Senate Fails to Advance Tax Bill Containing LIHTC Provisions
Last week, the Senate vote on the Tax Relief for American Families and Workers Act failed to pass, falling short of the 60-vote filibuster threshold by a 48-44 margin. Notably, the vote did not strictly follow party lines, with Republican Senators Josh Hawley (R-MO), Markwayne Mullin (R-OK), and Rick Scott (R-FL) supporting the bill, contrary to their party’s leadership. In contrast, Senators Bernie Sanders (I-VT) and Joe Manchin (I-WV) voted against it. This outcome brings an end to a six-month impasse over the legislation, which had previously passed the House with substantial bipartisan support but faced immediate opposition from Senate Republican leaders, due to disagreements over the Child Tax Credit provisions. Please understand that the opposition to this bill did not focus on the Low-Income Housing Tax Credit (LIHTC) provisions included in the bill.
Despite this setback, there remains interest among some Senators in advancing components of the tax bill. Discussions are ongoing about potentially considering individual parts of the bill after the November elections. NAHMA will continue to advocate for the LIHTC provisions. These provisions aim to restore the 12.5% LIHTC allocation increase that expired at the end of 2021; and reduce the private activity bond threshold requirement from 50% to 30% to access four percent Housing Credits. Implementing these provisions could finance the development or preservation of over 200,000 additional affordable rental homes, addressing a critical need amid the ongoing affordable housing crisis.
NAHMA acknowledges the efforts of our members in advocating for the inclusion of the LIHTC provisions in the Tax Relief for American Families and Workers Act. NAHMA will need your continued engagement to ensure these provisions advance in any forthcoming tax legislation this year and to position LIHTC on a strong footing for potential 2025 tax legislation.
Nevada Senator Rosen Introduces Legislation to Address Housing Construction Workforce Shortage
Last week, U.S. Sen. Jacky Rosen (D-NV) has introduced the Creating Opportunities for New Skills Training at Rural and Underserved Colleges and Trade Schools (CONSTRUCTS) Act (S. 4980), aimed at increasing the housing supply by addressing the shortage of skilled residential construction workers. Nevada, which is currently facing one of the worst affordable housing shortages in the nation, sees a lack of residential construction workers as a major contributor to the crisis. The CONSTRUCTS Act proposes a new competitive grant program through the Department of Labor to fund residential housing construction education and skills training programs at community colleges and career and technical education schools.
In a press release, Sen. Rosen highlighted the severity of Nevada’s housing crisis and the need for immediate action to lower housing costs. “By increasing the housing supply, we can help meet demand and lower costs for hardworking Nevada families,” she said, emphasizing the importance of skills training for good-paying jobs that do not require a four-year college degree.
The legislation has garnered significant support from various stakeholders. Carl Harris, Chairman of the National Association of Home Builders, praised the bill, noting the industry’s ongoing labor shortage of approximately 400,000 workers and the resulting construction delays and increased housing costs. Maurice Page, Executive Director of the Nevada Housing Coalition, expressed the coalition’s support, stating that the initiative aligns with their mission to enhance affordable housing through workforce development.
Additionally, Senator Rosen is working to lower housing costs through the Housing Oversight and Mitigating Exploitation (HOME) Act, which aims to curb price gouging by corporate investors who drive up home prices by buying housing stock. She has also urged HUD to increase the Southern Nevada Regional Housing Authority’s Housing Choice Vouchers allocation by 10,000 vouchers over five years.
The CONSTRUCTS Act represents a comprehensive effort to address the critical shortage of skilled construction workers and alleviate the affordable housing crisis in Nevada and beyond. By fostering workforce development through targeted education and training programs, the legislation aims to build more homes, meet housing demand, and ultimately lower costs for families.
Senators Introduce Bipartisan Legislation to Boost Rural Affordable Housing Investments
Last Week, U.S. Senators Jerry Moran (R-Kan.), Mark Warner (D-Va.), and Todd Young (R-Ind.) along with U.S. Representatives Darin LaHood (IL-16) and Dan Kildee (MI-08) introduced new legislation to amend the Internal Revenue Code, ensuring that Government Sponsored Enterprises (GSEs) Fannie Mae and Freddie Mac can participate in partnerships critical for low-income housing investments.
In 2023, Senators Moran and Warner, with the support of 20 colleagues, urged Treasury Secretary Janet Yellen to provide clear guidance confirming that Fannie Mae and Freddie Mac are not Tax-Exempt Controlled Entities (TECEs). The current tax code stipulates that investors partnering with TECEs are not entitled to certain benefits, such as accelerated depreciation, historic rehab tax credits, or energy credits that support affordable housing. The new legislation aims to clarify that Fannie Mae and Freddie Mac are not subject to these limitations, thereby protecting their role in crucial housing partnerships.
In the press release for this legislation, Senator Moran highlighted the severe impact of housing affordability issues on rural Americans, stressing the need for this technical change to boost investment in affordable housing credits. Senator Warner emphasized the importance of an all-hands-on-deck approach to address the affordable housing crisis affecting both rural and urban communities in Virginia. Senator Young underscored that increasing housing units is essential to tackling the housing crisis, and this bill would facilitate necessary partnerships for rural low-income housing investments.
Representative LaHood pointed out that affordable housing is vital for families in rural Illinois, and strengthening investment tools is crucial for expanding housing options. Representative Kildee echoed this sentiment, noting that clarifying outdated tax rules will protect and expand affordable housing opportunities in Michigan’s rural communities.
NAHMA will continue supports the goal of this legislation to boost the supply of affordable housing in rural areas.