NCSHA Washington Report | February 2, 2024
Regrettably, if predictably, press coverage of the House’s passage of the Tax Relief for American Families and Workers Act by a 357–70 vote this week, containing a major expansion of the Housing Credit, downplayed the stunning bipartisan majority vote there and somewhat oversold critical comments by a few Senators to imply the bill is doomed to fail in the upper chamber.
In fact, the early signals suggest the Senate will seriously consider the bill in the coming weeks.
While Senate Minority Leader McConnell (R-KY) has not spoken publicly about it as of this writing, his number two in the Senate Republican leadership, Senator Thune (R-SD), said after the House bill passed: “We need a process that allows for some amendments to try and tweak and fix some of the issues. That could be on the floor and create a floor process that allows for some amendment votes. Or ideally [in the] Senate Finance Committee.”
The top Republican on the committee, Senator Crapo (R-ID), called the original framework for the bill “a thoughtful starting point” and said about the House-passed version yesterday, “I look forward to working with my colleagues to vet the legislation, address concerns, and make the necessary changes to build support.”
The Senate’s top tax writer, Finance Committee Chairman Wyden (D-OR), who spent months developing the framework with his Republican counterpart in the House, Ways and Means Committee Chairman Smith (R-MO), told reporters Wednesday he’s consulting with Senate Republicans as well as his Democratic colleagues on how to move forward.
Some Republican Senators have already indicated their support. Senator Marshall (R-KS) said the Smith–Wyden framework “provides much-needed relief to hardworking families and business owners” and highlighted its expansion of the Housing Credit as “a public-private partnership with a proven track record of success.”
The media can be counted on to play up the most inflammatory remarks, such as Senator Grassley’s (R-IA) — before the House voted — that it’s a bad move for Republicans to support the bill because it “makes the president look good.” Readers may be interested to know the same argument got a hearing on the House floor, where it was unpersuasive to the 78 percent of the Republican caucus who voted in favor.
Yes, it will be hard to get the bill through the Senate, and it will probably take a minute. Even a version that may emerge with relatively minor changes to the House’s legislation — and some Senators are suggesting they may seek major revisions — could complicate or even derail an ultimate agreement on a final package for the president’s signature.
But we’ll hand it to Politico for getting one part of the story right: “Congress is a lot further towards enacting major tax laws in an election year than many observers would have ever expected.”
We’ll be in touch with many of you through other channels about how you can help make that happen.
Stockton Williams | Executive Director
In This Issue
- NCSHA Welcomes New Members
- House Passes Tax Bill with Housing Credit Expansion by Wide, Bipartisan Margin
- Ventura Testifies at Senate Hearing on Housing Affordability
- IRS Provides Guidance on Returned Disaster Housing Credit Authority
- Treasury Posts HAF Program Closeout Guidance, Updated Program Data
- HUD Provides $3.16 Billion to Fight Homelessness
- House Subcommittee Considers Impact of Proposed Bank Capital Standards
- Senate Banking Committee Looks at AI and Housing
- FHFA Publishes Scorecard for Fannie Mae and Freddie Mac
- NCSHA in the News
- Looking Ahead
NCSHA Welcomes New Members
NCSHA welcomed these organizations as Affiliate members in January: Longwell Riess, LLC; Plains Commerce Bank; and ZRG Partners. If you work with a partner interested in becoming a member, please contact Phaedra Stoger.
House Passes Tax Bill with Housing Credit Expansion by Wide, Bipartisan Margin
Wednesday evening, the House of Representatives passed the Tax Relief for American Families and Workers Act of 2024, which includes the restoration of the 12.5 percent increase in Housing Credit authority for 2023, 2024, and 2025 and lowers the bond financing threshold from 50 to 30 percent for 4 percent credit developments that place in service after 2023 as long as the multifamily bond issue financing the property has an issue date before 2026. The vote was 357 – 70, well exceeding the two-thirds majority needed to pass the bill under suspension of the rules. The bill now goes to the Senate. It is still unclear how the Senate will proceed, but this strong showing in the House demonstrates widespread support for the bill. Additional details are available in NCSHA’s blog.
Ventura Testifies at Senate Hearing on Housing Affordability
Rhode Island Housing (RIHousing) Executive Director Carol Ventura testified Wednesday at a Senate Budget Committee hearing on A Blueprint for Prosperity: Expanding Housing Affordability. In her written and oral testimony, Ventura described Rhode Island residents’ significant challenges in obtaining affordable housing for rent or purchase and highlighted RIHousing’s work over its 50 years of operation, during which time the agency has “delivered $8 billion in mortgage financing, assisted 85,000 first-time home buyers, and financed the development or preservation of over 24,000 affordable units.”
Ventura recommended several steps Congress could take to increase the supply of affordable housing and access to affordable housing for vulnerable populations, several of which are also NCSHA priorities: 1) increase appropriations for housing production and preservation programs; 2) increase appropriations for rental assistance and operating support for affordable housing; 3) restore funding for the Section 202 and 811 programs; 4) pass the Affordable Housing Credit Improvement Act; and 5) permanently extend the Federal Financing Bank HUD Risk-Sharing Initiative. A recording of the hearing and the witnesses’ written statements are available here.
