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Senator Orrin Hatch, the longest-serving Republican senator, recently announced that he will not seek reelection in November. Last year, Senator Hatch and Senator Maria Cantwell of Washington re-introduced the bipartisan Affordable Housing Tax Credit Improvement Act of 2017. The bill amends the Internal Revenue Code, with respect to the low-income housing credit, to rename the credit "the affordable housing credit" and make several modifications to the credit.
The California Public Utilities Commission (CPUC) recently approved the creation of the Solar on Multifamily Affordable Housing (SOMAH) program. Funded by the statewide greenhouse gas cap-and-trade program, it will provide $100 million in annual solar installation incentives for the owners of affordable multifamily buildings.
An article by Jeff Larrimore and Jenny Schuetz recently published by the Federal Reserve, Assessing the Severity of Rent Burden on Low-Income Families, found that housing costs are a severe financial burden to many low-income families and that households that have little income left after paying rent may not be able to afford other necessities, such as food, clothes, health care, and transportation.
The House recently approved a motion to go to conference to reconcile differences between the House and Senate versions of the Tax Cuts and Jobs Act and announced the members who will serve on the House conference committee. At this time, the Senate has not yet voted to go to conference, but it is expected to take this step soon.
Here is an overview of the House and Senate tax reform bills impacting the LIHTC industry and affordable housing:
A recent blog post by Kermit Baker and Alexander Hermann of the Joint Center for Housing Studies of Harvard University looked at losses from natural disasters over the last 12 years. They found that the total cost of the natural disasters that occurred in 2017, including Hurricanes Harvey, Irma, and Maria, could exceed disaster-related damages from any year in the last two decades.
An amendment to the Senate tax bill added by Senator Pat Roberts, the Republican senior senator from Kansas, would strike artists’ housing from the list of qualified groups who can benefit from federally subsidized low-income housing. It would forbid developers from LIHTCS to build affordable housing with a preference for artists.
A group of lawmakers from Washington state recently introduced legislation to increase the LIHTC by 50 percent, which could result in as many as 400,000 more affordable housing units over 10 years. Congresswoman Suzan DelBene introduced the bill along with cosponsors Reps. Adam Smith and Pramila Jayapal. All of them represent King County, where housing demand and costs have skyrocketed in recent years. In Washington state, nearly 400,000 households pay half their income in rent.
According to a recent report from Freddie Mac, the number of available affordable multifamily units has fallen alarmingly over the last six years. A combination of rising rents and stagnant household income is exacerbating the problem, and it could get worse yet if action isn’t taken to increase the supply of affordable rental units to keep up with growing demand, according to research released by Freddie Mac Multifamily.
U.S. Senator Tim Kaine recently announced that he is joining his colleagues Senator Maria Cantwell (D-WA) and Senate Finance Committee Chairman Orrin Hatch (R-UT) to co-sponsor the Affordable Housing Credit Improvement Act of 2017, a bill that would boost affordable housing options for low-income families in Virginia.
The IRS recently announced that it has provided temporary relief from certain requirements of the Internal Revenue Code to allow owners and operators of LIHTC sites located anywhere in the United States and its possessions to provide temporary emergency housing to individuals who are displaced by a major disaster from their principal residences, regardless of income. In addition to normally applicable LIHTC income limits, the IRS has authorized owners and operators to disregard transience rules, or requirements for a minimum length of occupancy.
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