Low-Income Housing Tax Credits News Briefs - June 2021

Tuesday, June 1, 2021

LIHTC Industry

A bipartisan group of legislators introduced the Affordable Housing Credit Improvement Act of 2021 (AHCIA) April 15 in both chambers of Congress. Novogradac estimates the primary unit financing provisions of the bill could finance as much as 2 million additional affordable rental homes over 10 years. The legislation would lower the financed-by threshold for private activity bonds (50% test) from 50% to 25% starting in 2022; increase 9% low-income housing tax credit (LIHTC) authority by 25% in 2021 and 2022; extend the discretionary 30% basis boost for 9% LIHTC properties to PAB-financed properties; provide a 30% basis boost for properties in rural and Native American areas; and more. AHCIA provisions are expected to be considered as a key part of $213 billion in housing resources of the Biden administration’s American Jobs Plan, a $2.25 trillion infrastructure plan.

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The U.S. Department of Treasury released the Made in America Tax Plan report April 7, providing additional details on the infrastructure plan announced March 31 by President Joe Biden’s administration. The description includes a statement that there would be “a marked increase in the resources available through the low-income housing tax credit [LIHTC] and other housing incentives,” but the report focuses on renewable energy provisions. The report includes a call to raise the corporate income tax rate from 21% to 28%, strengthen the global minimum tax for U.S. multinational corporations and other changes.

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The Urban Institute released a brief report March 30 about the nation’s housing supply shortage, calling for “policymakers … [to] expand the Low-Income Housing Tax Credit [LIHTC], Section 142 tax-exempt bonds for the development of rental housing and the New Market Tax Credit [NMTC], each of which has proven effective in promoting development in underserved communities.” The report, “Overcoming the Nation’s Daunting Supply Shortage,” points out that there is less housing available for rent and sale than any time in in the past 30 years and particularly highlights the shortage of affordable housing.

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Legislation introduced in both houses of Congress April 26 would leverage federal funding to build or rehabilitate homes for lower- and middle-income families, provide $10 billion in grants to local governments that reform land-use rules that restrict production of affordable housing and provide down payment grants to first-time homebuyers living in formerly redlined or officially segregated areas. The American Housing and Economic Mobility Act was introduced by lead sponsors Rep. Emanuel Cleaver II, D-Missouri, and Sen. Elizabeth Warren, D-Massachusetts. The bill would require specific allocations to the Housing Trust Fund, Capital Magnet Fund, Public Housing Capital Fund and a variety of housing programs. The legislation would make it easier to use housing vouchers in neighborhoods with good schools and good jobs, as well as to allow tribal housing authorities to administer their own voucher program. Supporters of the legislation also released an analysis of the legislation by Moody’s Analytics that said the bill would build or rehabilitate nearly 3 million units over the next decade and save families and average of $100 per month.

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The Office of the Comptroller of the Currency released a list of Community Reinvestment Act performance evaluations made public in March, with 14 of the 15 institutions receiving ratings of satisfactory or outstanding. One institution received a needs-to-improve rating. The list contains only national banks, federal savings associations and insured federal branches of foreign banks.

LIHTC State

Legislation introduced in the Louisiana House of Representatives April 6 would repeal the state LIHTC and reduce the state new markets jobs act credit and historic tax credit by 50% each. H.B. 454 includes the repeal of 12 tax credits and the reduction by 50% of 45 other credits.

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Wisconsin Housing and Economic Development Authority announced federal and state LIHTC awards April 27 for its 2021 round totaling $35 million. The awards are expected to create 2,200 affordable homes across 33 developments. The department awarded more than $31.9 million in tax credits during the 2020 round.

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A bill introduced in the North Carolina Senate April 6 would reinstate the state LIHTC that expired in 2015. S.B. 588 would allow credits worth varying percentages, depending on the makeup and location of the development, to properties that receive a federal LIHTC allocation. Taxpayers who receive a federal LIHTC would be able to receive the credit as a direct tax refund or as a loan generated by transferring the credit to the state housing agency. The state LIHTC would be effective for taxable years beginning on or after Jan. 1, 2021, and would be repealed for properties that receive federal credits after Jan. 1, 2025.

LIHTC Dealmaker

WinnDevelopment announced April 1 that it has begun construction to convert the remainder of the Cliftex Mill building in New Bedford, Massachusetts. Once completed, the development will provide 71 mixed-income homes for seniors and on-site supportive services. The adaptive reuse of Cliftex Mill will complete the residential development of Manomet Place which provides 76 affordable homes for seniors who earn up to 100% of the area median income (AMI).

