Biden Administration Proposes Additional $28B Investment in Affordable Rental Housing
The Affordable Housing Tax Credit Coalition (AHTCC) has applauded housing provisions recently proposed in the Biden Administration’s FY 2024 federal budget, including a proposal that would strengthen the Low-Income Housing Tax Credit (Housing Credit), the federal government’s primary tool to produce affordable rental
“Through this budget proposal and plans that preceded it, the Administration continues to signal a commitment to the creation of desperately-needed affordable housing,” said AHTCC CEO Emily Cadik. “We remain hopeful that meaningful bipartisan progress can be made to advance policies that address the nation’s housing shortage.”
Housing Credit proposals in the FY 2024 budget call for an investment of an additional $28 billion for the Housing Credit over 10 years and enactment of AHTCC’s top priorities – increasing the annual Housing Credit allocation and lowering the “50 percent test” bond financing threshold to 25 percent. Beyond investment in the Housing Credit, other affordable housing proposals feature prominently in the budget, with a total investment of $51 billion allocated in mandatory funding and other tax incentives to increase affordable housing supply. There are also proposed increases to several Department of Housing and Urban Development programs.
“We are encouraged by the ambitious investments proposed in the President’s budget,” said Cadik. “We look forward to working with the White House and lawmakers in Congress to strengthen a program that has the potential to create millions of affordable homes that would otherwise not break ground.”
The summary of the Housing Credit proposals states:
“Expand the Low-Income Housing Tax Credit (LIHTC): LIHTC is the largest Federal incentive for affordable housing construction and rehabilitation. The Budget invests $28 billion in expanding this tax credit in order to boost the supply of housing that is affordable for low-income renters. Specifically, the Budget permanently increases the allocation of tax credit states receive. It also reduces the private activity bond financing requirement from 50 percent to 25 percent in order to leverage more private capital into LIHTC deals and build more units of affordable housing. And it repeals the qualified contract provision and right of first refusal provision – both of which allowed some owners of LIHTC units to exit requirements to keep rents at affordable levels.”
Founded in 1988, AHTCC is a trade organization of housing professionals who advocate for affordable rental housing financed using the Low-Income Housing Tax Credit (Housing Credit). AHTCC’s for-profit and non-profit members — including syndicators, investors, lenders, developers, legal and accounting professionals and state allocating agencies — seek to preserve, expand and improve the Housing Credit and complementary programs through legislative outreach and education.