NAHMA secures extension on TRACS Notification on Transport Layer Security (TLS) 1.0 Upgrade
This evening, NAHMA was informed that HUD’s Office of the Chief Information Officer (OCIO) agreed to an
extension of the September 3rd deadline for the TLS V1.0 Upgrade. Yesterday, NAHMA shared member’s concerns and is encouraged by HUD’s prompt response. Early next week, HUD will provide an update with the new extension deadline, which NAHMA will share with the broader membership.
Sen. Wyden Re-Introduces Middle Income Housing Tax Credit Act
This week, Sen. Ron Wyden (D-OR) introduced two housing-related bills, the Middle Income Housing Tax Credit Act of 2018 and a bill to provide first-time homebuyers up to a $10,000 refundable tax credit. In 2016, Sen. Wyden introduced similar tax credit legislation during the last Congress, but it never progressed in the Senate. According to the legislation’s
fact sheet, the goals of the middle-income tax credit (MIHTC) are:
- Building on a proven model – the middle-income housing tax credit (MIHTC) is based on LIHTC and establishes a new Section 42 tax credit aimed at developers – and administered by states – to encourage the building of affordable rental housing for middle-income Americans. Similar to LIHTC, states are not obligated to participate in the program.
- How the credit works. Under the MIHTC, the federal government would allocate tax credits to the states based on population. For 2019, the allocation would be $1 per capita with a $1.14 million small state minimum. An additional 5 cents per capita above this allocation would be reserved for middle-income housing developed in rural areas. State housing authorities would then allocate the tax credits to developers through a competitive process. The tax credits would be provided to developers over a 15- year compliance period. The credit amount would equal 50% of the present value of the qualifying costs, or 5% a year on an undiscounted basis. However, state housing authorities would only allocate so much credit as makes a housing project feasible.
- What construction projects would qualify? To qualify for the credit, a rental property would need to meet two affordability standards: 1) a property would have to include a minimum percentage of affordable units; and 2) rents for those units could not exceed maximum amounts based on average incomes in the area. Specifically, at least 60 percent of the property’s units must be occupied by individuals with incomes of 100% or less of Area Median Gross Income (AMGI). Furthermore, tenants’ rents must not exceed 30% of 100% of AMGI. The affordability restrictions would remain in place for up to 15 years after the compliance period. Credits are discontinued to the developer if a project fails to meet these income/rent requirements.
- Safeguarding low-income affordable housing. While geared to incentivizing the construction of affordable housing for middle-income families, the bill also includes protections for low-income affordable housing. A state’s unused MIHTC allocation would get added to the state’s existing LIHTC allocation after one year. If still unused after a second year, the state’s MIHTC allocation would go back to the national LIHTC allocation pool. The bill also contains a Sense of the Senate that Congress pass the Cantwell-Hatch “Affordable Housing Credit Improvement Act”. The Act would increase the annual per capita LIHTC allocation and small state minimum by 50 percent and set a floor under the 4% LIHTC credit, among other provisions.
NAHMA will work with our Federal Affairs and Tax Credit Committees to craft a policy position on the MIHTC and keep members updated. Additional information on MIHTC is available
here.
Rep. Scott Peters Introduces Rent Relief Act
This week, Rep. Scott Peters (D-CA) and four California Co-sponsors introduced the Rent Relief Act of 2018. Similar legislation was recently introduced in the Senate (S.3250) by Sen. Kamala Harris (D-CA). Similar to the Senate’s version, the legislation creates a refundable tax credit for taxpayers who pay more than 30% of their gross income for a year on rent and utilities. The credit percentage would be on a sliding scale from 100% (individuals with gross incomes of less than $25,000) to 0% (individuals making over $100,000). Tenants in government-assisted rental housing, paying over 30% of their income on rent and utilities, could also claim the value of one month’s rent as a refundable tax credit. For additional information, Rep. Peter’s press release on the legislation is available
here.
NAHMA’s Federal Affairs Committee is currently reviewing the Senate’s version of the Rent Relief Act to establish a policy position. We will keep members updated as that vetting process moves forward.
