Rep. Hultgren Circulates Letter in Support of Private Activity Bonds, Outreach Needed

Rep. Randy Hultgren (R-IL-14) is circulating a letter to House and Senate leadership opposing the proposed elimination of tax exempt private activity bonds in the House’s version of the Tax Cuts and Jobs Act (H.R. 1), focusing on the need for private activity bonds to support investments in our nation’s infrastructure. The letter also objects to the elimination of advanced refunding bonds in the House bill. “Private activity bonds finance exactly the sorts of public private partnerships of which we need more of, not less,” the letter states. “These bonds help finance housing for low- to moderate-income families that otherwise would not get built; toll roads and expressways, airports and seaports; hospitals and universities.”

Rep. Hultgren will be adding Republican signatories from both the House and the Senate until noon on Monday, Nov. 27. Please urge your Republican Senators and Representatives to sign on by contacting Bill Hulse at bill.hulse@mail.house.gov in Rep. Hultgren’s office.

Eliminating private activity bonds would have a devastating effect on affordable housing. Multifamily Housing Bonds, which are a type of private activity bond, provide critical financing to more than half of all Housing Credit developments annually by triggering the “4 percent” Housing Credit. Without multifamily Housing Bonds, this housing simply would not be built. See our talking points on Housing Bonds.

According to Novogradac & Co., the proposed elimination of private activity bonds would result in a loss of roughly 788,000 to 881,000 affordable rental homes over the next decade. See how many affordable homes would be lost in your state. While the Senate version of the tax reform bill would retain private activity bonds, their inclusion in any final tax bill is incumbent on continued advocacy.

In addition to advocating for the preservation of Housing Bonds, we also continue to urge Senators to adopt a proposal that would sustain Housing Credit investment in light of the lower corporate rate. See our recent blog post on the latest developments in tax reform and advocacy needed, and visit our Advocacy Toolkit for more materials to assist in your outreach.

If you have any questions, please contact Emily Cadik, Director, Public Policy, Enterprise Community Partners, at ecadik@enterprisecommunity.org or 202-403-8015, or Jennifer Schwartz, Assistant Director for Tax Policy and Advocacy, National Council of State Housing Agencies, at jschwartz@ncsha.org or 202-624-7758.

House Passes Tax Reform Bill, Senate Finance Committee Sends Tax Reform Bill to Floor

Yesterday the House approved its version of the “Tax Cuts and Jobs Act” by a vote of 227 - 205, with all Democrats and 13 Republicans voting against it. While the bill retains the Low-Income Housing Tax Credit (Housing Credit), the House did not include any changes during the mark-up that would restore private activity bonds, including Housing Bonds, nor were there changes to sustain Housing Credit production in a lower corporate tax rate environment. As written, this bill would reduce our future supply of affordable rental housing by nearly one million homes.

Yesterday the Senate Finance Committee also advanced its version of the “Tax Cuts and Jobs Act” out of committee on a party-line vote of 14 - 12. The Senate bill retains both the Housing Credit and private activity bonds and includes several no-cost provisions to strengthen the Housing Credit, taken from the Cantwell-Hatch Affordable Housing Credit Improvement Act (S. 548). While the Finance Committee did not make further modifications to the bill to address the impact of the lower corporate rate on the Housing Credit, bipartisan discussion around this issue suggests there is genuine interest in addressing the concern as the bill moves forward. However, without this change, the Senate bill would reduce the future supply of affordable rental housing by over 200,000 homes.

The House and Senate are now in recess until after Thanksgiving. We expect the Senate to consider its bill on the floor when they return to Congree the week of November 27. At this point, it is not clear whether the House and Senate will have a formal conference to resolve differences between their bills or if there will be more informal negotiations either in advance of or following Senate passage of the bill on the floor. 

If House and Senate leaders decide to undertake informal negotiations over the Thanksgiving recess in advance of Senate passage, it is likely that a new version of the bill reflecting those negotiations will be considered on the Senate floor, rather than the version of the bill that cleared the Committee yesterday. The House would then be expected to take up the negotiated version of the Senate bill once it clears the Senate and pass it without further modifications. 

This may be our last opportunity to influence the process before House and Senate leaders negotiate a final bill, and while the Senate bill is far better for affordable housing, congressional leaders will be under significant pressure from many different interest parties to retain various tax breaks while staying within the $1.5 trillion cost allowed by the Budget Resolution for a reconciliation bill. It is incumbent on us that we further step up our advocacy to make sure that the final bill retains both the Housing Credit and Housing Bonds, and leaves our affordable housing delivery system at least as strong as it is today.

Outreach to the Senate:

  • If you have Republican Senate Finance Committee members, thank them for retaining both the Housing Credit and Housing Bonds in the legislation and for including in the bill additional provisions to strengthen the Housing Credit
  • We urge everyone to also reach out to your senators, both on and off the Finance Committee and especially Republicans, and urge them to communicate to Chairman Orrin Hatch (R-UT) and Majority Leader Mitch McConnell (R-KY) their support for the Housing Credit and Bonds, and tell them to make sure they retain these programs in the final legislation as negotiated with the House. 
  • Also, urge your Senators to tell Chairman Hatch and Leader McConnell to make further changes to the legislation to sustain affordable housing production in light of the lower corporate rate.

Outreach to the House:

  • Thank your Republican House members for retaining the Housing Credit, but tell them that the bill as written would have a devastating impact on affordable housing by virtue of eliminating Housing Bonds. If possible give them examples of properties in their districts that would not have been built without Housing Bonds, and explain the overall impact on your state (state by state impact numbers are provided in the Novogradac links below). 
  • Urge your Republican House members to communicate to Ways and Means Committee Chairman Kevin Brady (R-TX) and House Speaker Paul Ryan (R-WI) their support for retaining the Housing Credit and restoring Housing Bonds in any final legislation as negotiated with the Senate.
  • Urge your Republican House members to tell Chairman Brady and Speaker Ryan that Congress must sustain affordable housing production in light of the lower corporate rate.

See our Advocacy Toolkit for:

We will not be holding the monthly ACTION Campaign call that would have fallen on Friday, November 24, but if you have any questions please contact Emily Cadik, Director, Public Policy, Enterprise Community Partners, at ecadik@enterprisecommunity.org or 202-403-8015, or Jennifer Schwartz, Assistant Director for Tax Policy and Advocacy, National Council of State Housing Agencies, at jschwartz@ncsha.org or 202-624-7758.

New Senate Tax Reform Bill Adds Provisions to Strengthen Housing Credit, but Additional Changes Needed

Last night Senate Finance Committee Chairman Orrin Hatch (R-UT) released a “modified chairman’s mark” — an updated version of the Senate’s tax reform legislation from which the Committee will now work — that includes several changes relevant to the Housing Credit.

The new version of the bill still retains the Low-Income Housing Tax Credit (Housing Credit) and private activity bonds, including multifamily Housing Bonds. It also adds several no-cost proposals to strengthen the Housing Credit, taken from the Cantwell-Hatch Affordable Housing Credit Improvement Act (S. 548), which would: 

  • Allow for a reasonable restoration period after a casualty loss (Sec. 302)
  • Replace the existing nonprofit right of first refusal with a purchase option to help nonprofit sponsors keep properties affordable for the long term (Sec. 303)
  • Clarify that state Housing Credit agencies have the authority to determine what constitutes community revitalization, with broad parameters, for purposes of determining whether properties are eligible for a basis boost by virtue of being located in a Qualified Census Tract and contributing to a “concerted community revitalization plan” (Sec. 307)
  • Prohibit local approval and contribution requirements in order to prevent NIMBY opposition from interfering with Housing Credit development (Sec. 308)
  • Require that states add a selection criteria to their Qualified Allocation Plans for housing that serves the needs of Native Americans (Sec. 401)
  • Rename the Low-Income Housing Tax Credit to the "Affordable Housing Tax Credit" (Sec. 501)

See our bill summary for more information about these provisions. Because many of the other broadly-supported provisions in the Affordable Housing Credit Improvement Act would cost money (though in many cases minimally), they were not included in the modified mark due to budgetary pressures. 

