Title
An Ordinance Approving the Transfer and Reallocation of Volume Cap in Connection with Private Activity Bond Issues, and Related Matters
History
Section 146 of the Internal Revenue Code of 1986 provides that a municipality has a volume cap allocation per year, which volume cap may be allocated to certain tax-exempt private activity bonds.
The Village of Orland Park’s 2026 Volume Cap allocation is $135.00 per capita. “Volume Cap” is defined as a limit on the aggregate amount of tax-exempt private activity bonds that can be issued by the State.
The Volume Cap is allocated annually. To date, the Village’s 2026 Volume Cap has not been granted or transferred to another party. According to State Statute, the Village Board must pass an ordinance on an annual basis either reserving its volume cap or transferring the volume cap to another party and must notify the State in writing of any Volume Cap granted, transferred, or reserved by official action of the Board no later than April 30th of each calendar year.
As has occurred in prior years, a request has been made to transfer the Village’s volume cap to the Town of Normal, McLean County, Illinois, one of the lead issuers of the debt utilized to fund the Assist Homeownership Program (“Assist”). Assist is a program that utilizes municipal volume cap allocations to provide funds to cover all or most of the closing costs and down payments required of homebuyers. Assist also provides Mortgage Credit Certificates to help reduce the homebuyer’s ongoing cost of borrowing.
The Assist Homebuyer Down Payment Program offers homebuyers a 30-year, fixed-rate mortgage and a 3% to 7% cash grant, forgivable monthly over three years, to qualifying homebuyers to fund closing costs and down payment assistance.
Mortgage Credit Certificates allow the homebuyer (for first-time homebuyers who have not taken a mortgage tax deduction over the past 36 months) to qualify for a federal income tax credit equal to 35% of the interest paid ...
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