A bipartisan bill to expand the low-income housing tax credit (LIHTC) by 50% has been introduced by Sens. Maria Cantwell (D-Wash.) and Orrin Hatch (R-Utah) today.

Sen. Maria Cantwell

Under the proposal, the expanded LIHTC program would help create or preserve approximately 1.3 million affordable homes over a 10-year period—an increase of 400,000 more units than is possible under the current program. The expansion would be phased in by 10% per year for the next five years.

“Affordable housing is a crisis all across America,” Cantwell said in a statement. “With skyrocketing rents and an increase in homelessness, more affordable housing units are a necessity. That is why today, Sen. Hatch and I are introducing legislation to expand the LIHTC. By building more affordable housing units across the United States, more people can have a shot at the American Dream.”

Hatch is chairman of the Senate Finance Committee, and Cantwell is a committee member. The bill is co-sponsored by Sens. Ron Wyden (D-Ore.), ranking member of the Finance Committee, and Charles Schumer (D-N.Y.).

See how a 50% increase would affect your state.

The Affordable Housing Credit Improvement Act also seeks to create a new income-averaging option to help developments maintain financial feasibility while providing a deeper level of affordability.

The bill also enacts a permanent 4% credit rate floor for acquisition and bond-financed projects. Similar to the minimum 9% credit rate that was made permanent at the end of last year, this change would streamline program administration, increase predictability, and empower states to allocate more credit equity to properties as needed for financial feasibility, say supporters.

“Building on the success affordable housing and specifically the LIHTC has had, we are extremely excited about this proposal introduced by Sen. Cantwell, Chairman Hatch, Sen. Schumer, and Sen. Wyden,” said David Gasson, executive director of the Housing Advisory Group and vice president at Boston Capital. “It is hard to remember a time when the country has faced a more dire need for affordable housing resources so this legislation is both timely and necessary. The fact that it has garnered the support of the Finance Committee chairman and ranking member is a testament to the importance of the legislation and the incredible work of Sen. Cantwell in spearheading this effort.”

Others also cited the need for a LIHTC expansion.

“With rents at historic highs, rental vacancies near historic lows, and more than one in four renters spending 50% or more of their income on rent, the bill comes at a critical time,” said Terri Ludwig, president and CEO of Enterprise Community Partners, one of the lead organizations of the A.C.T.I.O.N. Campaign, which has been calling for a housing credit expansion.

Officials at the National Council of State Housing Agencies (NCSHA) called the LIHTC essential to addressing the nation’s housing affordability crisis.

“The housing credit is the most important and effective rental housing production tool states have, but the authority available to it is not nearly enough to respond to rapidly escalating affordable rental housing need and increasing demands on the program,” said Barbara Thompson, NCSHA executive director.

Housing advocates said the bill likely won’t be taken up on its own. It will need to be part of other legislation to move through Congress. A 50% increase in housing credits is estimated to cost about $4 billion over 10 years, so the change comes with some considerable expense. However, supporters reported seeing more enthusiasm for the change.

Cantwell has been campaigning to expand and reform the LIHTC program even before introducing the bill. She announced her plans in Seattle in March and has held events in several other cities.