Legislation includes top Housing Credit priorities to restore 12.5 percent allocation increase and lower 50 Percent bond financing threshold
Today the House Ways and Means Committee marked up and approved bipartisan tax legislation, “The Tax Relief for American Families and Workers Act of 2024” (H.R. 7024), which includes our top two Low-Income Housing Tax Credit (Housing Credit) production priorities—restoring the 12.5 percent allocation increase for 2023–2025, and lowering the 50 percent bond financing threshold to 30 percent for 2024 – 2025.
The legislation was approved with overwhelming bipartisan support on a 40–3 vote, with the three dissenting votes coming from Democrat members of the committee. The approved legislative text can be found here.
If enacted, this legislation would:
- Restore the 12.5 percent allocation increase for 2023 – 2025. This allocation increase was initially enacted in 2018 but expired in 2021. The provision in this agreement would not extend the 12.5 percent retroactively for 2022, but would restore it retroactively for 2023 and keep the provision in place for the next two years.
- Lower the 50 percent bond financing threshold to 30 percent for Private Activity Bond (PAB) allocations made in 2024 – 2025.
Together, the approved provisions are estimated to finance over 200,000 additional affordable homes than otherwise possible, according to Novogradac. Enacting these provisions would also position our priorities for potential extension in 2025, when Congress is expected to enact major tax legislation due to the expiration of most provisions that were included in the Tax Cuts and Jobs Act of 2017 and now this current tax legislation.
“Congress is taking important steps to address our nation’s affordable housing crisis by building on what we know works,” said AHTCC CEO Emily Cadik. “The Low-Income Housing Tax Credit provisions included in the bipartisan tax agreement would finance over 200,000 more affordable homes at a time of skyrocketing need, using a bipartisan tool with a nearly 40-year track record of success.”
“The current tax agreement reflects widespread agreement among Republicans and Democrats that common-sense, public-private partnership solutions are needed to address the nation’s housing crisis,” said Ryan Sfreddo, President of the AHTCC Board of Directors and CEO of Red Stone Equity Partners. “We are thrilled that momentum is building behind measures to strengthen the nation’s most successful and effective tool for addressing the crisis head-on reducing the rental burden being experienced by families and seniors across the country.”
Discussion of Housing Credit Provisions During Legislative Markup
During today’s markup, Affordable Housing Credit Improvement Act (AHCIA) lead sponsor Rep. Darin LaHood (R-IL) highlighted the Housing Credit provisions in the bill, and submitted to the record the industry letter signed by 88 national and state associations. The other House AHCIA lead sponsors Reps. Suzan DelBene (D-WA), Brad Wenstrup (R-OH), Claudia Tenney (R-NY), Don Beyer (D-VA) and Jimmy Panetta (D-CA) all made positive comments about the AHCIA provisions as well, as did Reps. Drew Ferguson (R-GA), Judy Chu (D-CA), Gwen Moore (D-WI), Dan Kildee (D-MI), Bill Pascrell (D-NJ), Brad Schneider (D-IL), and Ways and Means Committee Ranking Member Richard Neal (D-MA).
Several members of the committee introduced and withdrew amendments during markup as a way to highlight their priorities, including several related to housing, but none were adopted.