The bill does not, however, provide any changes to the Housing Credit to preserve its production potential in a 20 percent corporate tax rate environment. According to Novogradac & Co., absent any change to the Housing Credit, the lower corporate rate would translate into a loss of roughly 200,000 affordable rental homes over the next ten years. ACTION is strongly advocating for a modification that would preserve production levels so that the Housing Credit remains at least as robust a tool as it is today. 

ACTION needed:

  • Thank Chairman Hatch and other Republican members of the Senate Finance Committee for retaining the Housing Credit and Housing Bonds and for adding provisions to strengthen the Housing Credit. 
  • Urge your senators to communicate to Chairman Hatch and Majority Leader Mitch McConnell (R-KY) their support for the Housing Credit and Bonds, and tell them to make sure they retain these programs in the final legislation as negotiated with the House.
  • Urge Republican Senators to tell Chairman Hatch he must make further changes to the legislation to sustain affordable housing production in light of the lower corporate rate.

See our Advocacy Toolkit for an updated sample letter to Senators and other resources.

If you have any questions, please contact Emily Cadik, Director, Public Policy, Enterprise Community Partners, at ecadik@enterprisecommunity.org or 202-403-8015, or Jennifer Schwartz, Assistant Director for Tax Policy and Advocacy, National Council of State Housing Agencies, at jschwartz@ncsha.org or 202-624-7758.

Senate GOP Tax Reform Bill Retains Housing Credit and Housing Bonds

Senate Tax Reform Bill Retains Housing Credit and Housing Bonds

Yesterday Senate Finance Committee Chairman Orrin Hatch (R-UT) introduced the Senate’s version of the “Tax Cuts and Jobs Act,” with significant differences from the House’s version released last week. The Senate bill would:

  • Retain the Low-Income Housing Tax Credit (Housing Credit), with no changes.
  • Retain private activity bonds, including multifamily Housing Bonds, which provide critical financing to more than half of all Housing Credit developments.
  • Lower the corporate tax rate from 35 to 20 percent, effective in 2019.  Neither the House nor the Senate bill makes any adjustments to sustain Housing Credit investment in light of the lower corporate rate.

We thank Senate Finance Committee Chairman Orrin Hatch (R-UT) for rejecting the House tax reform bill’s elimination of private activity bonds – a proposal that would devastate affordable housing – and urge him to hold firm on this issue as this process progresses. We also call on Senator Hatch to make adjustments to the Housing Credit to offset the impact of the lower corporate tax rate on Housing Credit investment when he releases his modified “chairman’s mark,” prior to the Committee’s mark-up.

The Senate is expected to begin marking up its legislation Monday afternoon, and we are encouraging Republican Senators to weigh in with Chairman Hatch to express their support for the retention of both the Housing Credit and private activity bonds, and to support maintaining the productivity of the Credit in a lower corporate tax rate environment.

House Advances Tax Reform Bill Without Needed Improvements

Yesterday the House Ways and Means Committee also advanced its version of the Tax Cuts and Jobs Act on a party-line vote. The House version of the bill would retain the Housing Credit with no adjustments, but would devastate affordable housing production by eliminating the tax exemption on private activity bonds, including multifamily Housing Bonds.

While some changes to the bill were made during mark-up, none would reverse the bill’s harmful impacts on affordable housing – an estimated reduction of nearly one million affordable homes over the next decade. Though changes are still possible to the House bill, our best opportunity to impact the final outcome remains with the Senate. Still, advocates should capitalize on any opportunity to impact the House process by weighing in with House Republicans to urge them to speak out against the elimination of Housing Bonds and urge them to express their concerns to House Speaker Paul Ryan (R-WI) and Ways and Means Committee Chairman Kevin Brady (R-TX). This will help us position ourselves for upcoming negotiations between the House and Senate. Specifically tell your House members they must:

  • Retain multifamily Housing Bonds; and
  • Make adjustments to offset the impact of a lower corporate rate on Housing Credit investment to ensure that the amount of Housing Credit equity per development is not substantially decreased. 

See the ACTION Campaign statement on behalf of over 2,150 organizations and businesses calling on Congress to make these changes.

Action Needed

Reach out to Republican Senators to:

  • Thank them for retaining both the Housing Credit and Housing Bonds and urge them to tell Chairman Hatch to hold his ground by ensuring these programs are retained in a final bill; and
  • Ask that they convey support to Chairman Hatch for retaining the production power of the Housing Credit in a lower corporate rate environment. 

Reach out to Republican Representatives to:

  • Ask that they convey support to Speaker Ryan and Chairman Brady for Restoring multifamily Housing Bonds; and
  • Ask them to tell Speaker Ryan and Chairman Brady that they must also retain the Housing Credit's production power in a lower corporate tax rate environment. 

While we will continue to look for opportunities to advance the proposals in the Affordable Housing Credit Improvement Act through tax reform or other legislation, our most pressing priority in tax reform is preserving both the Housing Credit and Housing Bond programs, and sustaining Housing Credit investment.

Visit the ACTION Campaign website for more information and advocacy materials, including:

If you have any questions, please contact Emily Cadik, Director, Public Policy, Enterprise Community Partners, at ecadik@enterprisecommunity.org or 202-403-8015, or Jennifer Schwartz, Assistant Director for Tax Policy and Advocacy, National Council of State Housing Agencies, at jschwartz@ncsha.org or 202-624-7758.

As House Wraps Up Tax Reform Mark-up, Senate Poised to Unveil Tax Reform Bill - Outreach Needed

The House Ways and Means Committee is completing consideration of the "Tax Cuts and Jobs Act, H.R. 1" while the Senate prepares to release its own tax reform bill this week. Now is an absolutely critical time for the ACTION Campaign to weigh in with members of Congress to save multifamily Housing Bonds and the Housing Credit production that those bonds make possible. While we continue to try to pursue changes to the House bill before it goes to the floor for a vote, we must influence the Senate bill today before its expected release tomorrow

Just as the House has moved quickly on tax reform in recent weeks, the Senate will also follow an aggressive timeline, with the goal of advancing tax reform legislation through both chambers before Thanksgiving. Weighing in now is critical -- see below for more details, specific action items and advocacy tools.

Senate Tax Reform Bill

The Senate Finance Committee is expected to release its own tax reform legislation after the House concludes its mark-up, which could come as soon as tomorrow. Significant differences between the House and Senate bills are expected, and we are working to ensure the Senate's bill will retain Private Activity Bonds, and in particular, multifamily Housing Bonds. Housing Bonds are responsible for roughly half of Housing Credit production because they trigger the 4 percent Credit. Without these bonds, the 4 percent Credit program would be effectively eliminated. Outreach today is absolutely vital.

Action needed: Educate Senators about the connection between multifamily Housing Bonds and the Housing Credit, and the devastating impact of the House's bill on affordable housing. Ask Senators to convey their support to Senate Finance Committee Chairman Orrin Hatch (R-UT) and Senate Majority Leader Mitch McConnell (R-KY) for 1) retaining the Housing Credit and Housing Bonds, and 2) making other adjustments to the Housing Credit to offset the impact of a lower corporate rate.

House Tax Reform Bill

The House Ways and Means Committee has been marking up the “Tax Cuts and Jobs Act” this week, and intends to finalize the legislation and send it to the House floor for an anticipated vote next week. This bill would have devastating impacts on affordable housing production nationwide -- the proposed elimination of Private Activity Bonds and the reduction in the corporate tax rate without modifications to sustain Housing Credit production would reduce the future supply of affordable rental housing by nearly one million units, according to Novogradac & Co.

