NCSHA Washington Report | January 26, 2024

Members of the U.S. House of Representatives:

Your opportunity to vote, potentially next week, for or against the Tax Relief for American Families and Workers Act is — and is not — about a few different things.

A vote for the bill is a vote to make possible more than 200,000 additional affordable homes across the country over the next two years, through the bill’s inclusion of key provisions of the bipartisan Affordable Housing Credit Improvement Act. Every state will benefit.

A vote in favor is not the last opportunity to advance, in other legislation later, other important parts of the AHCIA, including improvements NCSHA has long advocated to enable more credit-financed properties to serve more of the lowest-income people and reach more underserved rural communities.

A vote against the bill is an epic fail to seize the most opportune moment to secure significant additional tax incentives for affordable housing for the foreseeable future. The next tax bill that could carry them won’t begin to be developed until 2025, and it will be extraordinarily complicated and contentious “with trillions of dollars of tax increases at stake.”

A vote of no is not a viable move to try to modify the legislation more to one’s liking. The bill is expected to move under special House rules that limit debate, prevent amendments, and require a two-thirds majority to pass; it’s this bill or no bill.

A vote for the bill is proof that, even amidst historic polarization and crippling dysfunction, Congress can still develop and pass important laws as it should but too rarely does: through bipartisan co-sponsorship, bi-cameral coordination, substantive hearings, and orderly committee consideration.

A vote of yes is not a guarantee of passage in the Senate — but an overwhelming bipartisan vote on the House floor, matching the extraordinary 40 – 3 passage in committee (with ayes from members of House caucuses spanning Freedom to Progressive), can generate momentum to convert key Senators’ constructive comments into similar Senate legislative action.

A vote against the bill, in our view, puts either ideological purity or political cynicism before well-documented needs of the American people.

A vote against does not, no matter what the more cynical or ideological among us may suggest, deprive either party of hot button tax policy ideas to attack each other over in this year’s election cycle. So, cheer up and pass it.

One more thing: A vote for the Tax Relief for American Families and Workers Act isn’t going to add in any meaningful way to the deficit in the nation’s budget. It is, however, a meaningful step to shrink its deficit of affordable housing.

Stockton Williams | Executive Director

In This Issue

• House Leadership Takes Preliminary Step Needed for Floor Vote on Tax Package
• Cortez Masto, Beatty, Garamendi Introduce HOME Reauthorization Legislation
• Senate Banking Considers Local Perspectives on Flood Insurance Reform
• Fannie, Freddie Release Updated Single-Family Social Bond Frameworks
• FEMA Amends Individual Assistance Program Regulations
• More Than Half of Renters Are Cost Burdened, JCHS Report Finds
• NCSHA in the News
• Looking Ahead

House Leadership Takes Preliminary Step Needed for Floor Vote on Tax Package
House leadership this week formally posted the Tax Relief for American Families and Workers Act of 2024 as an item that may be considered on the floor next week. This is an important and necessary step towards passing the bill, which among other things includes the restoration of the 12.5 percent increase in Housing Credit authority and lowering of the bond financing threshold to 30 percent. These provisions would be temporary, going through 2025.

As we reported in last week’s Washington Report, the House is expected to consider the legislation under “suspension of the rules,” which avoids House Rules Committee consideration, limits debate to 40 minutes, and prevents amendments on the floor, which could jeopardize the compromise made between House Ways and Means Committee Chair Jason Smith (R-MO) and Senate Finance Committee Chair Ron Wyden (D-OR). Bills considered under suspension must garner a two-thirds vote to pass; the House Speaker will want to bring the tax bill to the floor only if he knows it will receive enough votes to pass.

Cortez Masto, Beatty, Garamendi Introduce HOME Reauthorization Legislation
On Tuesday, Senator Catherine Cortez Masto (D-NV) introduced an updated version of the HOME Investment Partnerships Reauthorization and Improvement Act, and Representatives Joyce Beatty (D-OH) and John Garamendi (D-CA) introduced an identical companion bill in the House of Representatives. Cortez Masto, Beatty, and Garamendi issued press releases explaining the bills would authorize $5 billion in HOME funding for fiscal year 2024 and boost the program funding five percent annually through 2028, improve HOME’s ability to provide down payment assistance to home buyers and home repair assistance to homeowners, enable HOME funds to support community land trusts and other shared equity homeownership programs, give nonprofits increased access to HOME funds, and provide state and local governments loan guarantee options that would allow them to leverage their future HOME funds for investments today.

