Legislative State-of-Play
Tax Package’s Future Remains Murky in the Senate
As previously reported, the House passed the Tax Relief for American Families and Workers Act (H.R. 7024) in late January and sent the bill to the Senate, where it has seemingly hit an impasse. As a reminder, this tax package contains two AHCIA-inspired Housing Credit provisions: temporarily restoring the 12.5 percent cut to the 9 Percent Housing Credit and lowering the bond financing threshold to 30 percent to facilitate increased production using the 4 Percent Housing Credit.
Negotiations between the Senate’s lead tax-writers, Finance Committee Chair Ron Wyden (D-OR) and Ranking Member Mike Crapo (R-ID) have not been successful, and the chance of a breakthrough acceptable to both at this point is unlikely. Minority Leader Mitch McConnell (R-KY) is supporting Crapo.
Moreover, both Minority Whip John Thune (R-SD) and Senator John Cornyn (R-TX), both Finance Committee members vying to take over as Republican leader when McConnell steps down from that position after this Congress, have made clear that they oppose the tax bill. Thune stated that Senate Republicans should vote in unison on the tax package and threatened to filibuster it. Cornyn too has levied criticism of the bill. While some Republicans have publicly supported the tax bill as currently written and/or suggested that they would support the bill with modifications, Republican leadership’s opposition will make it difficult for them to vote in favor if brought to the floor.
What’s Next and How You Can Help
It is still possible that Majority Leader Chuck Schumer (D-NY) could bring the tax bill up for a vote on the floor. On March 20, he took a needed procedural step for bringing the bill as passed by the House to a vote when he placed it on the Senate Calendar. However, this does not mean he necessarily will bring the bill up for a vote, knowing that there is a good chance it won’t have the votes needed to overcome a filibuster. Schumer is also balancing a number of other priorities competing for Senate floor time.
Our best shot at enacting the housing provisions contained in the bill is to convince enough Republicans that it is worth supporting the bill, even if that means they vote for it against the advice of their leadership.
We need ACTION members to keep weighing in with your Senators. Urge them to express their support for H.R. 7024 to Majority Leader Schumer or Minority Leader McConnell. To assist advocates, ACTION created a webpage with links to templates and other materials for your outreach. Be sure also to include the support letter signed by 120 national and state coalitions of affordable housing and community development organizations – including many ACTION members – that was sent to the Senate on February 7. If you have any questions or need help contacting your Senators, please don’t hesitate to email us.
While there is no hard deadline for Senate considering the tax bill, its chances for consideration become less likely as time passes. The Senate returns from its Spring recess on April 8. With tax filing season wrapping up on April 15, the likelihood of Senate consideration of the bill drops after that point, particularly as campaign season heats up.
Biden Signs FY24 Spending Bills
More than five months into Fiscal Year 2024 (FY24) – which started on October 1 – President Biden signed into law two “minibus” bills funding all federal agencies for FY24, the first on March 9 and the second on March 23, providing a total of almost $1.7 trillion in funding for the government.
The first of these minibuses funded both HUD and USDA affordable housing programs. Congress provided approximately $81.4 billion for HUD programs and $28 billion for USDA’s Rural Housing Service (RHS). Housing Credit developments and the tenants in them often rely on HUD or RHS programs for gap financing or rental assistance.
The second minibus, among other things, provides $324 million to the Treasury Department’s CDFI Fund, which provides resources that are also frequently used in conjunction with the Housing Credit.
March AHCIA Cosponsorship Update
The AHCIA currently has over 47 percent of Congress cosponsoring, with supporters evenly divided by Republicans and Democrats. In the House, there were two new cosponsors this past month, bringing the total number of cosponsors there to 220.
- Derrick Van Orden (R-WI-03), March 12
- Chris Pappas (D-NH-01), March 12
In the Senate, there were four new cosponsors this past month, bringing the total number of cosponsors there to 34.