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Wendover Housing Partners held a groundbreaking ceremony March 31 for Hawthorne Park, a new senior affordable community in Orlando. The development will provide 120 affordable homes and will replace a portion of an underused shopping center. The development was allocated $23 million in LIHTCs from Florida Housing Finance Corporation.

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KeyBank’s Community Development Lending and Investment division announced April 5 that it has provided $23 million in financing for the development of an affordable housing community for seniors in Canonsburg, Pennsylvania. The financing includes $12 million in LIHTC equity and an $11 million construction loan. The development will provide homes for seniors earning between 20% and 60% of the AMI.

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The Washington, D.C., Department of Housing and Community Development announced April 6 that is has provided local and federal financing for the development of 54 affordable housing units at the Abrams Hall Senior Apartments. Abrams Hall is a joint venture between Urban Atlantic and Housing Up, a local nonprofit organization. The development was allocated $11 million in 9% LIHTCs.

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Grace Inspired Ministries along with development partner Leon N. Weiner Associates, Inc. announced plans April 21 for the formal groundbreaking for Sellersville Senior Apartments in Telford, Pennsylvania. The development will provide 50 affordable apartments, eight of which will be supportive housing, and will be built to the highest energy-efficiency standards using the Department of Energy Zero Energy Ready program. The development was awarded LIHTCs by the Pennsylvania Housing Finance Agency.

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Millie Lacs Corporate Ventures announced April 14 that it was awarded LIHTCs by the Minnesota Housing Finance Agency for the financing and development of Red Willow Estates in Onamia, Minnesota. The development will provide 30 affordable townhomes for families. Red Willow Estates is scheduled to be completed by late 2022.

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Spire Development announced April 21 that Hempstead Landing, an affordable housing development in Kettering, Ohio, is under construction after receiving a 9% LIHTC award from Ohio Housing Finance Agency. The development will provide 54 homes for those who earn between 60% and 120% of the AMI.

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The Berkshire Housing Development Corp announced April 24 that it is accepting tenant applications for the Cole Avenue Apartments in Williamstown, Massachusetts. The applications were to be awarded via lottery May 12. The development was financed in part by $9.3 million in federal LIHTCs and an additional $4.1 million in state LIHTCs. The development will provide 40 affordable apartments and most tenants will pay no more than 30% of their income on rent.

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Hunt Capital Partners and Community Development Partners announced April 13 the closing of $8.5 million in federal LIHTC equity for the construction of St. Michael’s Community Housing in Riverside, California. The development will provide 50 affordable apartments for low-income families.

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Mission Housing Development Corporation and BRIDGE Housing held a virtual ribbon-cutting ceremony April 15 for La Fenix at 1950 in San Francisco. The development will provide 155 affordable homes for households that earn between 45% and 60% of the AMI. Forty apartments will be set aside for families who were formerly experiencing homelessness.

LIHTC People

Bellwether Enterprise Real Estate Capital LLC announced April 6 that Kamara Green was hired as national director of affordable analytics and sales. Green will join the company’s national agency team, where she will manage the affordable analytics team. Green will oversee Fannie Mae, Freddie Mac and private placement deals. Green has 18 years of multifamily experience, with a focus on affordable housing debt and equity products.

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BRIDGE Housing announced April 2 that Daryl J. Carter was elected to the board of directors. Carter is the founder and CEO of Avanath Capital Management LLC, an investment firm that renovates apartment properties with an emphasis on affordable and workforce communities. He has 40 years of experience in the commercial real estate industry and was previously an executive managing director of Centerline Capital Group.

LIHTC Bond

Sen. John Hoeven, R-North Dakota, and Sen. Ron Wyden, D-Oregon, reintroduced the Move America Act April 29 to bring billions of dollars to grow and repair infrastructure through an expansion of private activity bonds and the creation of an infrastructure tax credit. S. 1403 would allocate Move America Bonds to states, based on population size. The legislation would allow smaller states the ability to trade in some or all of their bond allocation for federal tax credits at a 25% exchange rate. The Move America Act would leverage $8 billion in federal investment into $226 billion of bond authority or up to $56 billion in tax credits over 10 years, according to the Joint Committee on Taxation. This is the fourth consecutive session of Congress in which the legislation has been introduced.

Journal Category: 
Low-Income Housing Tax Credit
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