The affordable housing industry is celebrating a significant victory in our never-ending pursuit of additional resources to address the nation’s growing affordable housing crisis. With the passage of the fiscal year 2018 omnibus budget, Congress has restored some of the resources to the low-income housing tax credit (LIHTC) that had been diminished with the passage of the Jobs and Tax Cuts Act of 2017 in December.
Inclusion of a 50% cap increase to the 9% LIHTC over four years (2018-2021) and the permanent initiation of the income-averaging provision will provide much-needed financial and housing resources to communities across the country. In addition, appropriators recognized the damage inflicted on the Department of Housing and Urban Development (HUD) budget, and thus those Americans that rely on HUD’s assistance, by repeatedly reducing resources to much-needed programs as recently noted in reports by both the Joint Center for Housing Studies at Harvard University and the National Low Income Housing Coalition. Acting on this information, as well as countless meetings with housing advocates, the appropriators increased the fiscal 2018 HUD budget by 10% over fiscal 2017 numbers. Credit for this abounds but special mention must go to Sen. Susan Collins (R-Maine), chair of the Appropriations THUD (Transportation, Housing and Urban Development and Related Agencies) subcommittee, for her steadfast support for affordable housing. More on the ongoing budget battle at a later date.
What we would like to touch on now is the narrative that arose out of the omnibus agreement that inclusion of the LIHTC provisions was a Democrat-only priority. For a number of years now, the affordable housing industry that advocates specifically for the LIHTC, including the over 2,000 members of the Affordable Rental Housing Action Campaign, have focused on and taken pride in the bipartisan support we have garnered for the program. In the current Congress, H.R. 1661, the Affordable Housing Credit Improvement Act of 2017, has 141 cosponsors, 69 of which are Republican. Of those 69 Republicans, 16 serve on the House Ways and Means Committee, which has jurisdiction over tax policy and thus the LIHTC.
In the course of the debate over the tax provisions that would make up the tax title of the omnibus bill, the industry mobilized these supporters in Congress and asked them to let Speaker Paul Ryan (R-Wis.) and Ways and Means Chairman Kevin Brady (R-Texas) know that they supported including the LIHTC provisions from H.R. 1661 in the final bill. Legislative advocacy is a game of education, communication, and trust, and while nothing is guaranteed until the final bill is voted on and signed into law, we were confident from the communications our advocates around the country were getting back from their elected representatives that the speaker and chairman were getting the message loud and clear. The LIHTC was and is a House Republican priority.
Negotiations continued and our LIHTC champion, Sen. Maria Cantwell (D-Wash.) kept us informed as Senate Majority Leader Mitch McConnell (R-Ky.), Democratic Leader Chuck Schumer (D-N.Y.) and Finance Committee Chairman Orrin Hatch (R-Utah) held the line with the House on the LIHTC. At one point it appeared the entire tax package was dead, but through the sheer determination of Republicans in the House, it was brought back to life and negotiations started anew. In the end, our Republican and Democratic supporters prevailed, and the LIHTC provisions were included.
The assertion, after the fact, that inclusion of the LIHTC provisions was a “giveaway” to Democrats is both misleading and inaccurate. Including the Path Act of 2015, which provided for the permanent 9% fixed rate, this is the second time a Republican House has voted to strengthen the LIHTC. Let the talking heads say what they will, but the facts show that for over 32 years now, the low-income housing tax credit has been the poster-child for bipartisan support. As we press ahead in our quest to secure the remaining provisions of S. 548 and H.R. 1661, it will be bipartisan support that lead to our success.
Bob Moss, principal and national director of governmental affairs at CohnReznick, is chairman of the Housing Advisory Group.
David Gasson, vice president at Boston Capital, is executive director of the Housing Advisory Group.