Legislative Update & Current Advocacy Strategy
Congress Returns from Winter Break; Next Big Test: January 30 Funding Deadline
The second session of the 119th Congress began this week with a busy agenda for the year ahead. In November, Congress passed a stopgap funding measure that provided long-term funding for a few government agencies, including the Department of Agriculture and its Rural Housing Service, through the end of federal fiscal year 2026 (FY26) on September 30, and temporary funding through January 30 for the rest of the federal government. If Congress is unable to reach an agreement to fund the remaining government agencies – including Treasury and HUD – there will be a partial government shutdown that will close affected agencies until lawmakers approve funding.
As we head into calendar year 2026, the potential for more tax legislative action remains unknown. House Speaker Mike Johnson (R-LA-04) has repeatedly signaled interest in pursuing additional reconciliation bills this Congress, which could be used to facilitate additional tax policy changes. Senate Majority Leader John Thune (R-SD) has indicated openness to considering additional reconciliation packages, but has not committed to a path forward. More recently, however, House Ways and Means Committee Chairman Jason Smith (R-MO-08) publicly questioned the need for another reconciliation bill, underscoring divisions within Congress on timing and strategy. Separately, some tax-writers continue exploring interest in a bipartisan tax package. The ACTION Campaign continues to work closely with the bill leads of the Affordable Housing Credit Improvement Act (AHCIA) and their staff to identify openings to advance Housing Credit priorities across any viable legislative vehicle.
Congress Could Consider Major Housing Policy Legislation This Year
On December 17, the House Financial Services Committee passed, by a vote of 50-1, a comprehensive bipartisan housing package called the Housing for the 21st Century Act (H.R. 6644). This bill is the House’s response to the ROAD to Housing Act, which the Senate passed late last year as part of the National Defense Authorization Act (though it was ultimately stripped from the final NDAA). Both the Housing for the 21st Century Act and the ROAD to Housing Act would raise the cap on banks’ public welfare investments (PWI) from 15 percent of their capital and surplus to 20, allowing financial institutions to increase their investments in Housing Credit properties and other so-called public welfare projects. ACTION weighed in last fall in support of the PWI cap increase, the standalone legislation for which is titled the Community Investment and Prosperity Act.
The two chambers’ bills have some other overlapping provisions, though they differ in many ways. One difference of note is the inclusion of major enhancements to the HOME Investment Partnerships program in the Housing for the 21st Century Act (the underlying standalone measure included in that legislation is the HOME Reform Act, sponsored by Housing and Insurance Subcommittee Chair Mike Flood (R-NE-01) and Ranking Member Emanuel Cleaver (D-MO-05)). In addition to changes to the HOME program itself, this legislation is notable because it streamlines many of the crosscutting federal requirements that add cost and complexity to HOME, such as environmental and Section 3 requirements, and eliminates the Build America, Buy America requirements as they relate to HOME. The ROAD to Housing Act also includes changes to HOME, but not as far-reaching as those in the House’s bill. Around 15 to 20 percent of Housing Credit properties each year utilize HOME funding, so streamlining HOME and reducing its complexity will significantly benefit many Housing Credit properties.
Should Congress seek to pass housing legislation through regular order, the next step would be for the House to take up the Housing for the 21st Century Act on the floor and then negotiate a compromise with the Senate between it and the ROAD to Housing Act. As of now, it is unclear when the House could consider the bill, though House Majority Leader Steve Scalise (R-LA-01) said in December that the House could vote on it in early 2026.
During the Financial Services markup, Committee Chairman French Hill (R-AR-02), Committee Ranking Member Maxine Waters (D-CA-43), Rep. Warren Davidson (R-OH-08), and Rep. Joyce Beatty (D-OH-03) spoke about raising the PWI cap. Congresswoman Beatty is the lead Democrat on the Community Investment and Prosperity Act. Chairman Hill also noted the expansion of the Housing Credit under OBBBA.
Further, in a December 3 hearing that preceded the markup of the Housing for the 21st Century Act, some members of the committee and witnesses spoke about the importance of the Housing Credit. In their written testimony and in responses to questions from committee members, several witnesses noted the Housing Credit’s significance for financing affordable housing, urged Congress to pass the rest of the AHCIA, thanked Congress for expanding the Housing Credit, and urged Congress to pass the Community Investment and Prosperity Act. Representatives Davidson and Young O. Kim (R-CA-40) spoke to the anticipated impact of raising the PWI cap on increasing housing supply. Congresswoman Kim is a co-lead of the Community Investment and Prosperity Act.
