Low-Income Housing Tax Credits:
News Archive
2012
March
REP. BACA INTRODUCES BILL TO FUND AFFORDABLE HOUSING
WASHINGTON, D.C. – March 9, 2012
Rep. Joe Baca, D-Calif., on Tuesday introduced H.R. 4144, the Strengthening Economic Development Through Affordable Housing Act. H.R. 4144 makes community housing development organizations eligible to receive direct funding from the State Small Business Credit Initiative (SBCI) funds for affordable housing development. The SBCI would provide not-for-profit agencies and community development corporations (CDCs) with access to funds necessary to improve blighted areas and spur economic development. The act amends Section 3003 of the State Small Business Credit Initiative Act of 2010. The bill was referred to the House Committee on Financial Services.
REPS. TIBERI AND NEAL URGE SUPPORT OF H.R. 3661
WASHINGTON, D.C. – March 2, 2012
Reps. Patrick Tiberi, R-Ohio, and Richard Neal, D-Mass., on February 28 sent a letter to members of Congress urging them to support H.R. 3661. H.R. 3661 would make permanent the fixed floor rate for 9 percent low-income housing tax credits that was enacted as part of the Housing and Economic Recovery Act. The letter says that developers will have to assume an 18 percent reduction in the amount of investor equity that they will be able to access as the 9 percent fixed floor expires. The representatives also describe the cost of the 2008 legislation as minimal.
February
OCC EXTENDS DEADLINE FOR CRA ACTIVITIES IN GULF COAST DISASTER AREA
WASHINGTON, D.C. – February 27, 2012
The Office of the Comptroller of the Currency (OCC) has extended the deadline for consideration of Community Reinvestment Act (CRA) activities in areas that were affected by hurricanes Rita and Katrina. The OCC is extending through December 31, 2014 the period that banks can receive CRA consideration for disaster recovery-related revitalization or stabilization activities. OCC Bulletin 2012-8 says weight will be given to activities that benefit low- and moderate-income individuals and areas and banks may receive CRA consideration if the activities are outside their assessment area, as long as they also meet the CRA-related needs of their local communities.
NPS RELEASES 2011 REPORT ON HISTORIC TAX CREDIT
WASHINGTON, D.C. – February 27, 2012
The National Park Service (NPS) has released its annual report on the historic tax credit (HTC) program for fiscal year (FY) 2011. The report, “Federal Tax Incentives for Rehabilitating Historic Buildings: Annual Report for Fiscal Year 2011,” includes information about the program’s use and performance throughout FY 2011. According to the NPS, the HTC has spurred $4.02 billion in new rehabilitation work, which created 55,458 jobs and 7,470 low- and moderate-income housing units. Along with the annual report, the NPS released “Federal Tax Incentives for Rehabilitating Historic Buildings: Statistical Report and Analysis for Fiscal Year 2011.” The statistical report provides a more detailed analysis of the program, including state-by-state project activity and program trends over time.
Questions about the HTC? Call Charlie Rhuda, CPA, at 617-330-1920 or Tom Boccia, CPA, at 216-298-9000.PRESIDENT RELEASES BUSINESS TAX REFORM FRAMEWORK
WASHINGTON, D.C. – February 22, 2012
The White House and the U.S. Department of the Treasury today released “The President’s Framework for Business Tax Reform.” The document outlines President Obama’s five recommendations for business tax reform. The five elements include eliminating certain tax expenditures and reforming the business tax base; refocusing the manufacturing deduction and reducing the effective rate on manufacturing, while encouraging research and development and clean energy production; introducing a minimum tax on foreign earnings; making tax filing simpler for small businesses and entrepreneurs; and either eliminating or making permanent and fully paying for temporary tax provisions now in the tax code. Renewable energy tax credits are discussed addressed in the section on extending, consolidating and enhancing clean energy incentives, but the framework does not specifically mention low-income housing tax credits, new markets tax credit or historic tax credits.
Highlights of the plan can be found in today’s Notes from Novogradac blog post. Tune into the February 28 Tax Credit Tuesday podcast to hear more about the president’s tax reform plan.PRESIDENT PROPOSES REFORM, EXPANSION OF HOUSING TAX CREDIT
WASHINGTON, D.C. – February 13, 2012
In the proposed fiscal year 2013 budget, released today, President Barack Obama proposes reforming and expanding the low-income housing tax credit (LIHTC). Specifically, the proposal would allow LIHTC properties to elect an average-income criterion, a provision that was also proposed in the fiscal year 2012 budget but not enacted. In addition, the Administration proposes allowing a 30-percent basis boost for LIHTCs for certain developments involving preservation, recapitalization and rehabilitation of existing housing that was originally financed with federal funds and is subject to a long-term use agreement limiting occupancy to low-income households; making changes to make LIHTCs more beneficial to real estate investment trusts (REITs); and requiring LIHTC-supported housing to provide protections for victims of actual or threatened domestic violence.
Michael J. Novogradac, CPA, will discuss these proposals in more detail in tomorrow’s Tax Credit Tuesday podcast.PILOT PROGRAM TO ACCELERATE LIHTC DEVELOPMENT FINANCING
WASHINGTON, D.C. – February 10, 2012
The Federal Housing Administration (FHA) today announced a pilot program to test an accelerated approval process for the purchase or refinancing of low-income housing tax credit (LIHTC) properties. The Multifamily Low Income Housing Tax Credit Pilot program aims to reduce the time needed to review and approve LIHTC-assisted financing applications from one year to 90 to 120 days by reducing the time required to review and approve financing applications under FHA’s Section 223(f) program. FHA is launching this first phase of the pilot program in Chicago, Detroit, Boston and Los Angeles.