There has been no indication that the Committee intends to make substantive changes that impact affordable housing during the mark-up, either to restore the tax exemption on multifamily Housing Bonds or to include modifications to sustain the Housing Credit's production potential under a reduced corporate tax rate. However, these types of changes to the bill may be made before it goes to the House floor for a vote. 

Action needed: Reach out to House Republicans, both on and off the Ways and Means Committee, asking that they reach out to Speaker Paul Ryan (R-WI) and Ways and Means Chairman Kevin Brady (R-TX) to urge them to 1) preserve Housing Bonds, and 2) make other adjustments to the Housing Credit to offset the impact of a lower corporate tax rate. Ask them to at least publicly voice their concern about the impact of eliminating Private Activity Bonds, either as part of the Committee mark-up for members on the Ways and Means Committee, or in the press. 

Advocacy Materials

New resources have been added to the Advocacy Toolkit on the ACTION Campaign website to assist in your outreach efforts. These include:

Visit the ACTION Campaign website for more information and advocacy materials.

If you have any questions, please contact Emily Cadik, Director, Public Policy, Enterprise Community Partners, at ecadik@enterprisecommunity.org or 202-403-8015, or Jennifer Schwartz, Assistant Director for Tax Policy and Advocacy, National Council of State Housing Agencies, at jschwartz@ncsha.org or 202-624-7758.

House GOP Tax Reform Bill Retains Housing Credit, But Repeals Housing Bonds

House Ways and Means Committee Chairman Kevin Brady (R-TX) has released the “Tax Cuts and Jobs Act” (see bill text and summary), which would:

  • Lower the top corporate tax rate from 35 percent to 20 percent, effective January 1, 2018.
  • Retain the Low-Income Housing Tax Credit (Housing Credit) with no proposed modifications.
  • Eliminate the tax exemption on private activity bonds, including multifamily Housing Bonds, which provide critical financing to roughly half of all Housing Credit developments. 

Despite maintaining the Housing Credit, the bill would devastate production under the program by eliminating private activity multifamily Housing Bonds. Over half of Housing Credit developments utilize tax-exempt bonds and 4 percent Housing Credits. Eliminating the tax exemption would eliminate these bond/4 percent transactions after 2017.

Coupled with the lower corporate tax rate, which would reduce investor interest in the Housing Credit without other changes to the Credit, the loss of Housing Bonds could reduce annual production by up to two-thirds annually.

Next Steps

Chairman Brady will develop a “chairman’s mark” over the weekend, which will include modifications to the legislative text released today – and provides an opportunity to weigh in to encourage the Committee to restore multifamily Housing Bonds and make other changes to offset the negative impact of other tax reforms. The House Ways and Means Committee will begin its mark-up of the legislation on Monday, November 6, which may last several days before it is sent to the House floor.

The Senate is expected to release its own legislation as soon as next week, with a mark-up the week of November 13. We do not expect the Senate bill to mirror the House bill and will be working to ensure that the Senate understands the devastating impact of the House’s bill on affordable housing. The goal is for each chamber to pass tax reform legislation on the floor by Thanksgiving, work out the differences in a conference committee in December, and have the President sign tax reform into law by the end of the year.

Action Needed

Now is a critical time to weigh in with members of Congress urging them to:

  • Preserve the tax exemption on multifamily Housing Bonds. Without Housing Bonds, Housing Credit development could be reduced by as much or more than 50 percent annually.
  • Make adjustments to offset the impact of a lower corporate rate on Housing Credit investment to ensure that the amount of Housing Credit equity per development is not substantially decreased. More detailed proposals on the adjustments needed are forthcoming, but in the meantime we encourage advocates to simply convey the message that modifications will be needed.

ACTION has released a statement that we encourage you to send to your representatives.

Visit the Advocacy Toolkit for more resources to advocate for the Housing Credit and Housing Bonds.

If you have any questions, please contact Emily Cadik, Director, Public Policy, Enterprise Community Partners, at ecadik@enterprisecommunity.org or 202-403-8015, or Jennifer Schwartz, Assistant Director for Tax Policy and Advocacy, National Council of State Housing Agencies, at jschwartz@ncsha.org or 202-624-7758.

Congress Passes Budget Resolution Laying Groundwork for Tax Reform

The House narrowly passed the Senate’s fiscal year (FY) 2018 budget resolution today in a move that formally paves the way for Congress to pass tax reform legislation through the reconciliation process, allowing legislation to pass with only 50 votes in the Senate, as the Vice President could act as the tie breaker if the votes are evenly split. The budget resolution also allows the federal government to increase its debt by $1.5 trillion over the next ten years in order to lower tax rates.

Last month, Administration and Congressional Republican leadership released a “Unified Framework for Fixing Our Broken Tax Code,” which seeks to lower the top corporate tax rate to 20 percent and eliminate “numerous” corporate tax expenditures in order to help achieve the lower rate. The Housing Credit is one of only two corporate tax expenditures that the framework explicitly proposed to retain. The framework is silent on the tax-exemption for multifamily Housing Bonds, which provide critical financing to nearly half of all Housing Credit projects, although it is our understanding from various reports that the authors of the framework have a general agreement to fully retain the tax-exemption on municipal bonds, which include Housing Bonds.

House Ways and Means Committee Chairman Rep. Kevin Brady (R-TX) is expected to release the text of the Committee’s tax reform legislation on November 1, with the goal of holding a markup the week of November 6th and a full vote in the House the week of November 13th. The Senate is expected to follow closely behind the House, with a potential markup in the Senate Finance Committee the week of November 13th. The White House has also set an aggressive timeline by signaling its desire to have President Trump sign a tax reform bill into law before the year's end.

The tax reform process will move quickly over the come weeks, so now is a critical time for all Housing Credit stakeholders to reach out to Congress in support of the Housing Credit and Housing Bonds. Last week the ACTION Campaign sent a letter to Congress and the Administration signed by over 2,150 organizations and businesses, urging them to retain the Housing Credit and Housing Bonds, enact the Affordable Housing Credit Improvement Act, and make any other adjustments needed to ensure that the Housing Credit is not negatively impacted by a lower corporate rate or other changes in tax reform. Visit our Advocacy Toolkit for more resources to advocate for preserving, strengthening and expanding the Housing Credit and Housing Bonds in tax reform.

October ACTION Update: 2,150 Organizations Urge Congress to Preserve, Strengthen and Expand the Housing Credit

ACTION Sends Letter to Congress in Support of the Housing Credit and Housing Bonds in Tax Reform

The ACTION Campaign sent a letter to Congress and the Administration last week on behalf of 2,152 national, state and local organizations and businesses in support of the Housing Credit and Housing Bonds in tax reform. The letter thanks congressional and administration Republican leadership for recognizing the value of the Housing Credit in the “Unified Framework for Fixing Our Broken Tax Code,” and urges lawmakers to not only retain the Housing Credit in tax reform, but to also make the following modifications to modernize our affordable housing delivery system:

  • Retain the tax exemption on multifamily Housing Bonds,
  • Enact the Affordable Housing Credit Improvement Act, and
  • Make adjustments to the Housing Credit to ensure its production potential is not negatively impacted by other changes in tax reform.

We would like to welcome the more than 100 new ACTION Campaign members who signed our letter to Congress and joined our efforts to advocate to preserve, strengthen and expand the Housing Credit and Housing Bonds.

Tax Reform Process Advances, Rep. Tiberi Announces Departure from Congress

The Senate passed its fiscal year 2018 budget resolution last week, which includes language that paves the way for tax reform to advance through budget reconciliation and allows lawmakers to add up to $1.5 trillion to the deficit in tax cuts. Though the House had passed its own budget resolution earlier this month with significant differences from the Senate’s resolution, the House is expected to vote on the Senate’s budget resolution this week in hopes of avoiding a conference between the two chambers and expediting the tax reform process.

Meanwhile, Congress is proceeding with negotiating and drafting tax reform legislation. House Ways and Means Committee Republicans are meeting this week with the goal of finalizing tax reform details, and are expected to release draft legislation as soon as this week, with a markup to follow shortly after. The coming weeks and months as tax reform details are negotiated will be critical for the Housing Credit and Housing Bonds.

