RHLS Submits Recommendations on Pennsylvania’s Draft Qualified Allocation Plan.

PHFA’s Qualified Allocation Plan may not be a household term, but it is one of the most important policy documents shaping the future of affordable housing in Pennsylvania. RHLS recently submitted comments to the Pennsylvania Housing Finance Agency (PHFA) on its proposed 2027-2028 Qualified Allocation Plan (QAP), urging the agency to build on several positive changes while reconsidering proposed policies that could create new barriers to affordable housing development and preservation across the Commonwealth.

Through the representation of over 100 nonprofit clients across the Commonwealth, RHLS has a unique perspective on the impacts that the QAP can have on development. Our QAP comments reflect lessons learned from the experiences of our development clients who work to house those with low incomes, disabilities, and other challenges that are barriers to housing stability.

The QAP governs how PHFA allocates Low-Income Housing Tax Credits (LIHTC), the primary federal tool used to finance affordable rental housing. Decisions made through the QAP influence where affordable housing is built, which communities receive investment, and how effectively Pennsylvania can respond to growing housing needs. The QAP is more than an allocation document. It is a statement of the Commonwealth’s housing priorities and will help determine whether scarce housing resources are used to expand opportunity, preserve existing affordable homes, and serve Pennsylvanians with the greatest housing needs.

The following includes a summary of our comments. You can read the full text here. 

RHLS applauds PHFA for several positive changes included in the draft QAP. Among them are increased maximum 9% LIHTC award amounts, elimination of certain basis limitations that add complexity to development financing, greater flexibility for supportive housing developments, and stronger enforcement tools to preserve long-term affordability. We also strongly support proposed improvements to restrictive covenant agreements, including enhanced tenant protections, stronger compliance mechanisms, and expanded rights designed to help tenants receive the full benefits of LIHTC-financed housing.

At the same time, several proposed policy changes could unintentionally limit affordable housing production:

One significant concern involves a proposal that would make local zoning approval a threshold requirement for LIHTC applications. Making municipal approval a prerequisite for participation in the application process could reinforce local barriers to development and create an unnecessary financial burden on emerging developers before securing financing. Obtaining zoning approvals can be costly, time-consuming, and highly dependent on local processes, creating challenges for nonprofit and community-based developers. Our recommendation includes retaining zoning as a scoring factor rather than elevating it to a mandatory eligibility requirement.

RHLS also opposes a sponsor liquidity requirement that would require developers to demonstrate significant financial reserves before applying. While PHFA’s goal of ensuring successful project completion is understandable, the proposal could disproportionately disadvantage emerging developers, nonprofit organizations, and community-based sponsors that often deliver high-impact affordable housing despite not maintaining large unrestricted reserves. Existing lender and investor underwriting standards already provide extensive financial review, making the proposed requirement unnecessary and potentially harmful to efforts to diversify Pennsylvania’s affordable housing development pipeline.

The comments further emphasize the need for stronger support for supportive housing. Pennsylvania faces a substantial shortage of supportive housing for individuals and families with disabilities and others requiring both affordable housing and supportive services (link to Pathways to 38 report). RHLS joined the Pennsylvania Supportive Housing Coalition in recommending deeper affordability targets, increased funding flexibility, and a dedicated preservation strategy to ensure existing supportive housing developments are not lost.

The preservation of existing affordable housing is another major focus of our recommendations. By 2029, nearly 12,000 publicly supported affordable housing units across Pennsylvania will be approaching the expiration of their affordability restrictions. Proposed changes could reduce preservation priorities within the QAP and create additional hurdles for preservation projects seeking tax credits. We urge PHFA to strengthen preservation efforts to protect existing affordable homes, the residents who depend on them, and the public investment that has already created a critically needed resource.

Ultimately, affordable housing policies should expand opportunities for nonprofit developers, preserve existing affordable homes, support vulnerable populations, and remove barriers to housing production rather than create new ones. As Pennsylvania continues to face significant housing challenges in urban, suburban, and rural communities alike, the final QAP will play a critical role in shaping the Commonwealth’s affordable housing landscape for years to come.

RHLS appreciates PHFA’s willingness to engage with stakeholders and welcomes continued dialogue as the agency finalizes the 2027-2028 QAP. We remain committed to advancing policies that expand, preserve, and protect affordable housing opportunities throughout Pennsylvania.

If you would like to join RHLS in future advocacy efforts to strengthen affordable housing policy in Pennsylvania, please contact Deanna Dyer, Director of Policy, at deanna.dyer@rhls.org.

• Remove unnecessary barriers to participation in the application and development process for nonprofit, community-based, and emerging housing developers such as requiring zoning permitting as a threshold and holding significant financial reserves in liquidity.
• Prioritize supportive housing to address the significant shortage of housing for Pennsylvania’s lowest income and most vulnerable households.
• Strengthen efforts to use LIHTC as a mechanism to preserve existing affordable housing to sustain existing public investments and avoid the displacement of stable households.