As the year winds down, Affordable Housing Finance surveyed its Editorial Advisory Board about the top news events of 2012. The introduction of S. 1989 to permanently fix the 9 percent low-income housing tax credit (LIHTC) and 4 percent acquisition credit rates as well as the elimination and cuts of soft funding and direct federal funding programs came in at the top of the list.
We also want to hear from you. What do you think the top news event for the affordable housing industry has been in 2012? Or are there events that you think should have ranked on the following list? Please post your feedback in the Comments box at the end of the article.
1. An amendment that would allow for a minimum 9 percent low-income housing tax credit rate through 2013 was added to The Family and Business Tax Cut Certainty Act of 2012, a package of tax extenders. Approved by the Senate Finance Committee on Aug. 2, the amendment was sponsored by Sens. Maria Cantwell (D-Wash.) and Olympia Snowe (R-Maine).
2. The reduction in the Department of Housing and Urban Development’s (HUD’s) HOME program allocation as well as cuts to other federal programs like HUD’s Sec. 202 and Sec. 811 as well as Rural Development’s Sec. 515.
3. The demise of the California redevelopment agencies (RDAs). Approximately 400 RDAs were eliminated in an effort to reduce the state’s budget deficit. The elimination of the RDAs is devastating because these agencies played an enormous role. They were required to set aside at least 20 percent of their revenues to create, rehabilitate, and preserve affordable housing. This generated about $1 billion each year, the largest pool of non-federal money available for affordable homes in the state.
4. President Obama’s re-election and the likely continuation of leadership at HUD. Regardless of the election outcome, affordable housing leaders encouraged bipartisan solutions post-election.
5. The wrath of Hurricane Sandy. At the end of October, the superstorm battered parts of the East Coast. More than 305,000 housing units were damaged or destroyed in New York, while more than 30,000 businesses and homes were destroyed or experienced structural damage and 42,000 homes were impacted in some other way in New Jersey.
6. Forecasted HUD cuts due to potential sequestration. Sequestration would trigger an 8.2 percent cut to a number of HUD programs, according to a report released by the Office of Management and Budget.
7. The retirements of key affordable housing supporters Sen. Snowe and Rep. Barney Frank (D-Mass.).
8. The rollout of HUD’s Rental Assistance Demonstration (RAD) program. RAD was included in the fiscal year 2012 HUD appropriations legislation and provides new project-based rental assistance for certain HUD properties.
9. This past spring, HUD unveiled its FHA LIHTC Pilot Program, which aims to expedite the processing time for FHA-backed deals that use housing tax credits. It began with four hub offices in Boston, Detroit, Chicago, and Los Angeles and then was expanded to five additional offices later in the year to essentially make it a nationwide program.
10. The soft/slow return of the tax-exempt bond/4 percent market. Mid-year, the bond market seemed to be making a comeback, although much of the activity was concentrated in major metro areas.