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Affordable Housing Credit Improvement Act: Key Provisions and Impact

Learn about the Affordable Housing Credit Improvement Act (AHCIA), its history, and its key provisions aimed at increasing production, serving hard-to-reach areas and populations, preserving affordable housing, and streamlining and simplifying the housing credit program. Find resources for advocacy and engagement.

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Affordable Housing Credit Improvement Act: Key Provisions and Impact

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  1. Latest on the Low-Income Housing Tax CreditNALFHA Legislative ConferenceEmily CadikAHTCC Executive DirectorSeptember 17, 2019@EmilyCadik @AHTCCoalition

  2. The Affordable Housing Credit Improvement Act History 2015 9 percent Housing Credit rate made permanent 2016 AHCIA first introduced by Sens. Maria Cantwell (D-WA) and Orrin Hatch (R-UT) 2017 AHCIA reintroduced by Sens. Maria Cantwell and Orrin Hatch, first introduced in House by Reps. Pat Tiberi (R-OH) and Richard Neal (D-MA) 2018 12.5 percent Housing Credit allocation increase for four years (2018 – 2021) and income averaging enacted in Consolidated Appropriations Act of 2018

  3. The Affordable Housing Credit Improvement Act AHCIA Reintroduction • Sponsors • S. 1703: Senators Maria Cantwell (D-WA), Todd Young (R-IN), Ron Wyden (D-OR), and Johnny Isakson (R-GA) • H.R. 3077: Representatives Suzan DelBene (D-WA), Kenny Marchant (R-TX), Don Beyer (D-VA), and Jackie Walorski (R-IN)

  4. The Affordable Housing Credit Improvement Act AHCIA Reintroduction • S. 1703 and H.R. 3077 introduced June 2019 • Total Provisions: 27 • 5 new provisions • 4 updated provisions • 2 provisions added to H.R. 3077 only

  5. Key Affordable Housing Credit Improvement Act Provisions

  6. The Affordable Housing Credit Improvement Act Key Provisions: Increasing Production • 50 percent allocation increase phased in over five years (updated provision in S. 1703 and new in H.R. 3077) • Estimated 384,455 additional homes financed • 4 percent minimum Housing Credit rate • At least 66,000 additional homes financed • Expand Multifamily Housing Bond recycling (new provision) • At least 100,000 additional homes financed *Source: Novogradac & Company

  7. The Affordable Housing Credit Improvement Act Talking Point: Potential AHCIA Impact Source: Novogradac & Company

  8. The Affordable Housing Credit Improvement Act Key Provisions: Serving Hard-to-Reach Areas + Populations • Rural areas • Basis boost for developments in rural areas (new provision) • Standardize income eligibility for rural areas • Native American communities: • Basis boost for developments in Native American areas • Native American selection criteria • Veterans of the Armed Forces: • Clarify that veterans are exempt from the general public use rule for Multifamily Housing Bond properties (new provision) • Extremely low-income (ELI) households: • 50 percent basis boost for apartments for ELI tenants

  9. The Affordable Housing Credit Improvement Act Key Provisions: Preserving Affordable Housing • Right of First Refusal (ROFR) (updated provision): • For new properties, replace the existing ROFR with a purchase option • Clarify options for acquiring properties and definition of property • Strengthen protections against planned foreclosures • Capitalize tenant relocation costs • Flexibility around existing tenant income

  10. The Affordable Housing Credit Improvement Act Key Provisions: Streamlining and Simplification • Simplify and better align the Housing Credit’s student housing rule with HUD’s rule (updated provision) • Better align the Housing Credit with the Violence Against Women Act (new provision) • Add income averaging option as a third minimum set-aside option for Multifamily Housing Bond properties (new provision)

  11. The Affordable Housing Credit Improvement Act Summary of Key New Provisions • Provide a 30 percent basis boost for properties in rural areas if needed for financial feasibility • Clarify that veterans are exempt from the general public use rule for Multifamily Housing Bond properties • Better align the Housing Credit with the Violence Against Women Act • Expand Multifamily Housing Bond recycling • Require states to consider cost reasonableness in their Qualified Allocation Plans

  12. The Affordable Housing Credit Improvement Act Potential Legislative Vehicles • Temporary tax provisions • Technical corrections to the Tax Cuts and Jobs Act of 2017 • Spending bill

  13. Advocacy & Engagement Resources • ACTION Resources: www.rentalhousingaction.org • AHCIA one-page overview, summary of all provisions, and explanation of differences between the 115th and 116th Congress versions • National, state, and district fact sheets • Cosponsor lists for S. 1703 and H.R. 3077 • AHTCC Resources: www.taxcreditcoalition.org • Help with groundbreakings and grand openings • Sample letters

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