NCSHA worked closely with Cortez Masto’s office on the drafting of the legislation on behalf of HFAs and in our capacity as chair of the HOME Coalition.

Senate Banking Considers Local Perspectives on Flood Insurance Reform
Yesterday, the Senate Banking Committee held a hearing to consider local leaders’ perspectives on reauthorizing the National Flood Insurance Program (NFIP), which has been operating under a series of short-term reauthorizations since September 2017. In his opening statement, Committee Chair Sherrod Brown (D-OH) said flooding is one of the biggest and most costly challenges communities face, so it is critical NFIP be reauthorized and strengthened. He expressed hope he could work together with Ranking Member Tim Scott (R-SC) to advance a bipartisan bill. Scott agreed with Brown about the importance of reauthorizing NFIP and said Congress should allow local communities to develop flood mitigation programs best suited to their needs. Witnesses included Michael Hecht, president and CEO of Greater New Orleans, Inc.; Steve Patterson, mayor of Athens, Ohio; and Dr. Daniel Kaniewski, public sector managing director at Marsh McLennan.

Fannie, Freddie Release Updated Single-Family Social Bond Frameworks
On Tuesday, the government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac each released updated Single-Family Social Bond Frameworks. The new frameworks outline the kinds of single-family mortgages each GSE will allow to be pooled, issued, and labeled into a social mortgage-backed security (social MBS). While both GSEs currently issue multifamily bonds designated as social bonds — bonds that meet certain environmental, social, and governance standards — neither has issued such bonds in support of single-family lending. Each firm also released a Mission Index laying out the formula it will use for determining whether an MBS meets the social bond criteria; in general, the GSEs’ criteria are identical. Fannie Mae’s new framework takes effect in March and Freddie Mac’s in June.

FEMA Amends Individual Assistance Program Regulations
The Federal Emergency Management Agency (FEMA) published Monday an interim final rule amending its regulations governing the Individual Assistance Program to increase equity by increasing eligibility for home repair assistance; allowing for the re-opening of the applicant registration period when the president adds new counties to the major disaster declaration; simplifying the documentation requirements for continued temporary housing assistance; and simplifying the appeals process. The rule also revises provisions for utility and security deposit payments, lease and repair of multifamily rental housing, child care assistance, maximum assistance limits, and waiver authority.

The rule is effective March 22 and applies to emergencies and major disasters declared on or after that date. Comments must be received no later than July 22. NCSHA would appreciate HFA input as we consider whether to respond. Please email any feedback to Jim Tassos by June 28 to inform NCSHA’s comments.

More Than Half of Renters Are Cost Burdened, JCHS Report Finds
In its annual report released this week, America’s Rental Housing 2024, Harvard University’s Joint Center for Housing Studies (JCHS) found the number of U.S. renters who are spending more than 30 and 50 percent of their income on rent and utilities jumped in 2022 to all-time highs of 22.4 million and 12.1 million, respectively. The report’s six biggest takeaways: Rental markets are softening, affordability is worse than ever before, housing instability is rising, rental assistance falls far short of the need, the rental stock has significant investment needs, and high interest rates are dampening rental market activity.

NCSHA in the News
AZ Central, 1.19.24, Arizona nonprofits, struggling to maintain aging rentals, opting out of low-income program

Looking Ahead

Legislative and Regulatory Activities

• January 30 | Comments Due | HUD 30-Day Notification Requirement Prior to Termination of Lease for Nonpayment of Rent Notice of Proposed Rulemaking
• January 31 | Senate Budget Committee | Hearing on A Blueprint for Prosperity: Expanding Housing Affordability
  Witnesses include Rhode Island Housing Executive Director Carol Ventura.
• January 31 | Senate Subcommittee on Housing, Transportation, and Community Development | Hearing on Artificial Intelligence and Housing: Exploring Promise and Peril
• February 1 | Comments Due to NCSHA | HUD Notice Changing Methodology, Limiting Annual Increases to Income Limits
• 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
• 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.