Earlier this week, the Biden-Harris administration released its Fiscal Year (FY) 2025 budget request, which serves as a marker for policy priorities, especially during a presidential election year. The budget request includes a call to expand and enhance the LIHTC in the Green Book, which outlines the administration’s tax proposals. The specific proposals, which can be found on pages 62-64, are:  

  • Increase nine percent LIHTC allocations in 2025 and 2026; 
  • Reduce the Private Activity Bond financed-by test from 50 to 25 percent for all buildings placed in service after Dec. 31, 2024;  
  • Repeal the qualified contract provision for all buildings receiving an allocation after Jan. 1, 2025; and 
  • Repeal the Right of First Refusal (ROFR) safe harbor and replace it with an option safe harbor.  

Details on the agency budgets for HUD, USDA and the Treasury are posted with details on individual program funding. The FY 2025 HUD budget request ($72.6 billion) is similar to the FY 2024 enacted appropriations levels ($70 billion) and includes additional funding for new project-based rental assistance programs for extremely low-income households and increases in funding for and access to Housing Choice Vouchers. For a comparison between FY 2024 enacted program funding levels and the FY 2025 budget request, please view the National Low Income Housing Coalition’s budget chart

What’s Next: The administration’s budget request officially kicks off the FY 2025 appropriations season. Requests for Congressionally Directed Spending are due in mid-March. Contact your Congressional office to find out their timeline and process for submitting requests.  

State of the Union: NH&RA applauds President Joe Biden for his focus on affordable housing during the State of the Union address:  

“I know the cost of housing is so important to you. If inflation keeps coming down mortgage rates will come down as well. But I’m not waiting. I want to provide an annual tax credit that will give Americans $400 a month for the next two years as mortgage rates come down to put toward their mortgage when they buy a first home or trade up for a little more space. My Administration is also eliminating title insurance fees for federally backed mortgages. When you refinance your home, this can save you $1,000 or more. For millions of renters, we’re cracking down on big landlords who break antitrust laws by price-fixing and driving up rents. I’ve cut red tape so more builders can get federal financing, which is already helping build a record 1.7 million housing units nationwide. Now pass my plan to build and renovate 2 million affordable homes and bring those rents down!”