Legislative State-of-Play
All Eyes on Housing Affordability, From the Administration to Congress
On September 1, Treasury Secretary Scott Bessent announced that the Trump Administration is considering declaring a national housing emergency, which could allow the administration to take actions that would help ease the crisis by facilitating increased housing production. Among the measures under review are tariff exclusions on key building materials such as lumber, steel, copper, and aluminum, aimed at reducing construction costs. Other potential actions include streamlining permitting processes, standardizing building and zoning codes, and lowering closing costs for homebuyers. Such actions would address housing affordability, augmenting the recent expansion of the Housing Credit—the nation’s most effective tool for increasing the affordable rental housing supply. Together, these efforts reflect a multi-pronged federal approach to lowering costs and accelerating development. ACTION will continue to work with the Administration and Congress to provide guidance on the Housing Credit and possibilities to further leverage the investment.
Senate Banking Committee Unanimously Passes Housing Package
On July 29, the Senate Banking, Housing, and Urban Affairs Committee unanimously advanced the Renewing Opportunity in the American Dream (ROAD) to Housing Act (S. 2651), a comprehensive bipartisan housing package that includes several provisions affecting the Housing Credit and related programs. The bill passed by a 24-0 vote, reflecting the broad support among lawmakers for addressing the nation’s housing crisis. As noted in our August newsletter, one key component of the package is the is the Community Investment and Prosperity Act, introduced by Banking Chairman Tim Scott (R-SC) and Sen. Lisa Blunt Rochester (D-DE), which would raise the cap on bank investments in public welfare activities—from 15% to 20% of assets. This provision would help unlock additional capital for Housing Credit investments at a time when many banks have already hit their current cap.
The full Senate could consider the ROAD to Housing Act later this fall, likely in October or November due to the chamber’s packed legislative calendar. The bill’s unanimous bipartisan committee approval should help pave the way for passage when it does come to the floor. Assuming the bill eventually passes the Senate, it will go to the House for consideration, where it is certain that the lower chamber’s leadership will also want to make their own mark.
Chairman Scott also filed the package as an amendment to the annual defense authorization bill. The ROAD to Housing Act’s unanimous committee vote could also bode well for its passage as an amendment to the defense bill. However, it is not uncommon for congressional leadership to strip any amendments not related to national security from the defense bill before a vote is even held. Congress has successfully passed the defense bill every year for over 60 years.
Rumors Continue Around Additional Tax Legislation
There is increasing speculation around interest in a second, and potentially even a third, budget reconciliation bill before the end of the current Congress—particularly among House Republicans. The Republican Study Committee, a key bloc within the House majority, has already convened a working group to examine prospects. In the Senate, support is less certain: while Majority Leader John Thune (R-SD) has not completely ruled it out, Finance Committee Chairman Mike Crapo (R-ID) has noted that many tax proposals were left on the cutting room floor earlier this year and remain of interest.
There is also continued chatter about a bipartisan year-end tax package with a number of tax proposals already mentioned publicly that could be included in such a package.
While nothing in Congress is ever truly off the table, Washington insiders are not very optimistic. The aftermath of the budget reconciliation process often leaves behind unusually sharp partisan divisions, even beyond what is typically reported in the media. That said, ACTION continues to prepare and strategize with our bill leads and their staff to identify opportunities to advance Housing Credit legislation, including the provisions from the Affordable Housing Credit Improvement Act (AHCIA) that have not yet been enacted. To support your advocacy, ACTION has just updated its national, state, and district fact sheets!
AHCIA Cosponsorship
Are we still building cosponsorship after the tax reconciliation bill was enacted with AHCIA provisions? YES! And we need your help to leverage the momentum from the reconciliation votes to keep adding Republicans to the bill. This is important should there be additional opportunities to advance another tax package in the remainder of this Congress and to build an even stronger foundation of support for the next Congress. The AHCIA currently has over 37 percent of Congress cosponsoring, with support evenly divided by Republicans and Democrats.
Administration Updates
FHFA Increases Housing Credit Investment Caps for GSEs
On August 5, the Federal Housing Finance Agency (FHFA) announced that it is increasing the Housing Credit investment caps for Fannie Mae and Freddie Mac (collectively known as the Government-Sponsored Enterprises, or GSEs) to $2 billion each, for a total of $4 billion per year, up from $1 billion each per year previously. FHFA stated that half of the $4 billion will be invested in difficult-to-serve Housing Credit markets, and that at least 20% of that half (that is, at least 10% of the total) must be invested in Duty to Serve Rural Communities.
ACTION Membership
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
- An August 4 blog post by the Urban Institute calls on policymakers to expand the Housing Credit to help reduce child homelessness. The blog notes that the Housing Credit is effective for creating and preserving affordable housing, which is proven to reduce homelessness. The blog explains that homelessness among pre-K through 12th grade students has skyrocketed 80% in the past 17 years, to 1.2 million youth. Student homelessness has a wide variety of negative impacts, including poor mental and physical health, poor academic performance, and more.
- An August 11 blog post by Harvard’s Joint Center for Housing Studies covers the increasing numbers of cost-burdened older households and calls on Congress to further expand the Housing Credit to help address this trend and make housing more affordable for older Americans.
Housing Credit in the News
- An article in CNBC covers the expansion of the Housing Credit in OBBBA.
- An article in Affordable Housing Finance explores the lowering of the 50% test in OBBBA.
- An August 5 article in the Scotsman Guide covers FHFA’s increase of the Housing Credit investment caps for the GSEs.
- An August 5 article in the ABA Banking Journal covers FHFA’s increase of the Housing Credit investment caps for the GSEs.
- An August 7 article in RisMedia covers FHFA’s increase of the Housing Credit investment caps for the GSEs.
- An August 8 article in KPCW explores the Housing Credit’s expansion in OBBBA and how it will benefit Utah.
- An August 10 article in Bisnow explores the expansion of the Housing Credit in OBBBA and FHFA’s decision to double the Housing Credit investment caps of the GSEs.
- An August 12 article in CalMatters explores the Housing Credit’s expansion in OBBBA and how it will benefit California.
- An August 15 article in the Santa Monica Lookout covers the Housing Credit expansion in OBBBA and FHFA’s increase of the Housing Credit investment caps for the GSEs. It features an interview with the Community Corp. of Santa Monica, an ACTION member.
- An August 19 article in the Idaho Capital Sun covers a recent housing roundtable in Idaho hosted by Sen. Mike Crapo and HUD Sec. Scott Turner. During the roundtable, Chairman Crapo noted that housing costs are one of the main – if not the single biggest – issues his constituents talk to him about, and he touted the expansion of the Housing Credit in OBBBA.
