The LIHTC and HOME Programs both monitor projects annually for compliance with rent and occupancy requirements. Monitoring may consist of reviews of submitted documents or may involve on-site examinations of tenant files and other documentation.
Projects receiving both HOME and LIHTC funding are monitored over the course of each program's affordability period. Monitoring agencies may set affordability periods to be equal in length, or the project may be subject to one set of requirements for a shorter period of time than the other.
- For LIHTC projects, designated state agencies monitor for compliance with Internal Revenue Code section 42 for a period of 30 years, unless the agency establishes a longer affordability period.
- For HOME projects, PJs monitor for compliance throughout the affordability period, which is determined based on the amount of HOME funding and the type of activity funded:
- New construction projects must comply with HOME requirements for an affordability period of at least 20 years.
- For other activities receiving less than $15,000 HOME funds per unit, the affordabilty period is 5 years.
- For other activities receiving $15,000 to $40,000 HOME funds per unit, the affordability period is 10 years.
- For other activities receiving more than $40,000 HOME funds per unit, the affordability period is 15 years.
Additionally, the HOME Program requires regular on-site inspections to ensure compliance with applicable property standards and income requirements. The timing of the inspections depends on the total number of units in the project. Projects of 1 to 4 units are inspected every 3 years, projects with 5 to 25 units are inspected every 2 years, and projects with more than 25 units are inspected annually (using a sampling technique).