides, even where such substances were used in accordance with the label."

Notably, this enumerated list does not separately name former coal-mining land, mine subsidence, or acid mine drainage -- terrain and land-use issues that are common in parts of West Virginia -- and this research did not find any WVHDF-published document that addresses mining-related contamination or subsidence specifically. A standard ASTM E1527-13 Phase I's historical-records review would still be expected to surface a documented former-mining use on a specific parcel as part of its ordinary scope, but that is a general feature of the ASTM standard itself, not a West Virginia-specific instruction from the Fund. A developer evaluating a site on former mining land should not assume WVHDF's own materials provide any additional, mining-specific guidance beyond the standard Phase I process -- this should be treated as an open item to raise directly with the Fund and with the environmental consultant, not resolved by assumption.

Geotechnical, utility, and flood diligence -- what's due early versus what's due at equity closing

A full third-party Geotechnical Report is required for any property involving new construction, but not until "Prior to Equity Closing" -- well after Reservation Request, Threshold Review, and the Carryover Allocation Request have all been completed. By that stage, the Manual requires that "the above-referenced construction plans must incorporate the recommendations from the property's Geotechnical Report" and that the construction cost estimate include the cost of implementing those recommendations. In the meantime, the earlier Property Architect Site Suitability Rating (due with the Reservation Request) functions as the practical early terrain screen: it requires the Property Architect to assess cuts and/or fills, rock formations, extensive grade, subsurface rock, drainage, and high water table well before a full geotechnical study is commissioned.

Utility capacity diligence, by contrast, is due unusually early: for New Supply properties, "the site must currently have water and sewer capacity for the proposed property," evidenced by will-serve letters or other Fund-acceptable documentation attached to the Reservation Request's Site Suitability Rating -- not deferred to a later stage the way the full environmental and geotechnical work is.

Flood diligence is also front-loaded: a color, dynamic FIRMette flood map pulled directly from FEMA's Flood Map Service Center (msc.fema.gov/portal) is required with the Reservation Request. If a site sits in the 100-year floodplain, the Manual states that "only in limited circumstances, will flood mitigation be permitted for new construction properties," that any new construction within the 100-year floodplain must have all new improvements built at least two feet above the floodplain elevation, and that "neither Fund resources nor equity generated from Credits may be utilized for site flood mitigation." That last restriction is a real, quantifiable underwriting constraint: a floodplain site needing significant mitigation work cannot fund that work out of the deal's own Credit-generated equity or Fund financing.

State-level environmental triggers and local jurisdiction notice, independent of the Fund's own checklist

Separate from anything WVHDF itself administers, West Virginia's Minimum Housing Standards explicitly require compliance with "EPA NPDES Permit and State DEP Water Quality Requirements" as a baseline eligibility condition. In practice, this is the West Virginia Department of Environmental Protection's Construction Stormwater General Permit (currently WV/NPDES General Water Pollution Permit No. WV0115924, effective April 6, 2024 through April 5, 2029), which requires permit coverage for any site disturbing one acre or more -- including a smaller phase that is part of a larger common plan of development. Most new-construction LIHTCP sites of any real size will cross this one-acre threshold and need to budget for WV DEP's Electronic Submittal System application process as a distinct, state-level (not Fund-administered) approval running in parallel with the Fund's own checklist.

Separately, the Applicant must notify the Chief Executive Officer of the Local Jurisdiction in which the property sits, using one of two specific permissible methods: certified mail or a verifiable commercial delivery service (with a copy of the delivery receipt), or email (with a return acknowledgment email from an authorized representative -- "an email read receipt is not acceptable proof of acknowledgement of delivery"). The Fund separately performs its own notification under Subsection 42(m)(1)(A)(ii) of the Internal Revenue Code, giving the local Chief Executive Officer 60 calendar days to comment; the Fund states plainly that it "will not consider any comments that object to the property development in violation of the Fair Housing Act or any other applicable federal or state law." This is a notice-and-comment process, not a local veto or approval requirement -- it runs independently of whatever actual zoning or permitting process the local jurisdiction may or may not have (see Phase 3).

State Historic Preservation Office (SHPO) review under Section 106 of the National Historic Preservation Act is also required at Reservation Request, and since September 16, 2024, SHPO accepts these requests only through its online GOapply portal. The Manual recommends submitting to SHPO at least 45 calendar days before the Reservation Request due date; if SHPO has not responded by the deadline, the Applicant must at least show evidence that a complete request was received by SHPO no later than 30 calendar days before the deadline. If neither condition is met, the Manual states this deficiency "is not correctable and will result in the rejection of the property" -- one of the few Reservation Request items explicitly carved out of the general Correction Period safety net.

The cost of incomplete diligence at submission: negative points, not just rejection

West Virginia does not treat a late or incomplete due-diligence document purely as a threshold pass/fail item. Any Reservation Request Acceptance Checklist item -- which includes site control evidence, the Chain of Title Summary, the Site Suitability Rating Form, the FEMA flood map, the SHPO response, the site plan, and the market study, among others -- that is missing at the Reservation Request due date but is fixed during the Threshold Review and Correction Period still costs the property points, on an escalating scale: two points each for the first and second such item, three points each for the third and fourth, four points each for the fifth and sixth, and five points each for the seventh item and beyond. Given the Plan's 500-point minimum threshold out of 993 available, a handful of avoidable diligence gaps at submission can be the difference between clearing that threshold and not, even when every gap is eventually cured.