NCSHA Recommends Improvements to Opportunity Zone Regulations to Increase Affordable Housing Investment
WASHINGTON, DC — Testifying on behalf of the nation’s state Housing Finance Agencies (HFAs) during a public hearing on February 14, Stockton Williams, executive director of the National Council of State Housing Agencies (NCSHA), urged the Internal Revenue Service (IRS) to implement regulations that strengthen the ability of Opportunity Zone tax incentives to expand and preserve affordable housing.
According to recent analysis by NCSHA, the potential for billions of dollars in new investment in affordable housing through Opportunity Zones is growing. Of the 72 funds and $16 billion in planned investment included in the latest edition of NCSHA’s Opportunity Zone Fund Directory, nearly half ―
49 percent (35 funds) ― target community revitalization, including affordable or workforce housing.
In his testimony, Williams highlighted the importance of ensuring Opportunity Zone incentives can be put to work redeveloping vacant land in distressed communities, which represents a huge, largely untapped potential resource for affordable housing in many cities across the United States.
Williams also recommended other opportunities for IRS guidance to further enhance the prospects for affordable housing and economic development in Opportunity Zones including:
- Leveraging Opportunity Zone incentives with other tax credits, including the Low Income Housing Tax Credit, the Historic Rehabilitation Tax Credit, or the New Markets Tax Credit
- Preventing the loss of affordable housing in Opportunity Zones by expressly prohibiting removal or conversion of existing affordable housing, unless new housing of comparable quality and affordability is provided in or near a Zone
- Specifying reporting requirements to enable assessment of the impacts and outcomes of Opportunity Zone investment, including data collection on the number of affordable housing units developed or preserved in each Zone
Williams observed in his testimony, “Most state HFAs were at the table with their governors advising on their Opportunity Zone designation decisions, and many are allocating their own resources to enhance the viability of Opportunity Zones in rural and urban communities in their states. Supporting the utilization of the Opportunity Zone tax incentives to expand and preserve affordable housing is a priority for NCSHA, the state HFAs, and their partners in 2019.”
About the National Council of State Housing Agencies
For more than 50 years, state Housing Finance Agencies (HFAs) have played a central role in the nation’s affordable housing system, delivering financing to make possible the purchase, development, and rehabilitation of affordable homes and rental apartments for low- and middle-income households.
The National Council of State Housing Agencies (NCSHA) is a nonprofit, nonpartisan organization created to advance, through advocacy and education, the efforts of the nation’s state HFAs and their partners to provide affordable housing to those who need it. NCSHA’s vision: An affordably housed nation. Learn more at ncsha.org.