December ACTION Update: Year-End Tax Package Uncertain as Government Shutdown Looms

Year-End Tax Package Uncertain as Government Shutdown Looms

Last week House Ways and Means Chairman Kevin Brady (R-TX) introduced tax legislation that would renew expired tax provisions, make technical fixes to last year's Tax Cuts and Jobs Act, provide incentives for retirement savings, and offer tax relief for natural disaster victims. The tax package also includes a technical correction that would modify the general public use rule for multifamily Housing Bonds to clarify that there is an exemption for properties serving veterans. It is unclear whether lawmakers will move forward with negotiations on this package in the lame duck or wait until the next Congress to consider tax legislation. House Republican leadership intended to vote on the proposal last week, but it was ultimately postponed because a large number of representatives were absent and thus the package lacked the votes to advance.

Complicating matters is the fact that there is limited legislative time remaining this year and lawmakers’ top priority is finalizing fiscal year (FY) 2019 appropriations before the current continuing resolution (CR) funding many government functions expires on December 7. The President has said he will veto any spending package that does not include his requested funding for border security, which would result in a partial government shutdown. However, given former President George H. W. Bush’s passing over the weekend, lawmakers and White House officials are considering a potential one- or two-week CR during the week of national mourning. Despite an unclear path forward, our champions in Congress are looking for any opportunity to advance the minimum 4 percent Housing Credit rate and other provisions from the Affordable Housing Credit Improvement Act.

Opportunities and Challenges for Affordable Housing in the Next Congress

With Democrats taking control of the House and Republicans strengthening their hold in the Senate, the 116th Congress will present both opportunities and challenges for affordable housing priorities. ACTION members in D.C. have been working closely with our congressional champions to prepare for reintroducing the Affordable Housing Credit Improvement Act next year. With Senator Orrin Hatch (R-UT) retiring and Representative Carlos Curbelo (R-FL) losing his bid for reelection, we will be seeking new Republican sponsors in both the House and Senate. And with more than 80 members of Congress not returning to Washington next year, including more than 40 co-sponsors of the Affordable Housing Credit Improvement Act, we will be working hard to educate new members and their staff about the Housing Credit.

In addition to new lead sponsors and a divided government next year, there will also be important changes on the committees that oversee tax legislation, including the Housing Credit. Senator Charles Grassley (R-IA) will become Chairman of the Senate Finance Committee, and Sen. Ron Wyden (R-OR) – a strong supporter of the Housing Credit – will remain Ranking Member. Sen. Grassley is expected to focus on oversight of tax expenditures during his Chairmanship. In the House, long-time Housing Credit supporter and current lead sponsor Rep. Richard Neal (D-MA) will become Chairman of the Ways and Means Committee, with former Chairman Kevin Brady (R-TX) becoming Ranking Member. A top priority for Democrats in the next Congress will be passage of a large infrastructure package, which presents an opportunity to advance affordable housing priorities.

Advocacy in support of the Housing Credit next year will be important to ensure continued momentum. With the recent additions of Senators Shelley Moore Capito (R-WV), Catherine Cortez Masto (D-NV), Kamala Harris (D-CA), and Doug Jones (D-AL), the Affordable Housing Credit Improvement Act (S. 548) has 45 co-sponsors – 11 Republicans, 32 Democrats and 2 Independents. The House version of the Affordable Housing Credit Improvement Act (H.R. 1661) has a total of 181 co-sponsors – 82 Republicans and 99 Democrats. We will hit the ground running next year to rebuild strong support for the Housing Credit.

Updated Fact Sheets Show the Housing Credit’s Impact in Every Congressional District

To support upcoming advocacy efforts, we have updated the ACTION Campaign’s District Fact Sheets with the most recent data to show the Housing Credit’s impact in each congressional district and the affordable housing needs that remain in every state. Last month, ACTION also updated its state fact sheets showing that the Housing Credit has financed more than 3 million apartments nationwide, providing affordable homes to 7.2 million low-income families and supporting 3.4 million jobs. New to both the state and district fact sheets this year are data demonstrating the impact that a 50 percent increase in Housing Credit resources would have in each state. We urge all affordable housing advocates to share these fact sheets with members of Congress and ask for their support of the Housing Credit.

ACTION Submits Comments on CRA Modernization

On November 19, the ACTION Campaign submitted a comment letter to the Office of the Comptroller of the Currency (OCC) urging the regulator to continue to support robust investment in the Housing Credit. The OCC will now review public comments responding to its advance notice of proposed rulemaking (ANPR) before releasing a proposed rule, which offers an additional opportunity for public input. Typically all three federal banking regulators – the OCC, Federal Reserve Board of Governors, and Federal Deposit Insurance Corporation (FDIC) – work together on regulatory changes, but it is yet to be seen whether the Federal Reserve and FDIC will join the OCC in subsequent steps of the rulemaking process.