Administration Updates
IRS Reallocates $13.1 Million in Unused Housing Credits to 25 States through the National Pool
On December 18, the IRS published Revenue Procedure 2026-09, which allocates unused Housing Credit carryover authority to qualified states from the National Pool for Calendar Year 2025. The IRS will allocate $13,100,588 in credit authority to 25 states. The list of states and the dollar amount of Credit they will each receive is available in the Revenue Procedure. A blog post by ACTION member Novogradac & Co. reveals that this is the highest carryover amount since 1995. It explains that carryover reallocations usually stem from other states having too few remaining Housing Credits to fund a Housing Credit property, but notes that demand for the program remains strong.
2025 Year in Review
2025 was a breakthrough year for the Housing Credit movement—one for the record books! In a year filled with political headwinds and high-stakes deadlines, ACTION and our partners proved the power of organized advocacy. We elevated the Housing Credit to new national prominence, fortified bipartisan champions, and helped secure the largest expansion of Housing Credit resources since at least 2000 through the signing of the One Big Beautiful Bill Act (OBBBA). The effects of these changes are predicted to be almost 10 times as impactful as the last major expansion of Housing Credit resources, the enactment of a minimum floor for 4 Percent Housing Credits in 2020.
More than milestones, these wins mean more homes, more jobs, stronger communities, and a movement that continues to grow in strength and credibility.
The OBBBA’s permanent 12 percent expansion of the 9 Percent Housing Credit and lowering the 50 Percent Test for the 4 Percent Housing Credit to 25 percent are projected to have the following impact:
- 1.22 million affordable homes nationwide over the next decade
- 1.83 million jobs supported
- $206.6 billion in wages and business income generated
- $71.4 billion in federal, state, and local tax and fee revenue nationwide delivered over the next 10 years.
As we head into 2026, we’re carrying that momentum forward!
Next up: the advocates and congressional champions who made it happen
The Affordable Housing Credit Improvement Act made cosponsorship history in 2025. H.R. 2725 launched with a record-shattering 119 original House cosponsors—nearly double the 2023 record—and closed the year at 163, split evenly by party. In the Senate, S. 1515 also broke records with 30 original cosponsors and finished 2025 with 42, including the strongest GOP showing the bill has ever seen. Across Congress, the AHCIA earned an extraordinary 205 total cosponsors, representing 38 percent of all Members, spanning committee chairs, ranking members, and House and Senate leadership alike.
Even more striking? Entire congressional delegations signed on—seven states’ House delegations, 14 states’ Senate delegations, and one state’s full congressional delegation—and support stretched across the ideological spectrum, from the Freedom Caucus to the Progressive Caucus.
This is people-powered policy. And we’re still growing. Here is the final list of AHCIA cosponsors in 2025.
If your lawmakers aren’t on this list yet, now’s the moment. Call, email, or tag your Senators and Representatives and ask them to cosponsor the AHCIA in 2026. Every new voice moves us closer to more affordable homes nationwide.
Read through some of our biggest achievements highlighted below:
ACTION Hosts First-Ever Congressional Briefing | ACTION’s Hill Event Showcases Housing Credit’s Impacts
- On March 25, the ACTION Campaign hosted a briefing on Capitol Hill for legislative staff and other stakeholders about the impacts and benefits of the Housing Credit. The event previewed the reintroduction of the AHCIA.
- Congressional Housing Credit champions, including AHCIA House lead sponsor Rep. Darin LaHood (R-IL-16), House co-lead Rep. Jimmy Panetta (D-CA-19), and longtime Senate Democratic lead Maria Cantwell (D-WA), shared their support with attendees during the widely attended event.
ACTION’s Advocacy and Education Materials | In 2025, ACTION doubled down on what powers our success: equipping advocates with the tools to win. Over the summer, we released a fully updated In-District Advocacy Guide, packed with field-tested strategies to influence Congress—from hosting Housing Credit site visits, to pitching op-eds and letters to the editor, to driving social media engagement that reaches lawmakers where they are. We also delivered fresh National, State, and District Fact Sheets, ensuring advocates had the latest data and impact projections for every state and congressional district, providing localized proof points to turn conversations into legislative commitments.
Download the advocacy toolkit, share it widely, and use it to help secure new cosponsors and Housing Credit wins in 2026!
Letters on the Housing Credit | ACTION organized letters to Congress in support of the Housing Credit.
- As the AHCIA was being introduced in the 119th Congress, ACTION organized a nationwide sign-on letter to Congress in support of the Housing Credit and AHCIA, urging congressional leadership to include the Housing Credit in the budget reconciliation bill. The letter – signed by over 2,600 national, state, and local organizations and businesses – also urged Members of Congress to cosponsor the bill.
- ACTION once again activated local government leaders in support of the AHCIA and the Housing Credit. In partnership with the National League of Cities, the National Association of Counties, and Mayors & CEOs for U.S. Housing Investment, ACTION collected signatures from 130 local government leaders – mayors, county board chairs, and county executives – on a letter sent to congressional leadership. This letter also urged Congress to enact the AHCIA and include Housing Credit provisions in the budget reconciliation package.
