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111 Representatives Sign Dear Colleague Letter Supporting the AHCIA
On August 25, 111 Democratic Members of the House sent a Dear Colleague letter to House Speaker Nancy Pelosi (D-CA-12) and House Minority Leader Kevin McCarthy (R-CA-23), urging the inclusion of the Affordable Housing Credit Improvement Act (AHCIA) in reconciliation legislation, which is one part of the two-track infrastructure path in Congress. The letter was led by AHCIA House champions Representatives Suzan DelBene (D-WA-01) and Don Beyer (D-VA-08) and was signed by House Democrats only — due to the nature of the reconciliation process, which is expected to pass along party line — but the AHCIA legislation maintains its broad, bipartisan support that continues to grow in both chambers of Congress.
This strong showing of support for the Housing Credit among House members is timely, as Congressional committees are set to move forward in the crafting of the $3.5 trillion reconciliation package. There is currently a non-binding deadline of September 15 for the committees to report their proposals to the Budget Committee. The House will take up the package first, with Ways and Means planning to begin markup of the proposal next week.
ACTION thanks these 111 Members of Congress for their call to swiftly enact the AHCIA. We encourage our members to thank those who signed the letter. While not all provisions of the AHCIA will be eligible for inclusion due to requirements that legislation passed through reconciliation have a budgetary impact, this is a unique opportunity to move some of our key Housing Credit priorities toward enactment. The next couple of weeks are critical for ACTION members to continue advocacy efforts by continuing to ask your legislators to cosponsor the AHCIA and by sharing this Dear Colleague letter widely with House Democrats.
Senate Finance Committee Chair Ron Wyden Releases the DASH Act, Includes AHCIA Provisions
On August 18, Senate Finance Committee Chair Ron Wyden (D-OR) released the Decent, Affordable, Safe Housing for All Act (DASH Act), comprehensive housing legislation that includes a number of Housing Credit provisions from the AHCIA. Specifically, it includes the three major unit financing provisions from the AHCIA – the 50 percent allocation increase for the 9 percent Housing Credit, the lowering of the bond financing threshold from 50 percent to 25 percent, and additional basis boosts for rural, Native American, and extremely low-income communities – which combined would finance as much as 2,015,000 additional affordable rental homes over 10 years. The legislation also includes additional Housing Credit provisions, such as to elect an accelerated first year credit amount to compensate for Covid-related delays, as well as provisions to extend the deadline for rehabilitation expenditures and to extend the deadline for a building to be placed in service and remain eligible for an allocation of Housing Credits.
As Chairman of the Finance Committee, Senator Wyden will play a key role in the drafting of the tax provisions for the Democrats’ infrastructure priorities in the reconciliation package. The proposal is a strong signal from Senator Wyden on what he views as critical affordable housing provisions to be considered for the package, and ACTION applauds his strong championship of the Housing Credit through this legislation. Read more about the DASH Act in a press release announcing the legislation.
NCSHA Urges IRS and Treasury to Extend Housing Credit Covid-19 Relief
On August 13, ACTION co-chair the National Council of State Housing Agencies (NCHSA) sent a letter to the IRS and Treasury urging them to extend certain temporary Housing Credit relief provisions in IRS Notice 2021-12. In light of the continuing disruption of the pandemic on development and construction activities and the ongoing operation of Housing Credit properties, NCSHA encouraged the extension of provisions on the carryover allocation 10 percent test deadline, the minimum rehabilitation expenditure deadline, the placed-in-service deadline, the restoration period for properties suffering casualty loss, occupancy obligations, the noncompliance corrective action period, compliance monitoring tenant file review and physical inspection requirements, and closure of property amenities and common space facilities. The letter also encourages the IRS and Treasury to allow Housing Credit allocating agencies to satisfy QAP public approval requirements using telephonic hearings and to specify that virtual platforms may also be used to satisfy the public approval requirement.
The ACTION Campaign is grateful to the 2,400+ businesses, organizations, and industry partners from across the country who support our work to expand the Housing Credit. Help ACTION grow by asking affordable housing advocates in your networks who are not yet members to join the coalition. Membership is free. The more members that sign on, the better ACTION can demonstrate to Congress the widespread support for the Housing Credit across the country.
In August, ACTION was pleased to welcome the following 6 new members:
Hispanic Unity of Florida, Florida
Envision Homes, Kansas
Amethyst Place, Missouri
Community Basics, Inc., Pennsylvania
Pittsburgh Community Reinvestment Group (PCRG), Pennsylvania
BCM Housing LLC, Texas
Housing Credit Research
In their recent paper, “Invest in America’s Infrastructure by Expanding Access to Affordable Housing,” Henry Cisneros and Pam Patenaude, co-chairs of the Bipartisan Policy Center’s Housing Advisory Council, detail the current lack of and increased need for affordable housing, especially in light of Covid-19. Cisneros and Patenaude highlight the Housing Credit as one of the critical housing programs to expand affordable housing opportunities and choice to individuals with extremely low incomes.
In a new research brief on private activity bonds, the New York City Housing Development Corporation, the New York State Homes and Community Renewal, and the New York Housing Conference analyzed the impact of lowering the Housing Credit 50 percent test in New York and found it could spur the creation of 100,000 additional units of affordable housing over 10 years.
Housing Credit In the News
In “What’s in the $1T infrastructure bill for real estate,” The Real Deal discusses how the two-track infrastructure plan would impact New York’s real estate market, particularly for industry partners including the Associated General Contractors of America and the New York Housing Conference. Highlighting the current affordable housing crisis, New York Housing Conference Executive Director Rachel Fee expressed hope that the budget legislation will expand the Housing Credit by lowering the 50 percent private activity bond threshold – the “50 percent test” – to 25 percent, which could add 10,000 additional affordable housing units each year in New York.
As part of its series on affordable housing, Propmodo published an exposé – “The 35-Year-Old Tax Credit Shaping Affordable Housing Development” – outlining the history of the Housing Credit and related growth of the tax-incentivized affordable housing sector. The piece also explores how municipal governments have implemented local incentives such as density bonuses to encourage further investment in mixed-income developments that include Housing Credit properties.
In “Bay Area mayors, advocates urge Congress to invest in housing,” the San Jose Spotlight discusses a letter sent by a coalition of more than 20 city officials, nonprofits and philanthropic organizations to the region’s congressional delegation calling for additional resources to address the ongoing housing shortage. The letter urges these lawmakers to expand the housing voucher program, invest in affordable housing, and strengthen the Housing Credit to spur affordable housing production in one of the most expensive housing markets in the country.