Administration Shows Continued Support for Housing Credit in FY 17 Budget

 

Today the Obama Administration released its FY 2017 budget request, which demonstrated a continued commitment to expanding and strengthening the Housing Credit. The Administration notes that the “agencies in charge of allocating [Housing Credits] are often confronted with a larger number of deserving projects than they can support,” and that expanding the Housing Credit “would allow the development of some projects for which the current supply is insufficient.” The ACTION Campaign strongly agrees that an expansion of the Housing Credit is needed for these reasons and more.

Five Housing Credit proposals were carried over from previous budgets. There is only one entirely new proposal for FY 2017, related to affirmatively furthering fair housing. One proposal from the FY 2016 budget, related to modifying the Housing Credit rate formula, was not included in FY 2017. The tax extenders legislation passed at the end of 2015, which made permanent the minimum 9 percent Housing Credit rate for new construction and substantial rehabilitation, addressed the need for an alternate credit rate formula for this type of credit. 

The Administration proposes to:

  1. Expand the Housing Credit through PAB conversion
  2. Allow income averaging in Housing Credit properties
  3. Add fair housing as an allocation preference (new proposal)
  4. Add preservation as a selection criteria
  5. Remove the QCT population cap
  6. Protect victims of domestic abuse

Read our analysis of the Housing Credit provisions in the President's FY 17 budget and see the Housing Credit provisions excerpted from the Treasury Department's budget request.

 

Updated Fact Sheets Show Housing Credit Impact in Every Congressional District

Today the ACTION Campaign released an updated set of fact sheets showing the impact of the Housing Credit in every congressional district, including the number of affordable apartments created or preserved, the jobs that Housing Credit development supports and other benefits to local economies.

For the first time, the fact sheets also include data on the number of renter households in the state paying more than half of their income in rent, based on an analysis of the 2013 American Community Survey. There are over 26 million renters in the U.S., or roughly 11 million renter households, paying more than half of their income in rent. No state is immune from the affordable housing crisis – the number of severely cost burdened renters ranges from roughly 25,000 in Wyoming to an astounding 4.8 million in California. While this data is not available at the district level, this state-level data helps make the case for how much affordable housing is still needed around the country.

The district fact sheets use the latest data from the HUD Low-Income Housing Tax Credit database, which includes data on apartments placed in service from 1987 - 2013, and economic impact multipliers from the National Association of Home Builders. The fact sheets for at-large districts use data from the National Council of State’s Housing Agencies’ 2013 Factbook instead of the 2013 HUD data.  

The ACTION Campaign has also released a set of fact sheets showing the impact of the Housing Credit in every state.

ACTION Campaign Applauds Congress for Making Permanent the Minimum 9 Percent Low-Income Housing Tax Credit Rate

On behalf of over 1,000 national, state and local affordable housing stakeholders, the ACTION Campaign applauds Congress for making permanent the minimum9 percent Low-Income Housing Tax Credit (Housing Credit) rate in the Protecting Americans from Tax Hikes Act of 2015. President Obama is expected to sign the bill into law this afternoon.

The permanent minimum 9 percent rate is a victory for affordable housing and a testament to the strong bipartisan support for the Housing Credit that the ACTION Campaign has built. It is also a reflection of the leadership of Senators Cantwell and Roberts, Representatives Tiberi and Neal, and the many other bipartisan Housing Credit supporters in Congress who have championed the Housing Credit and worked for years to advance this provision.

While technical in nature, the permanent minimum 9 percent credit rate will significantly strengthen the Housing Credit by streamlining program administration, increasing predictability, and empowering states to allocate more Housing Credit equity in properties as needed for financial feasibility. This flexibility is especially important for financing developments that serve people with some of the most acute housing needs, such as veterans and people with disabilities.

Since it was signed into law in 1986, the Housing Credit has financed over 2.8 million homes, making rent affordable for roughly 6.5 million low-income families. It has also supported more than 3 million jobs while bringing $100 billion in private investment into communities throughout the U.S.

At a time when our nation’s affordable housing crisis is vast and growing – with over 11 million low-income renters paying more than half of their income towards rent – the ACTION Campaign will continue to work with Congress to further strengthen and expand the Housing Credit.

See the ACTION Campaign statement on the Protecting Americans from Tax Hikes Act of 2015.

NAHB Estimates the Number of People Benefiting from the Housing Credit

The National Association of Home Builders (NAHB) has released an analysis of how many people have benefited from the Housing Credit since its creation in 1986. While it is often cited that the Housing Credit has created or preserved nearly 2.8 million affordable rental homes, the NAHB estimate is the first to reflect the impacts for the primary beneficiaries of the program – the low-income households who live in Housing Credit apartments.

According to NAHB, approximately 6.5 million low-income households, or roughly 13.3 million people, have lived in affordable apartments financed by the Housing Credit between 1986 and 2013. “This is a significant total and illustrates the important role the Housing Credit has played in terms of providing high quality, affordable rental housing,” said Robert Dietz, NAHB’s Vice President for Tax and Market Analysis.

NAHB’s estimate took into account the number of Housing Credit-financed apartments from the National Council of State Housing Agencies’ Factbook, the years the apartments were placed in service from HUD’s LIHTC Database, average turnover rates for renter households from the American Housing Survey, and average household size from the American Community Survey.

Read the full analysis at the Eye on Housing blog.