IRS Provides Guidance on Returned Disaster Housing Credit Authority
This week, the Internal Revenue Service (IRS) published Revenue Ruling 2024-5 providing guidance on the treatment of returned disaster Housing Credits for the 11 states and Puerto Rico that received disaster credit authority in the Taxpayer Certainty and Disaster Tax Relief Act of 2020. The guidance clarifies that, if a state receives a return of credits after 2022 from an allocation to a development in one of the qualified disaster zones specified in the act, the returned credits will become part of the overall returned credit component of the state’s Housing Credit ceiling in the year of the return, and reallocation of that authority is not restricted to projects located in qualified disaster zones. NCSHA requested this guidance from IRS soon after the act was enacted into law.
Treasury Posts HAF Program Closeout Guidance, Updated Program Data
The U.S. Treasury Department on Thursday released Homeowner Assistance Fund (HAF) closeout guidance and new program activity data for the third quarter of 2023. Treasury says its closeout guidance is intended to ensure recipients completed the award objectives as outlined in their HAF plans, funds were expended on allowable costs, and balances of unobligated and unexpended funds remaining on the HAF award are returned to Treasury. The quarterly data report shows, as of September 30, 2023, HAF recipients had obligated more than $6 billion and spent more than $5.5 billion, assisting more than 458,000 households.
HUD Provides $3.16 Billion to Fight Homelessness
On Monday, the U.S. Department of Housing and Urban Development announced awards totaling $3.16 billion under the Continuum of Care (CoC) program for more than 7,000 projects to provide housing assistance and/or supportive services to people experiencing homelessness, as well as related costs, including a number of awards to state HFAs that administer their states’ Balance of State CoC program. Of the total amount, approximately $136 million was awarded for the Youth Homelessness Demonstration Program, while approximately $57 million was targeted to provide housing and supportive services for survivors of domestic violence and sexual assault. The CoC program provides grants to nonprofit providers, states, tribes, and local governments to address homelessness in their communities. You can learn more about these awards and find a list of individual projects by state here.
House Subcommittee Considers Impact of Proposed Bank Capital Standards
The House Financial Services Subcommittee on Financial Institutions and Monetary Policy held a hearing Wednesday to examine recently issued banking regulations. The bulk of the hearing focused on a July 2023 proposed rule issued jointly by the Federal Reserve, Federal Deposit Insurance Corporation, and Office of the Comptroller of the Currency modifying large bank capital standards. Subcommittee members from both parties raised concerns the rule would deter banks from issuing mortgage loans to low-income and underserved borrowers by unnecessarily increasing the amount of capital banks must hold for higher loan-to-value home loans, a sentiment also expressed by several of the witnesses. NCSHA raised similar concerns in our comments on the proposed rule.
Senate Banking Committee Looks at AI and Housing
On Wednesday, the Senate Banking Subcommittee on Housing, Transportation, and Community Development held a hearing to learn about the positive and negative aspects of using artificial intelligence (AI) in the housing sector. In her opening statement, Subcommittee Chair Tina Smith (D-MN) said she wanted to learn about ways legislation could enhance the uses of AI in housing while protecting the most vulnerable from its threats. Smith expressed concern about how AI is being used in evictions, citing a lawsuit pending in Minnesota against a law firm that automated eviction filings using AI, allegedly without necessary details and sufficient attorney oversight. Witnesses included Lisa Rice, president and CEO of the National Fair Housing Alliance; Dr. Vanessa Perry, interim dean and professor at the George Washington University School of Business and non-resident fellow at the Urban Institute’s Housing Finance Policy Center; and Nicholas Schmidt, partner and artificial intelligence practice leader for BLDS and founder and chief technology officer for SolasAI.
FHFA Publishes Scorecard for Fannie Mae and Freddie Mac
The Federal Housing Finance Agency (FHFA) Tuesday released its 2024 Scorecard for the government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac. The scorecard outlines FHFA’s expectations and priorities for the GSEs for the upcoming year. In 2024, the GSEs will be measured equally on their work to 1) promote equitable access to affordable and sustainable housing and 2) operate in a safe and sound manner. The scorecard lists specific objectives for the GSEs, including exploring opportunities to further sustainable homeownership through measures that support first-time and mission-oriented home buyers, looking at ways to address rising single-family property insurance costs, addressing various multifamily housing needs, and promoting efficiency in the mortgage market.
NCSHA in the News
Scotsman Guide, 2.1.24, Carousel of Promise
Legislative and Regulatory Activities
- February 8 | Comments Due | HUD Notice Changing Methodology, Limiting Annual Increases to Income Limits
- February 12 | Application Deadline | Section 811 Project Rental Assistance for Persons with Disabilities NOFO
- February 15 | Application Deadline | FY24 CDFI Program and NACA Program Application Round
NCSHA, State HFA, and Industry Events
- February 5 | Last Day for Early Registration, Hotel Discounts | NCSHA’s 2024 Legislative Conference
- February 22 – 23 | National Housing and Rehabilitation Association Annual Meeting and Symposium | Palm Beach, FL
Stockton Williams will speak at this event. - March 4 – 6 | NCSHA’s 2024 Legislative Conference | Washington, DC
- March 6 – 8 | National Affordable Housing Management Association’s Winter Conference on Top Issues in Affordable Rental Housing | Washington, DC
Jennifer Schwartz will speak at this event.
