News
HUD Publishes Proposed AFFH Rule
This week, HUD released a proposed rule on Affirmatively Furthering Fair Housing (AHHF) that would dramatically alter the Obama administration’s final rule published in 2015. The rule changes the definition of AFFH and eliminates the community participation and engagement requirement as well as the requirement that federal grantees complete an analysis of impediments to fair housing. Comments on the proposed rule are due 60 days after its publication in the Federal Register.
Treasury and IRS Issue Final Regulations on Opportunity Zones
The U.S. Department of the Treasury and Internal Revenue Service (IRS) issued final (and proposed) regulations on the Opportunity Zones (OZ) tax incentive. The regulations modify and finalize the two previous proposed regulations that were issued in October 2018 and April 2019. The Treasury notes that “the final rules provide clarity for Opportunity Funds and their eligible subsidiaries in determining qualification and levels of new investment in Opportunity Zones.”
HUD Proposes to Track PBV Data
As RAD conversions continue to drive Project Based Voucher (PBV) growth, HUD proposes to fill an information gap to enable monitoring, tracking and analysis of PHAs’ PBV performance. Comments are due February 24, 2020.
Freddie Mac White Paper Details Efforts to Preserve Affordable Housing as Areas of Concentrated Poverty Are Revitalized
A new white paper released by Freddie Mac details how communities can use mixed-income and social impact housing to stimulate economic growth and diversity while preserving affordable housing. The research examines properties in areas of concentrated poverty, which are areas designated by the Federal Housing Finance Agency that are characterized by disinvestment, persistently high poverty levels, low economic opportunity and high housing costs relative to income.
Congress Advances End-of-Year Spending Bill, Tax Package
Yesterday the House of Representatives voted to approve federal funding for the remainder of FY 2020, which will provide $738 billion to the military and $632 billion to non-defense agencies. The Senate is expected to pass the measures before the current continuing resolution expires on December 20, and the White House has indicated President Trump will sign them into law.
OCC Releases CRA Proposed Rule
Last week the Office of the Comptroller of the Currency (OCC) and the Federal Deposit Insurance Corporation (FDIC) released a proposed rule that would modernize the Community Reinvestment Act (CRA) Regulations. The proposal would overhaul CRA assessment boundaries, criteria for eligible CRA activities, and how banks are scored overall for their performance.
Senators Introduce Eviction Crisis Act
Senators Michael Bennet (D-CO) and Rob Portman (R-OH) introduced the Eviction Crisis Act of 2019 to shed light on the root causes of the eviction crisis, reduce preventable evictions and limit the devastation to families when eviction is unavoidable.
Virginia Governor Proposes $113 Million for Affordable Housing in 2020-2022 Budget
Governor Ralph Northam (D-VA) announced his proposed budget will include $92 million in new funding to address housing affordability, eviction rates and supportive housing throughout the Commonwealth. The Governor’s proposed budget invests $63 million in the Virginia Housing Trust Fund (VHTF), bringing the total amount to $84 million over three years.
US Conference of Mayors Calls on Candidates to Expand HUD Funding
The United States Conference of Mayors has issued a new report “Mayor’s Vision For America: A 2020 Call To Action” which calls for new investments in infrastructure, innovation and inclusion. The report outlines 12 priorities including to “make housing more affordable and end homelessness.” The report specifically calls for increased funding for the Community Development Block Grant and HOME Program as well as the creation of a new program for blighted neighborhood restoration. Additionally, the report calls for the expansion of rental housing supply noting, “There is an increased need for rental housing. The nation needs to create and pursue policies to develop more rental housing.
Bill Introduced in South Carolina to Create State LIHTC for OZs
On November 20, 2019 Legislation introduced in the South Carolina Legislature that would create a state low-income housing tax credit (LIHTC) for properties in opportunity zones. Analysis of the legislation by Novogradac & Company finds that the measure “would create a 25 percent tax credit for investment in the state’s OZs and add OZs to other state incentive programs.
Legislation Introduced to Establish Reporting Requirements for Opportunity Zone Incentive
U.S. Senator Tim Scott (R-SC) was joined today by Senate Finance Committee Chairman Chuck Grassley (R-IA), Senators Marco Rubio (R-FL), Shelley Moore Capito (R-WV), Todd Young (R-IN), Joni Ernst (R-IA), Bill Cassidy (R-LA), and Cory Gardner (R-CO) in the introduction the IMPACT Act, which would reinstate and expand reporting requirements to determine the impact of the more than 8,700 Opportunity Zones across the country.
IRS Issues BEAT Tax Rules
The Internal Revenue Service (IRS) has issued a final regulation on the implementation of the the base erosion and anti-abuse (“BEAT”) tax, which was part of the Tax Cuts and Jobs Act and was designed to prevent the reduction of tax liability by certain large corporate taxpayers through certain payments made to foreign related parties and certain tax credits. The BEAT Tax impacts certain LIHTC, NMTC and Historic Credit investors that are either foreign owned or have significant foreign operations. It has the potential to erode an investor’s benefit from tax credits and losses over time. The final regulations retain the basic approach and structure of the proposed regulations, with certain revisions.