It is expected that the Senate will vote on its version of tax reform after Thanksgiving. The version to be voted on will include several changes to the Low-Income Housing Tax Credit (LIHTC) program and, unlike the House bill, retains private activity bonds (i.e., the Tax-Exempt Bond Program). None of the proposed changes to the LIHTC program will increase the cost of the plan. Those changes are as follows:
- Clarify that state Housing Credit Agencies have the authority to determine what constitutes community revitalization, within broad parameters, for purposes of determining whether properties are eligible for a basis boost due to being located in a Qualified Census Tract and contributing to a “concerted community revitalization plan;”
- Prohibit local approval and contribution requirements in order to prevent local opposition (“NIMBY”) from preventing housing credit developments;
- Require that states add a selection criteria to their Qualified Allocation Plans (QAPs) for housing that serves the needs of Native Americans; and
- Rename the program the “Affordable Housing Tax Credit.”
Many other changes that were included in the Cantwell-Hatch Affordable Housing Credit Improvement Act, which was introduced earlier this year, cost money. Due to severe budgetary pressures on the tax plan, none of those proposed changes are included in the current bill.
As noted, a vote on the Senate bill is expected in the week after Thanksgiving. This will be followed by a House/Senate Conference Committee, which must agree on a single bill to present for the President’s signature. The stated goal is to have this done before Christmas.