2.8 “” PolicyUnder LIHTC guidelines:

If AMI decreases, rent limits are not required to decrease.

This policy allows properties to:

Maintain previously established higher rent limits Effect ScenarioRent Impact AMI increases Rent can increase AMI decreases

Rent does not have to decrease OutcomeRent structures:

Move upward over time but are not required to adjust downward

Section 2 — Key FindingsFrom official methodology and real-world application:

AMI is based on household income, not individuals

A 4-person baseline is used to derive all limits Rent is based on area averages, not tenant income

Unit pricing uses a 1.5-person assumption (non-real household)

Income is projected, not actual

Gross income is used instead of net Variable income can be treated as recurring Rent limits are not required to decrease

The governing mechanics of the LIHTC program rely on standardized assumptions, projected income calculations, and area-based income metrics that are not directly tied to an individual tenant’s actual financial condition. These mechanisms form the foundation upon which rent levels are determined.