Representative Pat Tiberi (R-OH-12), the lead Republican sponsor on the House version of the Affordable Housing Credit Improvement Act (H.R. 1661) and a longtime champion of the Housing Credit, announced last week that he will leave Congress no later than January 31, 2018, nearly a year before his term ends. ACTION thanks Rep. Tiberi for his longstanding leadership on affordable housing, and will work with Rep. Tiberi to identify a new lead House Republican champion for the Housing Credit.

Housing Credit Legislation Gains New Co-Sponsors

The Affordable Housing Credit Improvement Act continues to gain strong bipartisan support in both the House (H.R. 1661) and Senate (S. 548). Eight additional co-sponsors have joined the House bill since last month, including Representatives Carol Shea-Porter (D-NH-1), Elise Stefanik (R-NY-21), Vicky Hartzler (R-MO-4), Daniel Donovan (R-NY-11), Ryan Costello (R-PA-6), Luis Correa (D-CA-46), Patrick McHenry (R-NC-10), and Beto O’Rourke (D-TX-16). With 56 Democratic co-sponsors and 53 Republican co-sponsors, H.R. 1661 has more than one-quarter of the House signed on in support of the Housing Credit and Housing Bonds, a tremendous display of support for the program heading into tax reform.

The Senate version of the Affordable Housing Credit Improvement Act (S. 548) also continues to gain support, with Senator Lindsey Graham (R-SC) joining as a new co-sponsor this month. This brings the total number of co-sponsors to 21, with 11 Democrats, one Independent and nine Republican co-sponsors.

New Fact Sheets Highlight the Impact of the Housing Credit for Native American and Supportive Housing Populations

ACTION has released two new fact sheets that highlight how the Affordable Housing Credit Improvement Act will improve the development of affordable rental housing for Native Americans and for households needing supportive housing services. These new fact sheets are part of a series that depicts how the Affordable Housing Credit Improvement Act can benefit specific communities. Earlier fact sheets identified the Housing Credit’s benefits for rural and senior communities, as well as the preservation and recapitalization of existing affordable housing. Access these fact sheets, along with other advocacy resources to support the Housing Credit, in ACTION’s Advocacy Toolkit.

More Than 2,150 Organizations and Businesses Send Letter to Congress in Support of the Housing Credit and Housing Bonds

The ACTION Campaign sent a letter to Congress today on behalf of more than 2,150 national, state and local organizations and businesses thanking Republican leadership for recognizing the value of the Low-Income Housing Tax Credit (Housing Credit) in the “Unified Framework for Fixing Our Broken Tax Code,” and urging lawmakers to not only preserve the credit, but to include the following provisions to strengthen and modernize our affordable housing delivery system:

  • Retain the tax exemption on multifamily Housing Bonds,
  • Enact the Affordable Housing Credit Improvement Act, and
  • Make adjustments to the Housing Credit to ensure its production potential is not negatively impacted by other changes in tax reform.

Read the letter and view a list of signatories here.

The Housing Credit was one of only two corporate tax expenditures that the Administration and Congressional Republican leadership explicitly proposed to retained in their tax reform framework, noting that it is a tax incentive that has “proven to be effective in promoting policy goals important in the American economy.” However, the framework was silent on multifamily Housing Bonds and private activity bonds generally. It is our understanding from various reports that the authors of the framework have a general agreement to fully retain the tax-exemption on municipal bonds, which include Housing Bonds, but now is a critical time to reinforce the importance of doing so.

Now that the House and Senate have passed their respective budget resolutions that lay the groundwork for tax reform, the House is expected to vote on the Senate's version next week, after which the House and Senate tax-writing committees will move quickly to try to finalize tax reform before the end of the year. The House Ways and Means Committee is aiming to hold a markup of a tax bill in the next few weeks, with the Senate to follow soon after. The coming weeks and months, as congressional tax-writers finalize these details, will be critical for the Housing Credit and Housing Bonds.

We thank all new organizations and businesses for joining the ACTION Campaign and urge all ACTION members to visit our Advocacy Toolkit to find resources to advocate for the Housing Credit and Housing Bonds.

Deadline Extended to Sign on to Support the Housing Credit and Housing Bonds in Tax Reform

The deadline to sign on to the ACTION Campaign letter to Congress and the Administration has been extended to Tuesday, October 17. Please sign on and share with your networks today. Thank you to everyone who has already signed on to show strong support for the Housing Credit and Housing Bonds in tax reform.

The letter thanks Republican congressional and administration leadership for recognizing the value of the Housing Credit in their unified framework for tax reform, and urges them to not only preserve the credit, but to include the following provisions to strengthen and modernize our affordable housing delivery system:

  • Retain the tax exemption on multifamily Housing Bonds,
  • Enact the Affordable Housing Credit Improvement Act, and
  • Make adjustments to the Housing Credit to ensure its production potential is not negatively impacted by other changes in tax reform.

Read the letter, sign on and share.

There are currently 2,103 organizations and businesses signed on to the letter in support of the Housing Credit and Housing Bonds. Please check the list of ACTION members to make sure that your organization has signed on, and share the letter with your networks to help us show broad support for the Housing Credit. 

If you have any questions or want to remove your organization from the letter, contact Emily Cadik at ecadik@enterprisecommunity.org before the October 17 deadline.    

Sign on to Support the Housing Credit and Housing Bonds in Tax Reform

Administration and Congressional Republican leadership recently released their “Unified Framework for Fixing Our Broken Tax Code,” which proposes to lower the top corporate tax rate to 20 percent, eliminate most corporate tax expenditures in order to help achieve the lower rate, and make numerous other changes to the existing tax system.

The Low-Income Housing Tax Credit (Housing Credit) is one of only two corporate tax expenditures that the framework explicitly proposes to retain, noting that it is a tax incentive that has “proven to be effective in promoting policy goals important in the American economy.” While the framework does not speak to multifamily Housing Bonds, it is our understanding from various reports that the authors of the framework have a general agreement to fully retain the tax-exemption on municipal bonds, which include Housing Bonds. Read more about the framework and its impact on affordable housing.

Now that the framework has been released, the House and Senate tax-writing committees are negotiating details and drafting tax legislation. The House Ways and Means Committee is expected to hold a markup of a tax bill as early as the week of October 23, and the Senate will follow shortly after. The coming weeks and months, as congressional tax-writers finalize these details, will be critical for the Housing Credit and Housing Bonds.

The ACTION Campaign is sending a letter to Congress and the Administration that thanks Republican congressional and administration leadership for recognizing the value of the Housing Credit, and urges them to not only preserve the credit, but to include the following provisions to strengthen and modernize our affordable housing delivery system:

  • Retain the tax exemption on multifamily Housing Bonds,
  • Enact the Affordable Housing Credit Improvement Act, and
  • Make adjustments to the Housing Credit to ensure its production potential is not negatively impacted by other changes in tax reform.

Read the letter and sign on. The deadline for signing on is Friday, October 13.

All existing ACTION Campaign members will be included in the letter, so if you are already an ACTION Campaign member you do NOT need to sign on. However, we encourage you to share the letter with your networks to help us show broad support for the Housing Credit. 

If you have any questions or want to remove your organization from the letter, contact Emily Cadik at ecadik@enterprisecommunity.org before the October 13 deadline.    

 

ACTION Campaign Submits Comments to Senate Finance Committee in Response to Hearing on Business Tax Reform

The ACTION Campaign submitted a statement for the record today in response to the Senate Finance Committee’s September 19 hearing on “Business Tax Reform.”

In our comments, we thank Chairman Hatch and Senator Cantwell for championing the Affordable Housing Credit Improvement Act (S. 548), legislation to strengthen and expand the Housing Credit. We also highlight the important role that the Housing Credit plays in the current business tax system; the benefits that the Housing Credit has for low-income families; the jobs that are created and supported through Housing Credit development; and the economic stimulation that the Housing Credit generates for local economies and communities. 