- Roger Wicker (R-MS), March 19
- Mark Kelly (D-AZ), March 19
- Cindy Hyde-Smith (R-MS), March 19
- Alex Padilla (D-CA), March 19
As of this writing, there are also 22 Senators and 25 House Democrats in the queue as we wait for more Republicans to cosponsor so that we can maintain party parity.
AHCIA Advocacy Resources
The ACTION Campaign has a number of advocacy materials to help support your outreach, including National, State, and Congressional District Fact Sheets, our video series detailing the provisions of the AHCIA of 2023, updated statewide ACTION Campaign member lists, an in-district advocacy guide, sample emails for outreach, as well as detailed information about the legislation in our Advocacy Toolkit. We also have a complete list of cosponsors from last Congress, where you can check if your Senators or Representative have cosponsored in the past, as well as the most up-to-date list of current cosponsors.
Other Congressional Updates
Yellen Testifies Before Senate on Biden’s FY25 Budget Request, Underscores Investments in the Housing Credit
On March 21, Treasury Secretary Janet Yellen testified before the Senate Finance Committee on behalf of the Administration regarding the President’s FY25 Budget Request. During the hearing, she conveyed the Administration’s support for affordable housing. Specifically, she noted that the proposal includes an expansion of the Housing Credit and urged the Senate to pass H.R. 7024, especially because it contains Housing Credit provisions. Secretary Yellen again noted that the Housing Credit is the nation’s top tool for financing affordable housing. She also reiterated that the Administration has secured the protection of the Housing Credit under the proposed Pillar II of the Global Minimum Tax during its negotiations with the OECD, as ACTION has covered in the past.
Throughout the hearing, several senators expressed their support for the Housing Credit and urged their colleagues to support H.R. 7024, in particular because of its affordable housing provisions.
Housing Credit Supported During Senate Banking Committee Hearing
During a March 12 Senate Banking, Housing, and Urban Affairs Committee hearing on housing affordability, the Housing Credit and the AHCIA received positive coverage. In particular, Sen. Chris Van Hollen (D-MD) noted the importance of the Housing Credit for the production of affordable homes. Throughout the hearing, one of the witnesses, Matt Josephs of ACTION Steering Committee member LISC, repeatedly urged Congress to pass the AHCIA in its entirety. Senators and witnesses also supported adequate funding for and some commonsense reforms to a number of programs that provide critical gap financing to the Housing Credit.
Housing Credit Supported During House Financial Services Subcommittee Hearing
During a March 20 House Financial Services subcommittee hearing, AHCIA cosponsor Rep. Brittany Pettersen (D-CO-07) touted the success of the Housing Credit and urged her colleagues in the Senate to pass the tax package, explaining that doing so would provide Colorado with over 4,100 additional affordable rental homes during a time when her state is facing an extreme housing crisis.
New Democrat Coalition Endorses AHCIA
On March 20, the House New Democrat Coalition’s Affordable Housing Task Force unveiled its Housing Action Plan, a report detailing the group’s legislative priorities along with Executive Branch regulatory actions it supports related to housing. The plan explicitly endorses the AHCIA and urges Congress to pass it in order to strengthen, protect, and expand the Housing Credit. The report also highlights the Coalition’s previous support of efforts to strengthen the Housing Credit, such as the finalizing of the Average Income Test rule.
Administration Updates
President’s FY25 Budget Request Sent to Congress
On March 11, President Biden sent his FY25 Budget Request to Congress. In addition to proposals to fund other affordable housing programs, the Budget Request aims to expand the Housing Credit in ways largely similar to how the AHCIA would, which would have an initial cost of nearly $37 billion over the next decade (see pages 17, 90, and 145; see starting at page 62 in the “Green Book”). As usual, we look forward to working with the Administration and Congress to get essential Housing Credit investments enacted.
Biden Calls for Housing Investments in State of the Union
During the State of the Union address on March 7, President Biden called for more investments in affordable housing. The President outlined a plan to increase supply, lower costs, and reduce barriers to accessing housing that includes expanding the Housing Credit. According to longtime housing advocates, this year’s State of the Union contained the most housing policy proposals in many years.
