Join the ACTION Campaign Monthly Call
The ACTION Campaign monthly call will be held on Friday, May 6 at 2:00 PM EDT. Please find the Zoom call information below, and download and import the iCalendar (.ics) files to your calendar system.
Join Zoom Meeting:
- Meeting ID: 976 9100 9830
- Password: 314424
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Legislative State of Play
Several Members of Congress have indicated in the last couple of weeks that discussions around the Build Back Better Act (BBB), or reconciliation package, are resuming, though skepticism about the feasibility and timing remains high. Another unknown is how far back the reconciliation package would need to be scaled to gain support from Senator Manchin. Discussion has mostly focused on taxes, climate, and prescription drug reform, but the door is not closed on other provisions, including our Housing Credit priorities—at least not yet.
Congress is faced with an expiration of the current reconciliation instructions at the end of Fiscal Year 2022 on September 30. The ACTION Campaign continues to engage with Congressional decision-makers on the need to include Housing Credit production provisions given the growing shortage of affordable housing and the role housing plays in inflation. In a recent meeting with Majority Leader Schumer’s staff, ACTION partners were told the time is now to weigh in with Democratic Senators on the Housing Credit, with Memorial Day being the most current impending, albeit self-imposed, deadline. ACTION encourages our members and partners to contact Democratic Senators in their states to elevate our Housing Credit priorities and to report back on any key takeaways.
At the same time, ACTION Campaign continues to build cosponsorship for the Affordable Housing Credit Improvement Act (AHCIA), H.R. 2573 and S.1136. In April, we added three new Republican cosponsors in the House and two new Democratic cosponsors in the Senate. The new House cosponsors are Representatives Bill Johnson (R-OH-06), Mike Carey (R-OH-15), and Gregory Murphy (R-NC-03), bringing the total in the House to 158 cosponsors (99 Democrats and 59 Republicans), comprising 74 percent of the Ways and Means Committee. In the Senate, the new cosponsors include Senators Raphael Warnock (D-GA) and Martin Heinrich (D-NM), bringing the total in the Senate to 34 cosponsors (24 Democrats and 10 Republicans), comprising 50 percent of the Senate Finance Committee.
Please join us in thanking these Members of Congress for their support for strengthening and expanding the Housing Credit and check out ACTION’s updated cosponsorship list to see the Representatives and Senators currently signed on. ACTION is continuing our advocacy outreach to build cosponsorship for the legislation and encourage our members and partners to help us keep building support through outreach to your Members of Congress if they have not yet signed onto the AHCIA.
Other Housing Credit Updates
International Tax Deal Could Impact Housing Credit
On April 5, the ACTION Campaign joined 29 other national community development associations and trade organizations in signing a letter to Treasury Secretary Janet Yellen, detailing concerns over a proposed global minimum tax that could have significant ramifications for business tax credits, including the Housing Credit. The proposal is part of a two-pillar international tax reform plan released by the Organization for Economic Cooperation and Development (OECD), a cross-governmental organization that acts as a strategic advisor to the G20 international forum.
The objective of the international plan is to address the challenges arising from the digitalization of the economy by ensuring that large companies pay taxes where they operate and earn profits through the creation of a global minimum tax of at least 15 percent. In the letter to Secretary Yellen, advocates warn the minimum tax could discourage investor participation in critical affordable housing and community development programs incentivized through the tax code in the United States. Senate Finance Committee Republicans also weighed in on the matter, expressing their opposition to the OECD agreement. A handful of countries have also opposed the global minimum tax threshold, citing concerns that it might “undermine their ability to entice international companies to their shores and would represent a direct threat to their national sovereignty.”
Since then, Assistant Secretary for Tax Policy Lily Batchelder has stated that Treasury is committed to working with Congress “to protect US tax incentives and promote investment.” She also is quoted by Politico as saying that “some of the incentives cited as being endangered would ‘almost certainly’ fall outside of the scope of the plan because of intricacies in its rules,” without being specific.
While much uncertainty remains around the international agreement, these comments are welcome and indicate there may be room for clarification. ACTION and our partners will continue to urge the Administration to address this issue and work with Congress to protect investments in affordable housing incentivized by the Housing Credit.
