Once again, a bill has been introduced in Congress to amend the Low-Income Housing Tax Credit Program. The “Affordable Housing Credit Improvement Act of 2021” (AHCIA) was introduced in the Senate on April 15, 2021, by Senators Maria Cantwell (D-WA), Todd Young (R-IN), Ron Wyden (D-OR), and Rob Portman (R-OH), and in the House by Representatives Suzan BelBene (D-WA), Jackie Wolorski (R-IN), Don Beyer (D-VA), and Brad Wenstrup (R-OH).
If enacted, the LIHTC program will be strengthened and better able to serve the Nation’s affordable housing needs.
The AHCIA has been introduced in each of the past three congresses, and each time has earned broad bipartisan support. While the full bill has not yet passed Congress, in 2020 a major component of the bill – the establishment of a minimum 4 percent credit rate – was passed into law.
Key provisions have been reintroduced for 2021, including (1) an increase in housing credit allocations by 50% over current levels; (2) additional assistance to rural, Native-American, high-poverty, and high-cost communities, as well as extremely low-income and formerly homeless tenants; and (3) simplification of rules to make preservation of existing affordable housing easier.
Some new provisions have also been added, including (1) states may choose to lower the threshold of Private Activity Bond financing from 50% to 25% in order to obtain a full non-competitive allocation of credits; (2) accelerate the implementation of the allocation increase from the previous five years to two years; (3) improve the housing credit student rule provision to clarify that formerly homeless youth and victims of human trafficking are eligible for affordable housing even if they are full-time students; and (4) update the casualty loss provision from the prior AHCIA to permit a longer rebuilding period after natural disasters, if permitted by the state agency.
While this legislation has been introduced in three consecutive Congresses, the changes in both Congressional and Executive leadership increase the potential for full enactment of the Bill.
We will track the status of the proposed legislation and if there are any changes, we will post an update.