We also urge the committee to protect both the Credit and multifamily Housing Bonds – a central component of the Housing Credit program – as part of any tax reform effort considered by Congress. As hearing witness Jeffrey D. DeBoer, President and CEO at the Real Estate Roundtable, wrote in his written testimony to the Committee, the Housing Credit is an example of a tax incentive that is “needed to address market failures and encourage capital to flow to socially desirable projects.”

Visit our Advocacy Toolkit for more information about efforts to protect, strengthen, and expand the Housing Credit.

New Fact Sheets Show Impact of Housing Credit in Every Congressional District

By Shaun-Dae Clark and Olivia Barrow

The ACTION Campaign’s district fact sheets, which show the Housing Credit’s impact in each congressional district and the affordable housing needs that still remain in every state, have been updated to reflect the most recent data available.

The data come from HUD’s LIHTC database through 2015, with economic impact multipliers from the National Association of Home Builders. The district fact sheets also include data on cost-burdened renters from the 2015 American Community Survey, and data from the National Low Income Housing Coalition’s 2015 Out of Reach report, showing how many hours a minimum wage worker in each state has to work in order to afford a modest one-bedroom apartment.

We also updated our state fact sheets earlier this month, showing that the Housing Credit has financed 3 million apartments nationwide, providing affordable homes to 7 million low-income families and supporting 3.4 million jobs. However, 11.1 million households still pay more than half of their income towards rent, and the average minimum wage worker has to work 86 hours per week in order to afford a modest one-bedroom apartment, underscoring the need to expand the Housing Credit and invest in communities across the country.

Tax Reform Framework Proposes to Retain the Low-Income Housing Tax Credit

Today the Trump Administration, House Ways and Means Committee and Senate Finance Committee leadership issued a "Unified Framework for Fixing Our Broken Tax Code" that seeks to lower tax rates, simplify the tax code, bring business back into the US, broaden the tax base and encourage economic growth.

The framework proposes to lower the top corporate tax rate to 20 percent, consistent with the House’s tax reform blueprint released in 2016, and eliminate “numerous” corporate tax expenditures in order to help achieve the lower rate.

The Low-Income Housing Tax Credit is one of only two corporate tax expenditures that the framework explicitly preserves, noting that it is a tax incentive that has “proven to be effective in promoting policy goals important in the American economy.” Its inclusion in the plan is a testament to the proven track record of the program, the need for resources to address our nation’s vast and growing shortage of affordable housing, and the strong bipartisan support that the ACTION Campaign and its members have built over many years. The framework also notes that tax rules affecting specific industries will be modernized “to ensure that the tax code better reflects economic reality,” providing an opportunity to strengthen the Housing Credit.

The only other tax expenditure the framework proposes to retain is the Research and Development Credit, which was the sole corporate tax expenditure explicitly retained in the House’s tax reform blueprint. The framework is silent on the tax exemption for private activity bonds, which provide critical financing to more than 40 percent of Housing Credit developments in the form of multifamily Housing Bonds. However, it does indicate that “while the framework envisions repeal of other business credits, the committees may decide to retain some other business credits to the extent budgetary limitations allow.”

Other key features of the plan include:

  • Corporate tax reforms
    • Reducing the top tax rate for certain pass-through and small businesses to 25 percent
    • Allowing immediate expensing of new investments for at least five years
    • Partially limiting interest deductibility
  • International tax reforms
    • Moving from a worldwide to a territorial system to allow companies to repatriate profits without incurring additional taxes
    • Subjecting all overseas profits to a one-time tax
    • Establishing base erosion rules
  • Individual tax reforms
    • Proposing unspecific reforms to the Earned Income Tax Credit
    • Increasing the Child Tax Credit
    • Doubling the standard deduction and eliminating most itemized deductions
    • Compressing the current seven individual tax brackets into seven
    • Repealing the Estate Tax
    • Eliminating the individual Alternative Minimum Tax

The tax reform framework will now be sent to the tax committees in Congress, where the expectation is that details will be worked out through regular order with the ambitious goal of having tax reform signed into law by the end of the year. Tax reform is still anticipated to advance under the budget reconciliation process, meaning it only needs a majority vote in the Senate instead of the typical 60 votes, but also requires near unanimity among the Republican caucus. However, in order to move the bill using reconciliation, Congress must first pass a Budget Resolution providing reconciliation instructions for the tax reform bill. As the health care reform efforts demonstrated, reaching even a simple majority in the Senate can be difficult.

While the framework released today is helpful in understanding the priorities of Congressional leadership and the White House, this initial proposal may be changed significantly as the committees work out details. It is unclear, for example, whether Congress will seek to achieve deficit neutral tax reform, as envisioned in the Budget Resolution passed by the House Budget Committee, or allow for tax reform to add to the deficit, as is currently under consideraion by the Senate Budget Committee. While the Senate Budget Committee has not yet passed a Budget resolution, it is reportedly going to allow for tax reform to cost up to $1.5 trillion over ten years. The tax rate cuts envisioned in the unified framework will likely total more than $1.5 trillion, making offsets necessary regardless of how Congress proceeds with a Budget Resolution.

The coming weeks and months as these details are negotiated will be critical for the Housing Credit and Housing Bonds. Throughout this process the ACTION Campaign will:

  • Thank congressional and administration leadership for recognizing the value of the Low-Income Housing Tax Credit,
  • Advocate to ensure that the Housing Credit is not only retained in tax reform, but also strengthened and expanded,
  • Urge that Congress include the Affordable Housing Credit Improvement Act as part of tax reform, and make additional modifications to offset the impact of a lower corporate rate on Housing Credit investment and subsequent production, and
  • Ensure that the tax exemption on multifamily Housing Bonds is retained.

We will soon be circulating an ACTION sign-on letter to reinforce these messages to Congress and the Administration. 

September ACTION Update: Housing Credit Legislation Surpasses 100 Co-Sponsors in the House

Affordable Housing Credit Improvement Act Surpasses 100 Co-sponsors in the House

The Tiberi-Neal Affordable Housing Credit Improvement Act of 2017 (H.R. 1661) has reached 101 co-sponsors (including Rep. Tiberi) - 48 Republicans and 53 Democrats – with 14 additional members signing on in support of the Housing Credit in the past month. The most recent additions are Representatives Edward Royce (R-CA-39), Bruce Poliquin (R-ME-2), Alan Lowenthal (D-CA-47), Kevin Yoder (R-KS-3), Ron Estes (R-KS-4), John Garamendi (D-CA-3), Ron Kind (D-WI-3), Paul Cook (R-CA-8), Mark DeSaulnier (D-CA-11), Tim Walberg (R-MI-7), Charles Dent (R-PA-15), Claudia Tenney (R-NY-22), Lee Zeldin (R-NY-1), and Steven Palazzo (R-MS-4).

Thank you to all ACTION members for your work in achieving this tremendous milestone, including the many organizations who met with members over the August and September recesses.

The Cantwell-Hatch version of the bill (S. 548) stands at 20 co-sponsors, including Senator Cantwell.

Updated Fact Sheets Show the Impact of the Housing Credit in Every State

The ACTION campaign has released updated fact sheets on the impact of the Housing Credit in each state, including data on the homes created or preserved, jobs supported, and local income and tax revenue generated. The fact sheets also include information on the affordable housing shortages that still remain in each state. Nationwide, the Housing Credit has financed 3 million apartments, providing affordable homes to 7 million low-income families and supporting 3.4 million jobs. However, more than 11 million households still pay more than half of their income towards rent, and the average minimum wage worker has to work 112 hours per week in order to afford a modest two-bedroom apartment, underscoring the need to expand the Housing Credit. The ACTION Campaign’s district fact sheets will be updated with 2015 data in the coming weeks.

