Rhode Island Tax and Loan Incentives
Has anyone used or know of any local projects taking advantage of tax credits or low-interest loans?
I have not.
the strings are usually attached to Low Income housing.
@Fan Bi I haven’t used them. My advice is, read the fine print and understand the economic trade-offs you’d be making.
You can come out ahead, but usually not as far ahead as appears on first glance, so make sure you understand the full deal that you’d be striking.
The few that I investigated, I decided limited my future options too much so I chose to pay market interest rates to retain my flexibility with the property/project, or in other cases decided not to pursue the project at all regardless of financing terms.
One important thing to look for is whether the financing (and obligations) transfer to any future owner and if so, under what terms, or if they do not, and instead trigger some kind of backout/payout clause on you.
Many of those tax/loan programs stretch out over years, and since it’s hard to predict the future, it’s also hard to understate how they can limit your future options with the property.
For example, many times we’ll do a 10-year holding projection initially but market conditions after only 4 or 5 years might warrant considering an earlier exit. However, the type of program you’re talking about can limit the ability to do an early exit profitably.
Like I said, just try to think through all the implications of the terms of such programs.
@Fan Bi
There are a few right now that are active. I’ll send you some of the info.
@Fan Bi
The city of Providence has RFPs for affordable housing initiatives, which includes tax credits.
I just had a zoom conference with one of the lead developers for one of the non-profit housing companies. The chances of individuals/sole proprietors getting these RFP’s and tax credits are slim, as they save them for the non-profits and bigger players..but there are some loopholes.
Check the city of Providence’s website for RFPs
Related, has anyone used RISE engineering/ National Grid or RI LeadSafe subsidies/ rebates? Are there other rehab/ improvement incentives locally?
@Fan Bi I've used National Grid rebates a couple of times. They're very seasonal but they can be real money if you happen to catch one at the time you need it. Kinda like coupons in that way.
RISE Engineering is a great service, I recommend everyone - home owners and rental property owners alike - take advantage of them. After all, we're paying for them anyway (it comes out of one of the line items on our National Grid bills, I forget which one, it's something generic sounding like "RI energy programs").
They do decent work at a great price and it will save you energy/money over the long run too. The only challenge is that they are usually very backed up, so if you make an appointment now it could be 3-9 months before they actually can come out and do the energy assessment.
I haven't used any of the interest free or low interest loan programs for doing lead safe/remediation work, that I think you're asking about, but I am loosely familiar with them.
Basically while I appreciated knowing about those programs, I'd already budgeted for that work in my rehabs and didn't feel like being slowed down to apply for and arrange for the loan when I didn't need a loan in the first place. But I can see the appeal it could have especially if you're already stretched thin on your rehab budget.
If you're really interested in that I can hook you up with someone who knows those programs inside and out.