HUD Releases FY2022 Income Limits
On April 18, HUD’s Office of Policy Development and Research released Fiscal Year (FY) 2022 income limits, which determine the eligibility of applicants for HUD-assisted housing, including for properties financed by the Housing Credit and Tax-Exempt Housing Bonds for FY22. The new income limits are in effect immediately and must be used by June 2.
HUD develops income limits based on Median Family Income estimates and Fair Market Rent area definitions for each metropolitan area, parts of some metropolitan areas, and each non-metropolitan county. The FY22 national median income is now $90,000, an increase of 12.5 percent over 2021. It is important to note that each year, HUD makes certain adjustments that impact income limits, including capping year over year changes. To learn more about the new income limits, read Novogradac & Company’s recent blog post.
The ACTION Campaign is pleased to welcome the following 17 new members, who joined the coalition this past month:
- City of Flagstaff, Arizona
- Burbank Housing, California
- California Debt Limit Allocation Committee (CDLAC) and California Tax Credit Allocation Committee (CTCAC), California
- Gunnison Valley Regional Housing Authority, Colorado
- Broward County Housing Authority, Florida
- Impact Residential Development, LLC, Georgia
- Iceberg Development, Iowa
- JES Holdings, Missouri
- Sugar Creek Capital, Missouri
- Givens Affordable Communities, North Carolina
- Mecklenburg County Managers Office, North Carolina
- Foundation For Affordable Housing, Inc., Oregon
- AAMCI – Development, LLC, Tennessee
- Lavoro Capital Holdings, LP, Texas
- WellQuest Living, Utah
- Home In Place, Ltd., Washington
- Pioneer Property Management, Wisconsin
Help ACTION continue to grow our membership and advocacy strength by encouraging your networks to support affordable housing and the Housing Credit by joining the coalition. Membership is free.
Together, we can demonstrate to Members of Congress the widespread support for the Housing Credit across the country. You can also help strengthen our reach by following the ACTION Campaign’s LinkedIn page and inviting your connections follow and join us!
Housing Credit Research
- A new report in the Journal of Housing Economics, “Effects of concentrated LIHTC development on surrounding house prices,” finds that: Housing Credit developments have mostly positive spillover effects on surrounding property values; the positive effects of Housing Credit developments remain strong over many years; and the effects are strongest in communities with lower incomes, among other findings.
- An April 20 Notes From Novogradac analysis, “Dispelling Oft-Repeated Misconception, Analysis Shows LIHTC-Financed Properties are Not Concentrating Poverty or Furthering Racial Segregation,” finds that the Housing Credit is not contributing to the segregation of low-income households and that there is more diversity of siting, especially among newly constructed properties.
- A recent article from Harvard’s Joint Center for Housing Studies, “Millions of Renters Fall Short of a Comfortable Standard of Living,” finds that pandemic-related income losses, rising housing costs, and inflation in the cost of basic necessities have put a comfortable standard of living out of reach for many Americans.
- The National Multifamily Housing Council recently released the “NMHC Rent Repayment Tracker Retrospective,” a study which examined 11.8 million apartment households, or about half of all apartment units in the market. The tracker provides concrete data and shows how federal pandemic relief – including emergency rental assistance and stimulus payments –helped renters pay their rent, as well as the varied impacts on rent payment across different geographical areas.
Housing Credit News Highlights
- An April 27 CBS Baltimore article details Governor Larry Hogan’s announcement of more than $200 million in financing tools and new programs to help increase the supply of affordable housing in Maryland. A portion of these funds will go towards additional financing for previously funded 4% Housing Credit and Multifamily Bond projects that are experiencing cost shortfalls as well as projects that previously received a 9% Housing Credit award.
- An April 27 article in Arizona Public Media details the strong demand for Housing Credits across the state of Arizona and the unique challenges in building affordable housing projects in Tucson.
- An April 25 Stateline Article from PEW, “Rising construction costs stall affordable housing projects, drive up market-rate rents” explains how rising building material and labor costs have made financing affordable housing more and more challenging and highlights how the Housing Credit program can be used to alleviate these financial stressors.
- An April 19 article in Rebusiness Online discusses how different states use the Housing Credit in different ways to address their unique affordable housing needs, detailing how the Housing Credit can be used to build affordable housing in low-poverty areas as well as in higher-poverty areas to support revitalization.