New Fact Sheet Shows Benefits of Affordable Housing Credit Improvement Act for Seniors

New fact sheets show the impact of the Housing Credit in senior communities, as well as the provisions in the House and Senate versions of the Affordable Housing Credit Improvement Act that would facilitate additional benefits for this population. These fact sheets are the second in a series of resources that highlight the ways in which the Affordable Housing Credit Improvement Act benefits specific communities and populations. The first fact sheets highlight the provisions in the House and Senate bills that benefit rural communities. Stay tuned for more and visit our Advocacy Toolkit for additional resources.

New Report Finds Strong Housing Credit Operating Performance

CohnReznick has released its sixth survey of Housing Credit properties, which finds that Housing Credit properties are operating better than any period in the program’s history. The report examines how Housing Credit developments are financed, how public-private partnerships foster an efficient use of the capital subsidy, why institutional investors invest in Housing Credits, economic occupancy strength, improvements in debt coverage ratio and overall strong cash flow for Housing Credit properties. The report also details the rising number of low-income renters who need affordable housing. With a 97.8% occupancy rate in 2016 – the highest rate that CohnReznick has seen since it began collecting data – nearly all Housing Credit units are occupied, underscoring the need to expand the Housing Credit to help more of the nation’s 11.2 million severely cost-burdened renter households.

ACTION Groups Highlight the Need to Expand the Housing Credit

Chairman of the National Association of Home Builders, Granger MacDonald, responded to an article published in the Wall Street Journal last week calling for the elimination of the Housing Credit. MacDonald refuted the suggestion that zoning and regulatory reform were a sufficient substitute for providing affordable housing, and affirmed the Housing Credit's impact nationwide in the construction and rehabilitation of over 2.9 affordable homes. "Millions have had their lives transformed by obtaining safe, decent and affordable housing", states MacDonald, and "a bipartisan consensus is emerging on the need to expand the program."

The leaders of several of the country’s largest affordable housing nonprofits also responded to last week’s Wall Street Journal article by reiterating that the “the housing credit should be expanded, not ‘killed.’” These leaders rebutted the article’s claim that local solutions can solve a national crisis; instead, they highlighted the desperate need for affordable housing across the country and touted the Housing Credit’s strong record of success and efficiency. The Affordable Housing Tax Credit Coalition (AHTCC) also responded to the article, writing that the Housing Credit “does precisely what a tax credit should – it encourages an activity that would not otherwise occur, and more efficiently than otherwise could be done.” 

Updated Fact Sheets Show Impact of Housing Credit in Every State 

By Shaun-Dae Clark and Olivia Barrow

The ACTION Campaign’s state fact sheets, which show the impact of the Housing Credit and the affordable housing needs that still remain in every state, have been updated through 2015 to reflect the latest data available.

The data come from the National Council of State Housing Agencies’ 2015 Factbook, with economic impact multipliers from the National Association of Home Builders and data on cost-burdened renters from the 2015 American Community Survey. The fact sheets also use data from the National Low Income Housing Coalition’s 2015 Out of Reach report, showing how many hours a minimum wage worker has to work in order to afford a modest one-bedroom apartment.

Nationwide, the Housing Credit has financed 3 million apartments, providing affordable homes to 7 million low-income families and supporting 3.4 million jobs. However, 11.1 million households still pay more than half of their income towards rent, and the average minimum wage worker has to work 112 hours per week in order to afford a modest-two bedroom apartment, underscoring the need to expand the Housing Credit.

The ACTION Campaign’s district fact sheets will be updated with 2015 data in the coming weeks.

August ACTION Update: Congress Looks Towards Tax Reform After August Recess

Congress Looks Towards Tax Reform Amid Busy September Agenda

Republican leadership continues to signal that a comprehensive tax reform bill will be ready soon after August recess, and the Administration continues to maintain that the President will sign a tax bill before the year’s end. However, while negotiations continue among the “Big Six” – House Speaker Paul Ryan (R-WI), House Ways and Means Committee Chairman Kevin Brady (R-TX), Senate Majority Leader Mitch McConnell (R-KY), Senate Finance Committee Chairman Orrin Hatch (R-UT), National Economic Council Director Gary Cohn and Treasury Secretary Steven Mnuchin – Congress faces a busy legislative agenda this fall – including passing an appropriations bill, negotiating a budget deal to raise spending caps, and raising the debt ceiling.

To sustain momentum for tax reform, House Ways and Means Committee Chairman Kevin Brady (R-TX-8) – joined by Committee Members Peter Roskam (R-IL-6), David Schweikert (R-AZ-6) and Carlos Curbelo (R-FL-26) – touted the GOP’s commitment to tax reform at an event in California last week, but offered few details about provisions likely to appear in a tax reform bill. Congressional leadership will likely continue to hold events to make the case for tax reform, as well as additional hearings on tax reform once Congress returns from recess after Labor Day.

Senate Finance Committee Holds Hearing on Affordable Housing Crisis

On August 1, the Senate Finance Committee held a hearing on America’s Affordable Housing Crisis: Challenges and Solutions during which Committee members heard from witnesses about the need for affordable housing and the importance of passing Senator Cantwell and Chairman Hatch’s legislation, S. 548, the Affordable Housing Credit Improvement Act. The ACTION Campaign submitted a statement for the record last week in response to the hearing.

We encourage local ACTION members to thank their Senators who participated in the hearing and made positive remarks about the Housing Credit.

Local Advocates Urge Lawmakers to Expand the Housing Credit

Recent op-eds in Kentucky and Pennsylvania highlight the positive impact that the Housing Credit has on communities across the country, presenting compelling evidence to support S. 548.

Cathe Dykstra, Chief Possibility Officer, President and CEO of Family Scholar House in Kentucky, wrote in Louisville’s Courier-Journal that the Housing Credit has financed 34,000 affordable homes and generated $3.66 billion in Kentucky over the past 30 years, but there are still over 140,000 households in the state spending more than half their income on rent. She says that the state’s low-income families will not be able to succeed unless there is a significant investment in affordable homes. Dykstra calls on lawmakers to pass S. 548, which would support the development of an additional 12,315 affordable homes and nearly 14,000 jobs in the state.

Phyliss Chamberlain, executive director of the Housing Alliance of Pennsylvania, also wrote about the tremendous impact of the Housing Credit and the affordable housing shortage in her state in The Philadelphia Enquirer. Considering that every dollar of federal tax credits issued has been generating roughly 10 times that amount of investment, Chamberlain argues that expanding the Housing Credit would go a long way towards addressing the state’s immense housing needs, allowing for the development or preservation of an estimated 1,000 additional affordable homes in Pennsylvania than would otherwise be possible.

Affordable Housing Credit Improvement Act Continues to Gain Co-sponsors

The Tiberi-Neal Affordable Housing Credit Improvement Act of 2017 (H.R. 1661) has reached 87 co-sponsors (including Rep. Tiberi), with 10 additional members signing on in support of the Housing Credit in the past month. The most recent additions are Representatives Grace Napolitano (D-CA-32), Lucille Roybal-Allard (D-CA-40), Bob Gibbs (R-OH-7), Judy Chu (D-CA-27), John Shimkus (R-IL-15), Doug LaMalfa (R-CA-1), Eliot Engel (D-NY-16), David Young (R-IA-3), Yvette Clarke (D-NY-9), and Colleen Hanabusa (D-HI-1).

The Cantwell-Hatch version of the bill (S. 548) stands at 20 co-sponsors, including Sen. Cantwell.

ACTION Campaign Submits Comments to Senate Finance Committee in Response to Hearing on Affordable Housing

Yesterday, the ACTION Campaign submitted a statement for the record to the Senate Finance Committee in response to the August 1 hearing on “America’s Affordable Housing Crisis: Challenges and Solutions.” The Affordable Housing Credit Improvement Act (S. 548) featured prominently in the discussion and several witnesses and Committee members from both sides of the aisle made positive comments about the need to strengthen and expand the Housing Credit.

