February ACTION Newsletter: Legislative and Regulatory Updates

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The ACTION Campaign monthly call will be held on Friday, February 12 at 2:00 PM EST.

*Please note the change in schedule for our February monthly call, which has been rescheduled to next Friday. Our regular call schedule will resume in March.

ACTION Updates

Legislative and Advocacy Update

Almost a month into the 117th Congress, the ACTION Campaign is continuing its work to build on a strong end to 2020, following the enactment of the permanent, minimum 4 percent Housing Credit rate. ACTION is preparing for the reintroduction of the Affordable Housing Credit Improvement Act with our champions on the Hill and monitoring for potential legislative vehicles that could carry our Housing Credit priorities. We will continue to monitor and update our members and supporters on any key legislative activity, so that we can mobilize our advocacy efforts quickly when the time is right.

Biden Administration Confirmations and Nominees

The ACTION Campaign will continue our engagement with administration officials at the Treasury, HUD, and the USDA. ACTION congratulates recently confirmed Treasury Secretary Janet Yellen, who voiced her support for the Housing Credit during her January 19 confirmation hearing. She stated: “[The affordable housing crisis] is a huge problem…and we really need to devise effective ways to work on this and support affordable housing. Things like the Low-Income Housing Tax Credit I think have been very important” [Timestamp: 2:49:40]. Representative Marcia Fudge (D-OH-11), President Biden’s nominee for HUD Secretary, also supports the Housing Credit, cosponsoring the AHCIA in both the 115th and 116th Congress. Tom Vilsack, former USDA Secretary under the Obama administration, has been nominated by President Biden to re-head the agency, which bears important implications for rural development. ACTION looks forward to working with Treasury, HUD, and the USDA to strengthen the Housing Credit.

ICYMI. In December, ACTION sent a memo to the Biden administration agency transition teams at Treasury, HUD, and the USDA on legislative and regulatory actions to strengthen the Housing Credit. 

Comments on Federal Reserve ANPR to Modernize CRA due February 16

President Biden has yet to appoint a new head of the Office of the Comptroller of the Currency (OCC). The OCC is one of the three banking regulators charged with overseeing Community Reinvestment Act (CRA) compliance, and 85 percent of annual Housing Credit equity investment is CRA-driven. In October, the Federal Reserve (Fed) – another of the three banking regulators – issued an advance notice of proposed rulemaking in an effort to modernize the CRA. It is possible that the OCC, the Fed, and the Federal Deposit Insurance Corporation – the third banking regulator – will work together from this proposed rule towards one, final CRA rule in 2021. Comments on the Fed’s ANPR are due on February 16, and the ACTION Campaign will submit a letter to encourage CRA regulations that facilitate investment in affordable housing through the Housing Credit program.

IRS Notice 2021-12 Provides Additional Housing Credit Regulatory Relief for Covid-19

On January 15, the IRS issued Notice 2021-12 to provide additional Covid-19 relief measures for the Housing Credit program. This notice extends all provisions in Notice 2020-53, which the IRS released in July of 2020 to provide initial regulatory relief for the Housing Credit program, including the 10 percent test deadline, rehabilitation expenditure deadline, and the year-end restoration period deadline for properties suffering a casualty loss. It also extends the temporary waivers of state agency compliance monitoring and tenant income recertifications requirements, among other provisions.

Notice 2021-12 also includes some new areas of relief not previously provided under Notice 2020-53, namely, an extension of the placed-in-service deadline through December 31, 2021 for projects with a deadline within the close of calendar year 2020 and allowing state agencies to conduct QAP hearings telephonically. For a complete list of the relief provided in Notice 2021-12, see NCSHA’s Housing Credit COVID-19 Relief Matrix.

ACTION Membership

The ACTION Campaign is pleased to welcome the following new members, who joined our coalition in January:

  • Kentucky Affordable Housing Coalition, Kentucky

  • Lynchburg Redevelopment and Housing Authority, Virginia

  • Key Bank, National

ACTION is the largest coalition of Housing Credit advocates in the country. Help our coalition continue to grow by inviting your state and local partners to join ACTION.

Housing Credit Research

  • Freddie Mac released a report called, Spotlight on Underserved Markets: LIHTC in Rural Persistent Poverty Counties. The report details how the Housing Credit program is essential to serving rural Persistent Poverty Counties (PPCS), where low-income levels and low population densities create challenges in building affordable housing. It finds that the Housing Credit supports 40.1 percent of the multifamily housing stock in rural PPCs – where the average income is approximately 43 percent lower than the national average and 28 percent lower than the rural average. For rural PPCs, the report finds that the Housing Credit acts as a critical financing tool to make projects more economically feasible.

  • The Urban Land Conservancy (ULC), a Denver-based affordable housing non-profit, has released a report called, The Benefits of Using Community Land Trusts with Low Income Housing Tax Credits. The ULC report details its community land trust model, which eliminates the cost of land acquisition for developers. The ULC retains ownership of the land and enters into a renewable 99-year ground lease with developers, who build, own, and operate buildings on ULC-owned grounds. The report details the successful development of two new affordable housing projects in Colorado through combining the Housing Credit and community land trust ground leases.

Housing Credit In the News

Krista D'Alessandro is the senior tax policy analyst at Enterprise Community Partners. The ACTION Campaign is co-chaired by Enterprise and the National Council of State Housing Agencies.

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