New Tax Credit Proposed for Washington, D.C., Residents and Businesses to Boost Investment in Affordable Homes
Community Impact Investment Tax Credit Act would increase supply of homes affordable to low-income residents and working families and help prevent displacement
WASHINGTON (May 17, 2017) - At-Large Councilmember David Grosso has introduced the Community Impact Investment Tax Credit Act of 2017 to increase private investment in homes for low-income and working families, veterans, seniors and people with special needs. The bill provides a tax credit to individuals and organizations that partner with Community Development Financial Institutions (CDFIs) to make investments that preserve or create affordable homes in Washington, D.C. Councilmember Grosso was joined by Councilmembers Robert White, Elissa Silverman, Charles Allen and Anita Bonds to introduce the legislation on May 16.
“The affordable housing crisis will not be solved overnight, nor by any singular entity. Using every financing tool and partner is essential,” Councilmember Grosso said. “Through this legislation, we will continue the city’s affordable housing initiatives and multiply our public resources by promoting private investment to create more homes that D.C. residents can afford.”
“We’ve seen the impact private investors can have in our community through Our Region, Your Investment, which enables residents, businesses, foundations, and others to invest in affordable homes in the D.C. region. Over the past year more than $11 million has been invested to save nearly 300 affordable homes, preventing the displacement of families in the D.C. region,” said Lori Chatman, president of the Enterprise Community Loan Fund. “The Community Impact Investment Tax Credit Act will drive additional private investment, and we applaud Councilmember Grosso for his continued leadership on an issue critical to the success of our city.”
Enterprise Community Loan Fund is leading advocacy efforts and is among a group of 10 local CDFIs supporting the legislation. Enterprise Community Loan Fund has also provided insights on demand for a community impact investing tax credit based on its discussions with local investors through Our Region, Your Investment – a joint initiative with the Washington Regional Association of Grantmakers.
If approved, the Act will create a $1 million tax credit pilot that will generate $3 million in private investment. Participating investors may claim a credit against District income tax equivalent to 33 percent of their investment. The legislation is modeled on a successful program operating in South Carolina and draws on lessons outlined in an issue brief from Enterprise Community Partners. Published through the Accelerating Impact Investing Initiative, the brief details how government can utilize tax incentives to encourage community investing, and identified CDFIs as valuable financial intermediaries with a long track-record of successful affordable housing investments.
CDFIs are private socially motivated financial institutions that are certified by The U.S. Department of Treasury to ensure that they are meeting their mission. The Community Impact Investment Tax Credit Act of 2017 leverages their proven ability to bring together diverse public and private sector investors. As an industry, CDFIs have more than three decades of experience investing in high-impact community real estate including affordable homes, schools, health clinics and grocery stores. Learn more about CDFIs by visiting the CDFI Fund website.
To learn more, contact:
Rachel Reilly Carroll at Enterprise Community Partners: 410.884.8419 or firstname.lastname@example.org
Matthew Nocella in Councilmember Grosso’s Office: 202.724.8105 or email@example.com