In our comments, we applaud Chairman Hatch and Senator Cantwell for introducing S. 548 and organizing the hearing on affordable housing, and we thank the several other Committee members who have signed on as co-sponsors of S. 548 and expressed support for strengthening and expanding the Housing Credit. We also urge all remaining Senate Finance Committee members to support the Affordable Housing Credit Improvement Act because of its proven ability to revitalize communities, preserve existing investments in affordable housing and meet the growing need for affordable housing across the country, a need that was reiterated extensively throughout the hearing.

We urge the Senate Finance Committee to advance the Affordable Housing Credit Improvement Act this year and protect both the Housing Credit and multifamily Housing Bonds—a central component of the Housing Credit program—as part of any tax reform effort considered by Congress.

Senate Finance Committee Holds Hearing on Affordable Housing

Today the Senate Finance Committee held a hearing on "America’s Affordable Housing Crisis: Challenges and Solutions." In a bipartisan show of support for affordable housing, members of the Committee from both sides of the aisle acknowledged the need for more affordable housing and the role of the Low-Income Housing Tax Credit (Housing Credit) as our nation’s primary tool for increasing the supply of affordable rental housing.

The Affordable Housing Credit Improvement Act (S. 548) featured prominently in the discussion, and there were many comments from witnesses as well as members of the Committee about the need to strengthen and expand the Housing Credit. There are currently 20 Senators signed on as co-sponsors of S. 548, including seven members of the Finance Committee.

The witnesses were:

  • Daniel Garcia-Diaz, Director, Financial Markets and Community Investment, United States Government Accountability Office (GAO). Garcia-Diaz’s testimony focused on the three GAO reports issued on the Housing Credit over the past three years, which reviewed issues of federal administration, state administration and the role of syndicators. He raised findings regarding data collection and IRS oversight of the program, and recommended that further investment be made in oversight of the program. The GAO is currently working on a fourth report on the topic of Housing Credit development costs, which is expected to be completed in early 2018.
  • Grant Whitaker, President and CEO of the Utah Housing Corporation and President of the National Council of State Housing Agencies (NCSHA). Whitaker’s testimony described the scale of the affordable housing crisis and the role of the Housing Credit and Housing Bonds in addressing it, citing specific examples of these programs’ success in helping to house veterans and chronically homeless individuals in Utah. He also encouraged all Senators to co-sponsor S. 548, urging that, “This crisis will only get worse unless we act.”
  • Kathy O'Regan, Professor of Public Policy and Planning at the Furman Center and former Assistant Secretary for the HUD Office of Policy Development and Research. O’Regan’s testimony focused on the increasing number of households experiencing high cost burden, especially among the lowest income renters. She argued that now is an “opportune time to make substantive improvements” to the Housing Credit, citing several key provisions in S. 548, including income averaging, the basis boost for apartments serving extremely low-income tenants, prohibiting local approval requirements, clarifying requirements around the definition of a concerted community revitalization plan, setting a minimum 4 percent Housing Credit rate, and promoting development in Native American communities.
  • Kirk McClure, Professor of Urban Planning at the University of Kansas. McClure’s testimony acknowledged that the Housing Credit is “a good program” but suggested several reforms to promote the use of market studies to ensure that developments are sited in locations with the greatest need, to allow state housing finance agencies to exchange Housing Credit authority for voucher authority, to encourage rehabilitation over new construction, and to promote mixed-income developments.
  • Granger MacDonald, Chairman of the Board of the National Association of Home Builders (NAHB). MacDonald’s testimony stated that “housing affordability has reached crisis proportions,” and that the first step to addressing the crisis is to pass S. 548. He underscored that it is economically infeasible to develop homes that are affordable to low-income renters without the Housing Credit, and enumerated the many benefits of affordable housing for residents – including breaking the cycle of poverty by providing greater stability for residents – as well as the broader economic impacts for communities.

In his opening statement, Senate Finance Committee Chairman Orrin Hatch (R-UT), lead Republican sponsor of the Affordable Housing Credit Improvement Act, described the affordable housing crisis as “a problem that should be ready for a bipartisan solution,” and throughout the hearing expressed support for S. 548 as an important step to make a meaningful dent in the affordable housing crisis. “One reason I support the Housing Credit,” Chairman Hatch said, “is that it keeps decision-making away from D.C., and keeps it in communities while involving the private sector.” Hatch also outlined broader principles for tax reform, including fairness, efficiency, simplicity, and American competitiveness.

Senate Finance Committee Ranking Member Ron Wyden’s (D-OR) opening statement reaffirmed his support for S. 548 and called on the committee to pursue bipartisanship both in advancing this bill and in tax reform more broadly. “Senators Cantwell and Hatch are demonstrating how the two sides can work together on major economic challenges,” Ranking Member Wyden said. “After a heated few weeks in the Senate, I know both sides crave a return to bipartisanship and regular order, and for this committee that would mean tax reform is likely on the horizon.”

In her remarks, Senator Maria Cantwell (D-WA), lead sponsor of the Affordable Housing Credit Improvement Act, highlighted the role of the Housing Credit in serving urban as well as rural communities, and responding to specific needs like veteran homelessness. She emphasized the growth in the number of cost-burdened renter households, citing projections from Enterprise and the Joint Center for Housing Studies that the number of renter households who pay more than half of their income towards rent could grow to nearly 15 million by 2025. Senator Cantwell also underscored the high costs of inaction on the health and criminal justice systems, among others.

Prominent themes in the hearing included:

  • The affordable housing crisis affects every state and all types of communities. Senator John Thune (R-SD) noted that the affordable housing crisis affects rural communities in addition to the urban ones more often associated with the crisis, and asked about provisions in S. 548 to encourage affordable housing development in rural communities (of which there are several). Ranking Member Wyden said, “This crisis is a five-alarm fire across the country.” Senator Sherrod Brown (D-OH) also discussed the mismatch between wages and what it costs to rent housing in his own state, and quoted pediatrician Megan Sandel in describing affordable housing as a “vaccine” that is needed in order to keep children healthy.
  • The Housing Credit is the primary tool to develop more affordable housing. Senator Johnny Isakson (R-GA), a co-sponsor of S. 548, called the Housing Credit “one of the best tools we have,” and confirmed with MacDonald of NAHB that none of the 4,700 affordable apartments that MacDonald had developed would have been possible without the Housing Credit. Several other members and witnesses also acknowledged that the Housing Credit is essentially the only tool the federal government has to add more affordable housing to our nation’s supply.
  • Even successful programs can be made stronger. Ranking Member Wyden, who is an original co-sponsor of S. 548, said that the bill will help us “wring all of the value out of the Housing Credit.” Senator Ben Cardin (D-MD) added that we need “stronger tools available,” and that he is “not squeamish about looking at ways to make programs more effective.” Senator Debbie Stabenow (D-MI) expressed her enthusiasm for the bill as well, indicating that she looks forward to being listed as an official co-sponsor, and discussed Michigan’s specific need for the provision to address planned foreclosures.
  • Private sector and state oversight are critical to the Housing Credit’s success. In response to questions from Senator Chuck Grassley (R-IA) about oversight of the Housing Credit, Whitaker of NCSHA noted that state agencies are deeply involved in monitoring Housing Credit properties, including compliance audits and reviews of financial records, rent rolls and physical conditions. Garcia-Diaz of the GAO also acknowledged the role of the private sector in monitoring the program, noting that while syndicators “don’t relieve the federal government of the responsibility” of overseeing the program, they do “play a unique role in oversight of the Housing Credit.” Senator Isakson also observed that the Housing Credit “has about as many incentives as you can have in a program to take good care of the properties.” “I know it’s hard to track from the GAO’s perspective,” MacDonald of NAHB added, “but at the local level there’s a lot of oversight.”
  • Adjustments to the Housing Credit will be needed in order to offset the impact of a lower corporate rate and other potential changes in tax reform. Even if there are no proposed changes to the Housing Credit in tax reform, other changes to the corporate tax code could negatively impact Housing Credit production. O’Regan of the Furman Center noted that, “any decrease in corporate tax rates also lowers the amount of equity raised by the credit,” and that Housing Credit equity could “decline by up to 17 percent under expected decreases in the corporate tax rate if per-capita allocations are not increased to keep pace.” Senator Thune also asked about the impact of a shorter depreciation period on Housing Credit investment, and MacDonald of NAHB noted that such a change could have a positive impact on Housing Credit pricing.

