2019 Affordable Housing Credit Improvement Act Gains Steam with Bipartisan Support

February 3, 2020
Emily K. Bias - Gravel2Gavel Construction & Real Estate Law Blog

As 2019 winds down, the Affordable Housing Credit Improvement Act of 2019 is gaining momentum in Congress. The Act, which is aimed at expanding and strengthening the low-income housing tax credit, was originally introduced in 2016. The Consolidated Appropriations Act of 2018 adopted two key provisions of the original bill—a 12.5% increase to the housing credit ceiling for years 2018-2021 and the “income averaging” minimum set-aside election. The 2019 bill reintroduces many key provisions from the original bill, along with new provisions to further bolster the housing credit. As of the end of October, more than one-third of the House and one-fourth of the Senate have signed on to co-sponsor the bill. In summary, the key proposals in the 2019 legislation would:

  • Establish a minimum 4% credit rate for tax-exempt bond financed transactions;
  • Increase the housing credit volume cap by 50% over five years;
  • Add income averaging as a third minimum set-aside test for 4% bond deals to mirror the modifications to Section 42 of the Internal Revenue Code adopted as part of the 2018 Consolidated Appropriations Act;

Ms. Bias may be contacted at emily.bias@pillsburylaw.com


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