HUD Publishes 2014 DDAs

On Nov. 15, HUD published the Difficult to Develop Areas (DDAs) for 2014 and indicated that the Qualified Census Tracts (QCTs) that were published April 20, 2012, will remain in effect. HUD also announced that in 2016 it will begin to use small-area fair market rents instead of metropolitan-area fair market rents to designate metropolitan DDAs.

The 2014 DDAs are based on final fiscal year 2013 fair market rents, fiscal year 2013 income limits, and 2010 census population counts. Low-income housing tax credit properties in DDAs are eligible for as much as a 30 percent increase in eligible basis compared to those not in DDAs.

Compared to the 2013 list, HUD added 92 non-metro counties to the DDA list and dropped 108. HUD also added 11 metro areas and dropped three, leading to a net increase of eight metro areas. Florida lost the most metro areas, with four lost and one gained. And Texas lost 30 non-metro areas. Meanwhile, its neighbor to west, New Mexico, saw the biggest gain, with 16 non-metro areas added.

California dropped six non-metro counties but didn’t add any new ones. Arizona, Florida, Illinois, Indiana, Nebraska, Nevada, New York, and Puerto Rico all dropped non-metro counties without gaining any new ones. Georgia, North Carolina, South Carolina, Texas, and Vermont all added metro areas after not having any last year.

Meanwhile, the 2014 QCTs will remain the same as 2013. QCTs, which also qualify for a 30 percent basis increase, are designated based on data from the American Community Survey, which is collected every five years. HUD plans to release new QCTs only when all the data is new, so every five years. This means that HUD won’t re-designate QCTs until 2018.