VOLCKER RULE COMMENT PERIOD CLOSES MONDAY
WASHINGTON, D.C. – February 10, 2012
Organizations that wish to submit comments on a proposal to implement the provision of the Dodd-Frank Wall Street Reform and Consumer Protection Act commonly referred to as the Volcker Rule are reminded that the deadline to submit comments is Monday, February 13. The so-called Volcker Rule places certain prohibitions and restrictions on the ability of a banking entity and non-bank financial company to make certain kinds of equity investments, and thus could have significant implications for the tax credit equity market.
Because of the rule’s significance to the low-income housing tax credit (LIHTC), new markets tax credit (NMTC) and renewable energy tax credits, the LIHTC Working Group, NMTC Working Group and Renewable Energy Working Group will each submit comment letters on the proposed rule.
IRS INVITES COMMENTS ON LIHTC PROPERTY INSPECTIONS
WASHINGTON, D.C. – February 8, 2012
The Internal Revenue Service (IRS) today issued Notice 2012-18 to inform state housing finance agencies (HFA) participating in the Physical Inspections Pilot Program of an alternate method of satisfying certain requirements under Section 42. The pilot program was created by the Rental Policy Working Group to test the feasibility of avoiding duplicative physical inspections by conducting one coordinated inspection. The IRS also invited comments on the 20 percent rule for physical inspections and certification rule under Section 42. Comments on these topics, or Notice 2012-18, should be submitted by May 31.
To learn more about Notice 2012-18 and the Physical Inspections Pilot Program, tune in to the Tax Credit Tuesday Podcast on February 14.TCAC TO CONSIDER EXTENSION OF READINESS DEADLINE
SACRAMENTO, Calif. – February 7, 2012
The California Tax Credit Allocation Committee (TCAC) has proposed an extension of the readiness deadline to first-round 2011 low-income housing tax credit award recipients with redevelopment agency funding commitments. The 90-day extension would apply to awardees that have already received one 90-day extension. The current loan closing date is March 19, 2012; the extension would extend the closing date to June 18, 2012. TCAC will hold a hearing on the proposal and other proposed changes to the state’s qualified allocation plan on February 22.
Questions about redevelopment agency funding for LIHTC properties can be directed to James R. Kroger, CPA at jim.kroger@novoco.com.CALIF. ASSEMBLY INTRODUCES BILL TO PRESERVE RDA HOUSING FUNDS
SACRAMENTO, Calif. – February 3, 2012
The California State Assembly yesterday introduced A.B. 1585, a proposal that preserves redevelopment agencies’ unencumbered Low/Mod-Income Housing funds, which local communities use to fund affordable housing development. Under Assembly Bill 1X26, which the California Supreme Court upheld in December, redevelopment agencies were eliminated February 1. A.B. 1585 is a companion bill to S.B. 654, which passed the state senate on January 31.
January
CALIFORNIA SENATE PASSES S.B. 654
WASHINGTON, D.C. – January 31, 2012
The California State Senate today passed S.B. 654, the proposal that preserves redevelopment agencies’ unencumbered Low/Mod-Income Housing funds, which local communities use to fund affordable housing development. Under Assembly Bill 1X26, which was upheld in December by the California Supreme Court, redevelopment agencies will be eliminated effective tomorrow, February 1. The bill, which passed the senate by a vote of 34 to 1, would preserve approximately $1.5 billion for affordable housing development. S.B. 654 will now be sent to the Assembly.
PRESIDENT PROPOSES NEW TAX CREDITS IN STATE OF THE UNION
WASHINGTON, D.C. – January 25, 2012
In last night’s State of the Union address, President Barack Obama proposed a new $6 billion Manufacturing Communities Tax Credit. The proposed tax credit would provide $2 billion per year for three years to encourage investments in communities affected by job loss caused by the closure of a military base or a major employer. The president also discussed tax reform, energy tax credits and housing.
In his Notes from Novogradac blog, Michael J. Novogradac, CPA, discusses relevant points from the address, additional information that has since been released, and what these proposals mean for programs such as the new markets tax credit, historic tax credit, low-income housing tax credit and renewable energy tax credit.
BILL INTRODUCED TO INCREASE LIHTCs FOR STATES DAMAGED BY HURRICANE IRENE
WASHINGTON, D.C. – January 18, 2012
Rep. Christopher Gibson, R-N.Y., last week introduced H.R. 3769, the Irene and Lee Tax Relief Storm Recovery Act. The act would increase the amount of low-income housing tax credits (LIHTCs) that may be allocated in states damaged in 2011 by Hurricane Irene or Tropical Storm Lee. Regions included in the Irene-Lee disaster area, which the bill defines as each county covered by a qualifying natural disaster declaration and contiguous counties, would also be designated as difficult development areas under the bill. H.R. 3769 was referred to the Ways and Means Committee.
RENTAL POLICY WORKING GROUP RELEASES REPORT
WASHINGTON, D.C. – January 3, 2012
The Rental Policy Working Group (RPWG) on December 31 released its administrative proposals for the alignment of federal affordable rental housing programs. The report, called “Federal Rental Alignment Administrative Proposals” proposes ways to reduce the cost and burden of various affordable housing programs operated by the U.S. Department of Agriculture, U.S. Department of Housing and Urban Development, U.S. Department of the Treasury and others. The suggestions include aligning physical inspections, income reporting, financial reporting, energy efficiency requirements, appraisals, market study standards, subsidy layering, capital needs assessments, data sharing on owner defaults and fair housing compliance enforcement. Learn more about the Obama Administration’s ongoing rental policy alignment initiative by visiting the Rental Policy Alignment Hot Topics page.
Want to discuss the rental alignment policies with your peers? There’s still time to register for the 18th Annual Tax Credit Developers Conference, January 12-13, in Miami, Fla.