LIHTC Has Developed or Preserved Over 49,000 NJ Homes
The Senate Finance Committee, House Ways and Means Committee, congressional leaders and the White House are finalizing the details of the tax extender legislation and this may be the last chance to influence the bill in support of permanent minimum 9% and 4% Housing Credit rates. The debate over tax extenders legislation is moving quickly, and the bill could be finalized in the next week or two.
Minimum 9% and 4% Housing Credit rates should be extended permanently. Minimum Housing Credit rates must be extended for at least two years in order to have any practical benefit. A retroactive extension of minimum credit rates for 2015 only would not benefit developments for which the credits have already been awarded.
Minimum Housing Credit rates make the development of affordable housing more predictable and financially feasible. With the ‘floating rate’ in effect, there is 15 – 20% less Housing Credit equity available for any given affordable housing development, creating financing gaps that are increasingly difficult to fill.
Minimum Housing Credit rates provide significant benefit for minimal cost. The Joint Committee on Taxation estimates that the minimum 9% and 4% rate extensions included in the Senate Finance Committee-passed tax extenders legislation would cost only $5 million over 10 years.
Minimum Housing Credit rates have strong bipartisan support. The minimum Housing Credit rate legislation in the Senate, S. 1193, has 29 co-sponsors, including 7 members of the Senate Finance Committee. The companion legislation in the House, H.R. 1142, has 77 co-sponsors, including 28 members of the Ways and Means Committee. The Senate Finance Committee also approved its extension of minimum 9% and 4% rates with bipartisan support.
Permanently extending minimum credit rates will ultimately benefit low-income families. The White House maintains that if any tax extenders are made permanent, some of them must benefit lower- and middle-income families.
The Housing Credit benefits urban, suburban and rural communities in every state.