IRS Publishes 2024 Population Data for Housing Credit
On March 18, the IRS published Internal Revenue Bulletin 2024-12, containing 2024 population information for the Housing Credit. It reveals that eight states, DC, and all territories that allocate Housing Credits except Puerto Rico will receive the small state minimum for the 9 Percent Credit. Specifically, Alaska, Delaware, Montana, North Dakota, South Dakota, Rhode Island, Vermont, Wyoming, DC, Guam, the US Virgin Islands, and the Northern Mariana Islands will receive $3,360,000 in 9 Percent Credits. The remaining states and Puerto Rico will receive $2.90 per person in 9 Percent Credits. The aforementioned states, DC, and territories will also receive the small state minimum for Private Activity Bonds (PABs) that unlock the 4 Percent Credit, along with Hawaii, Idaho, Kansas, Maine, Mississippi, Nebraska, New Hampshire, New Mexico, and West Virginia. These 17 states, three territories, and DC will each receive the PAB small state minimum of $378,230,000, while the remaining states and Puerto Rico will receive the standard PAB allocation of $125 per person. (There are no Housing Credit properties in American Samoa.)
Regulators Extend Some Deadlines for New CRA Regulations; Judge Halts CRA Implementation
On March 21, federal regulators published an interim final rule delaying the applicability date of two provisions of the new Community Reinvestment Act (CRA) regulations issued in October 2023. Specifically, the facility-based assessment areas and the public file provisions will now go into effect on January 1, 2026, instead of April 1, 2024. The January 1, 2026, date was already an applicability date for other provisions of the new CRA regulations; as such, this change better aligns the new regulations so that more provisions have the same applicability date. The regulators also announced several non-substantive, technical amendments to the new CRA regulations.
However, on March 29, a federal judge in Texas issued a preliminary injunction halting the implementation of the new CRA regulations. Federal regulators are expected to appeal this ruling. ACTION will continue to analyze the rule, monitor developments, and report relevant findings.
FHFA Holds Multifamily Property Insurance Symposium
On March 13, the FHFA held a symposium on multifamily property insurance. As ACTION reported several times last year, there has been a burgeoning property insurance crisis across the country, which is having an outsized impact on affordable housing properties. The crisis is jeopardizing the ability of housing providers to keep properties affordable for low-income households. If the crisis continues to get worse, countless families could lose their housing, likely with no immediate alternative. ACTION is pleased that the FHFA held this symposium to discuss potential strategies and solutions.
HUD Secretary Fudge Resigns
On March 11, HUD Secretary Marcia Fudge announced her resignation, effective March 22. While HUD does not administer the Housing Credit, it administers many key gap financing programs that help enable the continued success of the Housing Credit program, the properties it creates and preserves, and the tenants it serves. Until a new secretary is nominated by the President and confirmed by the Senate, HUD’s current number two official, Deputy Secretary Adrianne Todman, will serve as Acting Secretary.
Treasury Publishes First-Ever Housing Agenda
On March 5, the Treasury Department published its first-ever Housing Agenda, detailing its ongoing and planned efforts to increase the supply of affordable housing. Among other things, the blog post covered Treasury’s support of the Housing Credit, and its upcoming work to allow state and local governments to use federal resources to expand the supply of affordable housing.
ACTION Membership
In March, the ACTION Campaign welcomed three new members to the coalition. Please join us in welcoming the following new members:
- CUBIT Development Group, LLC, Illinois
- WSH Management, California
- CSI Support & Development, Michigan
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 to follow and join us.
Housing Credit Research
- A recent position paper from the American College of Physicians urges Congress and the Administration to adequately fund and streamline regulations of affordable housing programs, including the Housing Credit, as a tool to prevent homelessness and housing instability and improve the mental and physical health of people experiencing homelessness and housing instability.
- A March 7 analysis from ACTION member Novogradac & Co. finds that the President’s FY25 Budget Request could finance up to two million affordable homes.
