Recent News
Maryland Gov. Larry Hogan signed legislation extending the state historic tax credit (HTC) by seven years, altering annual caps for specific uses of the state HTC, increasing funding for the HTC reserve fund and increasing the annual set-aside for a small commercial project trust account. H.B. 27 extends the credit sunset from 2024 through the end of fiscal year 2031 and increases the annual state HTC cap for developments in a Level 1 opportunity zone (OZ) to $5.25 million, Level 2 OZ to $5.5 million and any other commercial rehabilitation outside a Level 1 or Level 2 OZ to $5 million. The annual budget set-aside for the reserve fund will increase from $12 million to $20 million for 2023 through 2031 and the annual funding for the small commercial project trust account will have an annual appropriation of $2 million.
Legislation to extend the state low-income housing tax credit (LIHTC) through 2031 passed both houses of the Legislature and is on the desk of Gov. Jared Polis. H.B. 1051 extends the sunset date for the credit from Dec. 31, 2024, to Dec. 31, 2031. The legislation also provides that state credits allocated to developments in counties impacted by federally declared disasters–solely for leveraging state and federal natural disaster funds–do not count against the annual state cap.
South Carolina Gov. Henry McMaster signed into law H. 5075 on May 16, restricting the allocation of the state low-income housing tax credit (LIHTC) to $20 million annually and defining specific areas and types of housing that must receive at least a minimum amount of credits. The total amount of state LIHTCs allocated to qualified developments using the federal 9% LIHTC cannot exceed 40% of the $20 million limit. Of those, not less than 50% of the state LIHTCs must be allocated to qualified developments in eligible rural areas, with the remainder allocated to developments serving older persons or persons with special needs, workforce development and other qualified developments.
The Biden administration today announced its Housing Supply Action Plan to close the housing supply shortfall in five years, including the creation and preservation of hundreds of thousands of affordable homes in the next three years. The plan calls for investments in housing production and preservation, such as those outlined in the House reconciliation bill to increase the annual low-income housing tax credit (LIHTC) allocation cap and create the Neighborhood Homes Tax Credit. The White House cited Novogradac analysis that found that the reconciliation bill could finance nearly 1 million affordable homes over 2022-2031.
Bipartisan legislation introduced Wednesday in the U.S. Senate would allow governments to use Coronavirus State and Local Fiscal Recovery Funds (SLFRF) to make long-term loans to low-income housing tax credit (LIHTC) developments. The LIHTC Financing Enabling Long-Term Investment in Neighborhood Excellence (LIFELINE) Act would allow states and local governments to use SLFRF funds to make long-term loans to LIHTC developments. The bill seeks to ease financing gaps due to rising construction costs, price increases, supply chain issues, workforce difficulties and more related to the COVID-19 pandemic. Sens. Patrick Leahy, D-Vermont, and Susan Collins, R-Maine, introduced the legislation. A companion bill, H.R. 7078, was introduced in the House in March.
