Last Tuesday I woke up in Savannah, Georgia, to speak at the Georgia Affordable Housing Coalition conference. I worked on several potential versions of what we could obtain in the Omnibus, only to find that there was going to be no tax title to the bill at all. No 4% bond fix, no LIHTC cap increase, nothing. As I mentioned in an earlier piece written March 4, we had hopes that a “Grain Glitch” fix for farmer’s co-operatives, an unintended result of last December’s Tax Cuts and Jobs Act, would allow some tax treatment in what is ordinarily an Appropriations bill.
Shortly before we took the stage for a legislative update at 9:15 am, a message came in from our Senate champion Maria Cantwell that the tax portion was alive again. For the next 48 hours, the ACTION Campaign tossed back and forth proposals that were required to match the number or cost of the co-operative fix. Several versions came in via email. There was a 2-year 4% bond fix, a one year bond fix, a 2-year bond fix with a 2-year cap increase, and finally a 4-year cap increase.
Meanwhile, the House and Senate Appropriations Committee work was concluding for additional funding for affordable housing resources across the board. Working closely with Transportation and Housing & Urban Development, Senate Chair Susan Collins (R-ME) and her staff, I knew that they recognized the need for additional resources for housing. While I had no idea of the great results we would shortly see, I had high hopes that the budget deal previously cut would allow for much needed increases in the HUD budget.
Almost a year ago, on April 21, 2017, an unusual but reassuring thing happened in the Senate Committee on Appropriations. Not only did they pass the FY17 funding bill to increase resources to assist households, the vote was 30 to 0. Except for the proposed cut to the Choice Neighborhoods Initiative, the THUD allocation that was voted through unanimously provided approximately $1.4 Billion more in funding than the previous year. I believe the bi-partisan work of THUD subcommittee Chair Senator Susan Collins (R-ME) and Ranking Member Senator Jack Reed (D-RI), in many ways, set the stage for the HUD housing increases in the Omnibus Bill last week.
In the end, Congress passed and President signed the FY 2018 Omnibus Package. In the House, the vote was 256-167 and the Senate passed the measure by a vote of 65-32. The Omnibus enjoyed bipartisan support in both Chambers. How did we do? Congress has allocated $42.7 billion for HUD, which is an increase of $3.9 billion from FY 2017. CDBG will receive $3.3 billion, and HOME Investment Partnerships Program at $1.4 billion. Changes to the Rental Assistance Demonstration Program (RAD) provide a cap increase to 455,000 units for RAD 1 and a new sunset date of September 30, 2024. Also, Section 202 Project Rental Assistance Contract (PRAC) properties are now eligible for RAD 2.
The Low-Income Housing Tax Credit received a 12.5% cap increase per year for 4 years, plus a new permanent provision allowing income averaging which expands eligible households. The hallmark of the Low-Income Housing Tax Credit has always been its longtime support by a list of lawmakers on both sides of the aisle. It appears that we have the same level of cooperation now for affordable housing on all tax and appropriation committees. Let’s use our momentum to go further and finally fix the bond rate at 4%. Now is the time to keep moving forward. Remember there are 7 million families who cannot find an affordable place to live in America.
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