- On March 14, ACTION Steering Committee member NLIHC released the 2024 edition of its annual report “The Gap: A Shortage of Affordable Homes.” The report finds that extremely low-income (ELI) households – those who earn 30 percent or less than the local area median income or the federal poverty level (whichever is greater) – face a shortage of 7.3 million available and affordable rental homes. In other words, for every 100 ELI renter households, there are just 34 affordable and available rental homes. The report also finds that the shortage of affordable and available homes for ELI renter households skyrocketed by over 480,000 between 2019 and 2022.
- On March 21, the White House Council of Economic Advisers sent the 2024 Economic Report of the President to Congress. It covers efforts by the Administration to increase the supply of affordable housing and provides detailed research and data related to housing policy and trends. The report provides a detailed explanation of the Housing Credit and academic studies demonstrating the positive effects of the Housing Credit. The report also calls for Congress to strengthen, protect, and expand the Housing Credit in line with the President’s FY25 Budget Request.
- A March 26 blog post by SPUR notes that the Housing Credit is a key source of financing for seismic retrofits to protect apartments from earthquake damage.
- A March 27 report from the Bipartisan Policy Center explores the impacts of the affordable housing shortage on jobs, workers, and the economy, and among other things, urges Congress to pass the AHCIA and H.R. 7024 to help solve the problem.
- A March 28 analysis by Novogradac compares and contrasts the national and state-by-state impacts of the proposals to expand the Housing Credit via the AHCIA and President Biden’s FY25 Budget Request, among other things.
- An April 1 article in the Novogradac Journal of Tax Credits explores the rise in the use of PABs for affordable multifamily rental housing over the past two dozen years. It recommends that the Senate pass H.R. 7024 and that Congress pass the AHCIA.
Housing Credit in the News
- A February 29 article in REBusiness details the strength and resilience of the Housing Credit program and demonstrates the need for its expansion.
- Identical March 1 and March 7 op-eds in the Chicago Sun-Times and the Rochelle News-Leader by AHCIA House lead Rep. Darin LaHood (R-IL-16) urge the Senate to pass the tax package, including because of its AHCIA-inspired provisions.
- A March 5 article in Bisnow notes that the Housing Credit provisions in the tax package stand to be the most significant investment in the program in decades.
- March 7 articles in the Washington Post, the Sacramento Observer, and Housing Wire cover President Biden’s housing proposals from the State of the Union, including his planned expansion of the Housing Credit.
- A March 8 Reuters article covers an interview with Treasury Secretary Yellen, who noted that the President’s proposed housing policies, including expanding the Housing Credit, will help boost the supply of affordable housing.
- A March 8 article in the Idaho Statesman covers the affordable housing crisis in Caldwell, ID, and notes that the Housing Credit has been and can continue to be an effective tool to address the shortage, especially if properties utilize the Average Income Test.
- During a March 12 event at the Urban Institute, White House National Economic Adviser Lael Brainard discussed recent and ongoing efforts by the Biden-Harris Administration to lower housing costs and increase the supply of housing. Specifically, Dr. Brainard covered the Administration’s proposal to strengthen and expand the Housing Credit and urged the Senate to pass H.R. 7024.
- A March 12 blog post by the United Church of Christ notes that the UCC General Synod urges its parishioners to encourage Congress to pass the AHCIA in order to address the housing crisis.
- A March 13 article in the Missoula Current covers the Senate Banking Committee hearing and details how the AHCIA could help mitigate the affordable housing crisis in Montana.
- A March 19 op-ed in Bloomberg argues that Congress and the Administration should reinvigorate the Housing Credit by passing the AHCIA, which would be a necessary step to complement President Biden’s proposed mortgage relief tax credit for homeowners.
- A March 20 article in Newsweek covers President Biden’s housing policy proposals, including to expand the Housing Credit.
- A March 21 op-ed in Crain’s New York by AHCIA cosponsor Rep. Dan Goldman (D-NY-10) touts the Housing Credit provisions in the tax package and urges the Senate to pass it.
- A March 26 op-ed in The Hill by Rep. Norma Torres (D-CA-35) promotes the aforementioned New Dems’ Housing Action Plan and the group’s work to pass the tax package that includes an expansion of the Housing Credit.
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