Senators Issue 'Dear Colleague Letter' for LIHTC Bill
Senators Cantwell and Snowe recently circulated a Dear Colleague letter seeking support for S. 1989. The bill would prevent a significant reduction in the amount of investor equity that can be used to build affordable housing by making permanent a temporary provision enacted in 2008 that established a minimum tax credit rate for the Low-Income Housing Tax Credit program while establishing a minimum credit for existing buildings. In other words, it would make permanent the 9 percent minimum credit rate and establish a fixed rate for the 4 percent acquisition credit.
The letter warns that in the next few weeks, affordable housing developers will have to begin assuming reduction in the amount of investor equity they will be able to access to build affordable housing. That reduction is estimated to be approximately 18 percent. The letter goes on to note that when combined with budget cuts at the local, state, and federal level, this further cut in resources for affordable housing will make it even more difficult to build and preserve affordable housing.
This letter is the latest action by Sen. Snowe in support of the LIHTC program. The senior senator from Maine recently announced that she will not seek re-election this year. For years, she has been the key Republican supporter of the LIHTC program, and her departure raises the question of who will fill her shoes.