Bill Introduced to Make Permanent LIHTC Floor
Reps. Pat Tiberi (R-OH) and Richard Neal (D-MA), recently introduced a bill that would create a permanent floor for the Low Income Housing Tax Credit. The legislation would make the 9 percent tax credit rate permanent for new construction projects. The legislation proposed last week also included a provision that would establish a 4 percent floor on the tax credit rate for acquisition costs (but not for projects financed with tax-exempt bonds).
The bill, which is essentially identical to legislation Tiberi and Neal introduced in the last Congress, already has bipartisan support. Of the 18 original cosponsors, including the bill’s lead sponsors, nine are Republicans and nine are Democrats.
The fixed 9 percent rate was first implemented by the Housing and Economic Recovery Act of 2008 and was extended in December of last year as part of the Tax Increase Prevention Act of 2014. However, the December extension applied only to projects with credit allocations prior to Jan. 1, 2015, that had not already elected to fix the rate. The proposed legislation would fix the 9 percent rate for all projects placed in service after Dec. 31, 2014.
Senators Pat Roberts (R-KS) and Maria Cantwell (D-WA) are expected to introduce similar legislation to the Senate soon.