- ACTION’s Steering Committee sent a letter to House Ways and Means Committee Chairman Jason Smith (R-MO-08) thanking him for including an expansion of the Housing Credit in the House-passed reconciliation bill.
- In a rare step, ACTION’s Steering Committee sent a letter to Senate Appropriations Committee leadership urging them to protect funding for the HOME Investment Partnerships Program in FY26 spending legislation, to counter House appropriators’ proposed zeroing out of this program. While ACTION exclusively focuses on the Housing Credit, the Steering Committee felt compelled to send this letter because some 15 to 20 percent of Housing Credit units each year are in properties that use HOME funding, and eliminating funding for HOME would be catastrophic.
- Members of the Steering Committee sent a letter to House Financial Services Committee leadership urging them to include the Community Investment and Prosperity Act in housing legislation under consideration.
Housing Credit Support from the Trump-Vance Administration | In 2025, Housing Credit advocates helped to convince the Trump-Vance Administration to align its housing agenda with ACTION’s priorities.
- On August 5, the Federal Housing Finance Agency (FHFA) announced that it doubled the amount of money that Fannie Mae and Freddie Mac (together, the Government-Sponsored Enterprises, or GSEs) can each invest in the Housing Credit, from $1 billion to $2 billion. This expansion dovetails with the expansion of the Housing Credit via OBBBA.
ACTION Advocacy for Regulatory Updates | ACTION engaged with agency officials to propose potential updates and weigh in on key regulatory changes affecting the Housing Credit program.
- IRS 2025-2026 Priority Guidance Plan. On May 30, ACTION sent a letter to the IRS detailing recommendations for the IRS and Treasury’s 2025-2026 Priority Guidance Plan. The letter called for the IRS to take several actions included in the AHCIA that could be done administratively without legislative change, including facilitating implementation of the Violence Against Women Act protections for Housing Credit tenants, allowing greater flexibility for properties suffering a casualty loss, explicitly including relocation expenses in rehabilitation expenditures, and delegating authority to state agencies to prevent planned foreclosures.
ACTION Member Engagement | The ACTION Campaign held regular meetings for members throughout 2025, including monthly updates via videoconference for ACTION grassroots members. The ACTION Steering Committee continued to meet on an as-needed basis, while its two subcommittees, the Legislative Subcommittee and the Data and Research Subcommittee, met regularly. ACTION also published monthly newsletters for members, which can be viewed on our blog. In total, ACTION sent more than 60 emails keeping members and the Hill informed in 2025, including 14 ACTION Alerts, five letters to Congress, and 18 targeted advocacy emails to members in certain states.
ACTION Membership Growth | ACTION welcomed 96 new members in 2025. ACTION remains the largest coalition of Housing Credit advocates in the United States, with over 2,400 members. Just in December, 13 new members joined ACTION in the movement to expand and improve the Housing Credit:
- Lagniappe Housing Solutions, Oregon
- Arizona Industrial Development Authority, Arizona
- Groundwork Strategies, Virginia
- HRI Community Resources, Inc., Louisiana
- Neighbor 2 Neighbor, Tennessee
- Premier Housing & Development, Minnesota
- Community Development Alliance, Inc., Wisconsin
- Obra Real Estate Services, Illinois
- Renaissance Neighborhood Development Corporation, Louisiana
- Volunteers of America Southeast Louisiana, Louisiana
- Paradigm Program Management Consulting, LLC, Mississippi
- Allie’s Way, Georgia
- Reid Elite Capital, New York
Please help us continue to grow by inviting your affordable housing partners who are not yet members to join ACTION.
We are also updating our membership records, so please help us make sure we have your latest contact information. If you would like to add or change a contact for your organization, please submit it through this form so our list is accurate for 2026. You can also share your social media handles if you’d like ACTION to follow your organization and amplify your Housing Credit content throughout the year.
Thank You & Onward to 2026
To every affordable housing advocate who stood with us in 2025—thank you! Your calls, meetings, letters, data, site visits, and storytelling strengthened a national movement and helped deliver the most meaningful expansion of the Housing Credit in a generation. We’re especially grateful to ACTION’s Steering Committee members, and the Congressional champions who turned advocacy into action and action into law.
As we step into 2026, our message is simple: the momentum is real, the coalition is strong, and the work continues. There are more lawmakers to engage, more communities to lift up, and more low-income families and seniors who need Housing Credit homes—and ACTION is ready to lead the charge with you.
Let’s build on what we proved this year. And let’s deliver even more for families nationwide.
Here’s to another year of bold advocacy, bipartisan leadership, and historic impact. The next win starts now.
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