Sen. Bill Cassidy (R-LA) and Sen. Mark Warner (D-VA) introduced the Historic Tax Credit Growth and Opportunity Act (S. 1459). A companion bill is expected to be introduced in the House soon by Rep. Darrin LaHood (R-IL) and Rep. Tom Suozzi (D-NY).

Click here to learn more, get talking points, and receive updates on the bill.

What’s next: The Senate is looking for co-sponsors. The Historic Tax Credit Coalition Lobby Day, Wednesday, June 11.

Key provisions include:

  • Returns to a one-year delivery of Historic Tax Credits for all projects
    • Since 2017, the 20 percent tax credit has been delivered over five years (four percent per year); this provision will return delivery of the HTC to one year.
  • Lowers the Substantial Rehab Test from 100 percent to 50 percent of a building’s basis
    • Lowers the substantial rehabilitation threshold, making more projects eligible to use the HTC.
  • Eliminates the HTC Basis Adjustment Requirement
    • Eliminates the requirement that the amount of the HTC must be deducted from a building’s basis (the property’s cost for tax purposes), increasing the value of the HTC and making it much easier to pair with the Federal LIHTC.
  • Modifies Tax-Exempt Use Rules
    • Makes the HTC easier to use for nonprofits, such as community health centers, local arts centers, affordable housing providers, homeless services organizations, museums, theaters, and others, by eliminating tax code restrictions that previously made it challenging for nonprofits to partner with developers.
  • Increases the credit for smaller projects:
    • Projects below $3.75 million will receive a 30 percent credit;
    • Rural projects below $5 million will receive a 30 percent credit. (Rural Definition: Cities/towns with populations less than 50,000 and not contiguous and adjacent to cities/towns of 50,000 in population); and
    • All small projects are eligible for direct transfer, without the need for a partnership-style investment.