On March 24 the U.S. House of Representatives passed a $16.8 billion package of tax incentives (HR 4849) for state and local governments and small businesses, the second measure in the Democrats’ “jobs agenda” to pass the chamber this month.  The measure passed on a largely partisan 246-178 vote.  Key provisions include:

  • An extension of the Build America Bond Program until April of 2013.  The program provides financial support to state and local governments through federal tax exemptions for interest on municipal bonds and is being used increasingly in conjunction with the LIHTC.  The bill also includes provisions that will lower the applicable percentage for the Build America Bond program over time along the following schedule:
    • 2009 or 2010: 35 percent
    • 2011: 33 percent
    • 2012: 31 percent
    • 2013: 30 percent
  • An expansion of the 1602 LIHTC Exchange program to projects financed using tax-exempt bonds with 4 percent tax credits.
  • An exemption that would allow new markets tax credits to be used to offset the alternative minimum tax. Similar exemptions are already in place for the LIHTC and Historic Tax Credit.

The measure now awaits consideration by the U.S. Senate, which is expected to take action some time after the April Congressional Recess. It is being reported that HR 4849 will likely be the next major piece of legislation considered by the Senate Finance Committee.

Updates On Other Important Legislation

HR 4213: Extends for an additional year the 9 percent Section 1602 LIHTC exchange program. This measure also extends the Gulf Opportunity Zone (GO Zone) Low-Income Housing Tax Credit placed-in-service deadline as well as GO Zone Historic tax credit and bonus depreciation benefits. Other highlights include a one-year extension of the New Markets Tax Credit Program at a $5 billion annual volume. H.R. 4213, as amended by the Senate, now awaits House passage. Recent reports from House Ways & Means Chairman Sander Levin indicate that the final passage may be delayed over concerns over how the measure will be paid for.

S. 3141: U.S. Senator Jeff Bingaman (D-NM) recently introduced new legislation aimed at stimulating new affordable housing development by adding incentives to the low-income housing tax credit (LIHTC) program. Bingaman’s bill (S.3141), entitled the “Low Income Housing Tax Credit Recovery Act of 2010,” allows the credits for existing and future investments to be carried back up to five years. It is estimated that the bill would generate $10 billion in construction activity, over 80,000 homes and about 100,000 jobs in distressed rural and urban communities. Efforts are being made to incorporate this legislation as an amendment into HR 4849 when it is considered by the Senate Finance Committee.

To Learn More…

Given all the changes down in Washington, we are pleased to announce that we will once again be hosting our Spring Policy Forum, May 20-21 at the Liaison Hotel, Washington, DC. Registration is now open and the hotel is taking reservations. We will be covering in detail all these recent developments and more importantly how they will impact your next transaction or create new business opportunities. The program is designed for developers and affordable housing professionals looking to learn the latest policy developments affecting their business and will provide unique opportunities to network with key policy makers.

Expert panelists from the Hill and Federal Government include:

  • Jon Sheiner, House Ways & Means Committee
  • Nick Wyatt, Senate Finance Committee
  • Sue Wilson, US Department of Housing & Urban Development (Public & Indian Housing)
  • Ben Metcalf, US Department of Housing & Urban Development (Federal Housing Administration)
  • …and many more to be announced shortly from key Congressional Committees, HUD, IRS, CDFI Fund and the Office of Management and Budget

NH&RA Spring Policy Forum
May 20-21, 2010
The Liaison Hotel
Washington, DC

Click here to view the conference agenda
Click here to register online
Click here to reserve your hotel room

Feel free to give me a call at 202-939-1753 or [email protected] if you have any questions about the legislation or event.

NH&RA Thanks Our Spring Policy Forum Sponsor