The ACTION Campaign will provide a statement for the record and encourages other ACTION members to submit statements as well. Statements must be received no later than two weeks following the conclusion of the hearing, and instructions can be found on the committee's hearing webpage. See our submission to the Senate Finance Committee submitted earlier this month for talking points and data regarding the need for affordable housing and the impact of the Housing Credit.

For more information about the Housing Credit and the Affordable Housing Credit Improvement Act, visit our Advocacy Toolkit.

July ACTION Update: Senate to Hold Hearing on Affordable Housing, Tax Reform to Take Center Stage.

Senate Finance Committee to Hold Hearing on Affordable Housing Next Week

The Senate Finance Committee has scheduled a hearing for next Tuesday, August 1, on "America’s Affordable Housing Crisis: Challenges and Solutions." The Housing Credit and the Affordable Housing Credit Improvement Act (S. 548) will feature prominently in the discussion. The witnesses will be:

  • Daniel Garcia-Diaz, Director, Financial Markets and Community Investment, United States Government Accountability Office
  • Grant Whitaker, President and CEO of the Utah Housing Corporation and President of the National Council of State Housing Agencies
  • Kathy O'Regan, Professor of Public Policy and Planning at the Furman Center and former Assistant Secretary for the HUD Office of Policy Development and Research
  • Kirk McClure, Professor of Urban Planning at the University of Kansas
  • Granger MacDonald, Chairman of the Board of the National Association of Home Builders

The ACTION Campaign will provide a statement for the record and encourages other ACTION members to submit statements as well. Statements must be received no later than two weeks following the conclusion of the hearing, and instructions can be found on the committee's hearing webpage.

Tax Reform to Take Center Stage

While Congressional healthcare efforts are still underway, Congress is increasingly turning its attention to tax reform. It remains to be seen whether Congress will be able to pass comprehensive tax reform, or even a more limited tax cut bill, with many unanswered questions, including whether Congress will be able to pass a budget resolution providing reconciliation protections to a tax bill and whether Congressional Republicans will be able to come to an agreement with each other and with the White House on the details of a plan. In the meantime, we wait for a more detailed tax reform plan from the Administration, building off the one-page outline the White House released in April, expected to be released in early September.

Meanwhile, both the Senate Finance Committee and the House Ways and Means Committee have held hearings on tax reform in recent weeks, focusing on the impact of tax reform for small businesses, middle class families, and working individuals. The Housing Credit was featured positively during a July 18 Senate Finance Committee hearing to consider the nomination of David J. Kautter as Assistant Secretary for Tax Policy of the Treasury Department. During the hearing, Senator Maria Cantwell (D-WA) highlighted the critical need for more affordable rental housing in tax reform, saying, “The tax credit drives 90 percent of affordable housing, so if you don’t increase it, we’re not going to increase the supply.” Kautter responded that, “from what I’ve seen [the Housing Credit] works pretty well” and expressed an interest in making the program “even more effective and efficient than it is today.” See the full exchange between Senator Cantwell and David Kautter on the importance of investing in the Housing Credit.

During another July 18 Senate Finance Committee hearing, titled Comprehensive Tax Reform: Prospects and Challenges, Senators from both sides of the aisle discussed the need to lower the corporate tax rate in order to encourage job and wage growth, provide greater fairness within the code, and sustainably (and permanently) reform the tax system through fiscally responsible and revenue-spurring changes. Committee members from both parties expressed a desire to legislate in a bipartisan manner; however, some Democrats voiced concerns that GOP lawmakers may write legislation without Democratic input or not hold hearings in the Committee once a tax reform bill was drafted.

The House Ways and Means Tax Policy Subcommittee also held two hearings this month: How Tax Reform Will Help America’s Small Businesses Grow and Create New Jobs, on July 13, and How Tax Reform Will Simplify Our Broken Tax Code and Help Individuals and Families, on July 19. Both of these hearings explored the principles for comprehensive tax reform outlined in the House GOP tax reform blueprint, “A Pro-Growth Tax Code for All Americans,” released last summer.

Recent Op-Eds Highlight Importance of the Housing Credit Across the Country

Last month, the U.S. Conference of Mayors passed a resolution in support of expanding the Housing Credit and called for increased investment in the nation’s critical affordable housing infrastructure. Eric Enderlin, president of New York City’s Housing Development Corporation, and Christine Hensley from the Des Moines City Council, argue in a recent op-ed in The Hill that consensus between the public officials in NYC and Des Moines -- two very different places -- indicates that the affordable housing crisis is a bipartisan issue that transcends geography and should not go unnoticed by Congress. Enderlin and Hensley urge lawmakers to protect and expand the Housing Credit, which includes supporting the Affordable Housing Improvement Act in the House (H.R. 1661) and Senate (S. 548).

Ralph Perrey, executive director of the Tennessee Housing Development Agency, also wrote this week about the importance of expanding affordable housing resources, specifically the Housing Credit, which is the nation's primary tool to develop new affordable housing. And Matthew Reiger, CEO of Housing Trust Group in Miami, wrote in the Miami Herald that lawmakers must pass the Affordable Housing Credit Improvement Act to support cost-burdened renters in South Florida.

New Resources Highlight Benefits of Affordable Housing Credit Improvement Act for Rural Communities

New ACTION Campaign fact sheets highlight the Housing Credit’s impact in rural areas and the provisions in the Affordable Housing Credit Improvement Act that would make it easier to develop affordable housing in rural areas. See the Senate version and the House version of the new rural fact sheet.

Visit the ACTION Campaign’s Advocacy Toolkit for other advocacy materials, including our new Case for Enhancing the Housing Credit, bill summaries, bill text, "Dear Colleague" letters, sample letters to members of Congress requesting co-sponsorship, and more. 

Affordable Housing Events Taking Place Nationwide During Week of Action

This week, Our Homes, Our Voices is hosting a Week of Action with events planned across the country in support of critical affordable housing programs. Affordable housing stakeholders are encouraged to participate in the events that have been scheduled or coordinate their own local events during the Week of Action.

With members of Congress preparing to return to their districts for the August recess, we also encourage ACTION Campaign members to arrange property tours and site visits for members of Congress and their staff.

Affordable Housing Credit Improvement Act Continues to Gain Co-sponsors

The Tiberi-Neal Affordable Housing Credit Improvement Act of 2017 (H.R. 1661) has reached 77 co-sponsors (including Rep. Tiberi), with 14 additional members signing on in support of the Housing Credit in the past month. The most recent additions are Representatives Joyce Beatty (D-OH-3), Susan Brooks (R-IN-5), Matt Cartwright (D-PA-17), Keith Ellison (D-MN-5), Joseph Kennedy III (D-MA-4), Rosa DeLauro (D-CT-3), Alcee Hastings (D-FL-20), Larry Bucshon (R-IN-8), Darrell Issa (R-CA-49), Chellie Pingree (D-ME-1), Roger Marshall (R-KS-1), Robert Brady (D-PA-1), Scott Taylor (R-VA-2), and Stephen Knight (R-CA-25).

The Cantwell-Hatch version of the bill (S. 548) has reached 20 co-sponsors, including Sen. Cantwell.

With tax reform high on the agenda when Congress returns from August recess, now is a critical time for Housing Credit stakeholders to encourage additional members of Congress to sign on as co-sponsors.