Organizational Requirements for Low-Income Housing Properties

Organizational Requirements (Board Determination)

Consistent with the Board's role under the new administration in determining whether an organization is eligible for the welfare or veterans' organization exemption, Board staff will determine whether the managing general partner is a qualifying nonprofit organization or eligible limited liability company. Additionally, Board staff will determine if the organizational structure for a property is such that the property is eligible for the welfare exemption. That is, Board staff will also determine if the managing general partner has sufficient management authority and duties to qualify the property for exemption.

A limited partnership in which the managing general partner is an eligible nonprofit organization or eligible limited liability company, meeting the requirements of Rule 140.1, that owns low-income housing property for which it will claim the welfare exemption must file a claim for Supplemental Clearance Certificate for Limited Partnership, Low-Income Housing Property - Welfare Exemption for the low-income housing property.

Supplemental Clearance Certificate Claim Forms (Claim Forms Filed with Board)

The limited partnership is required to file with the Board a claim for a supplemental clearance certificate on form BOE-277-L1, Claim for Supplemental Clearance Certificate for Limited Partnership, Low-Income Housing Property - Welfare Exemption. The initial claim must be accompanied by the following documents:

  • a copy of a recorded deed restriction or a copy of a regulatory agreement with a public agency that verifies that the property receives either government financing or low-income housing tax credits, as required by section 214, subd. (g)(1)(A);(g)(1)(B),
  • a copy of the grant deed, or if the land is not owned by the limited partnership, documents evidencing the limited partnership's ownership of the improvements, and
  • a copy of Secretary of State form LP-1, Certificate of Limited Partnership, and if applicable, Secretary of State form LP-2, Amendment to Certificate of Limited Partnership.

The Board will issue Supplemental Clearance Certificates to Limited Partnerships with a managing general partner that is a nonprofit organization, or eligible limited liability company that holds a valid Organizational Clearance Certificate, upon a further determination that the property meets all the organizational requirements for exemption under section 214, subdivision (g). Board staff will issue a finding, on form BOE-277-SF, Supplemental Clearance Certificate Finding Sheet for Limited Partnership, Low-Income Housing Property Welfare Exemption, to notify the claimant of the property's eligibility for exemption. Once granted, a Supplemental Clearance Certificate shall remain valid until the Board staff determines that the property no longer meets the organizational requirements of section 214, subdivision (g) and Property Tax Rules 140.1 and 140.2. A sample Supplemental Clearance Certificate may be accessed below:

The claim form for Supplemental Clearance Certificate is supplied by the State Board of Equalization. If you wish to obtain claims for a Supplemental Clearance Certificate for Limited Partnership, Low-Income Housing Property - Welfare Exemption, contact the Assessment Policy and Standards Division's Exemption Section at 916-445-3524. Sample claim form is listed below: