A new bill seeks to increase low-income housing tax credits (LIHTCs) in the areas devastated by Hurricane Sandy last year.
The legislation calls for declared disaster areas to receive an allocation by the greater of $8 multiplied by the population of the impacted area or 50 percent of the state housing credit ceiling.
It would also provide additional bond allocations in the amount of $9.2 billion each for New Jersey and New York and $3.2 billion for Connecticut.
The Hurricane Sandy Tax Relief Act of 2013 is modeled after a bill that passed in the wake of 2005’s Hurricane Katrina. Among other things, the earlier bill provided additional allocations of housing tax credits, which became known as GO (Gulf Opportunity) Zone credits.
A few years later, several Midwestern states also received housing credits beyond their annual LIHTC authority to rebuild after being damaged by severe storms and flooding.
The new Sandy legislation was introduced by Rep. Bill Pascrell (D-N.J.). When it was unveiled, it had bipartisan support from 28 co-sponsors.
The bill also seeks a special allocation of New Markets Tax Credits, suspension of mortgage revenue bond requirements for residents in the disaster area, and a waiver from the gross income limitation for theft/loss deduction so individuals can deduct the cost of uninsured losses.
"While the Sandy aid we fought so hard for is finally getting to the communities that desperately need it, we know it's not going to be enough to help families and businesses fully recover," said Pascrell, a member of the House Ways and Means Committee. "This legislation will go a long way toward filling this gap by providing immediate tax relief to those impacted by Sandy's devastation. Similar tax relief has been passed following some of our country's worst natural disasters, and Sandy victims deserve nothing less than the same treatment.”