House Ways and Means Committee Chairman Kevin Brady (R-Texas) proposed on Monday a two-year extenders package that includes the 9% fixed rate for the low-income housing tax credit (LIHTC) for 2015 and 2016.

"While a two-year extension of the 9% fix is less than we were hoping for, it does put us on a good footing as Speaker Ryan and Chairman Brady focus on tax reform in the coming year," says David Gasson, executive director of the Housing Advisory Group (HAG) and vice president of Boston Capital.  
Brady’s proposal also includes:

  • The extension of the New Markets Tax Credit;
  • The extension of the military housing allowance exclusion for determining whether a tenant in certain counties is low income; and
  • The extension of credits for energy-efficient new homes.

Not included in the proposal is the 4% fixed rate for acquisitions, which the Senate Finance Committee has passed twice. According to HAG, if the 4% minimum rate is not included in the House package, Senate negotiators will have a harder time getting it included in the final extenders package. 

“I encourage readers to act now by calling their Senate and House representatives, urging them to include the 4% fix,” says HAG chairman Bob Moss, who also is principal and national director of governmental affairs for CohnReznick. "The timeline is very fluid, and this bill could move as early as this weekend."

Gasson also says the industry is concerned with the larger permanent extenders package being negotiated by the administration and Congress as it currently does not include LIHTC provisions.  "Passage of this package would have put us at a disadvantage going forward as the imperative to pass an extenders package would lessen with so many of the larger provisions off the table," he says. 

A year ago, the Senate passed a tax extenders bill that included an extension of the 9% minimum credit rate for LIHTC allocations. However, it was only for allocations made before Jan. 1, 2015, so the extension’s value was highly limited.

Stay tuned for the latest updates on http://www.housingfinance.com.