Capitol Express Newsletter: Congress Approves Disaster Recovery Funding, New Tax Reform Details Anticipated Soon
CONGRESSIONAL AND ADMINISTRATION NEWS
Congress Passes First Round of Disaster Relief and Recovery
On September 8, the President signed into law the first round of disaster relief and recovery funding. The $15.25 billion package includes $7.4 billion for the Federal Emergency Management Administration disaster relief fund, $450 million for Small Business Administration Disaster Loans and $7.4 billion for the Community Development Block Grant Disaster Recovery program. The funding applies to major declared disasters occurring in 2017, meaning that it will assist regions affected by Hurricanes Harvey and Irma, in addition to other federally-declared disasters this year. The recovery package is part of a larger deal that also included a continuing resolution (CR) to fund the government at FY 2017 levels until December 8, an extension of the National Flood Insurance Program (NFIP) until December 8 and an increase in the debt ceiling that will last several months. Read more about the first relief and recovery installment on Enterprise’s blog.
Later this fall Congress is likely to approve further federal disaster assistance, which may include disaster tax relief legislation. After Hurricanes Katrina and Rita, Congress passed the Gulf Opportunity (GO) Zone Act, which established an area in which businesses and individuals were eligible for a package of tax benefits that included increased allocations of the Low-Income Housing Tax Credit (Housing Credit), New Markets Tax Credit (NMTC), bonds and historic tax credits. However, no corresponding legislation was enacted after Superstorm Sandy or the many other recent natural disasters. To address the unmet need from previous years, Rep. Tom Reed (R-NY-23) reintroduced the Natural Disaster Tax Relief Act (H.R. 3679) on September 7 to provide a similar tax relief package to federally declared natural disasters from 2012 to 2015. If this bill advances, it would likely be updated to include disasters through 2017, and potentially provide automatic relief for future disasters. Enterprise strongly supports tax relief for communities impacted by disasters.
House Sends Appropriations Omnibus to the Senate
In addition to passing a CR that funds the government through December 8, the House also passed a 12-bill appropriations omnibus package last week. Consideration took two weeks as a result of the nearly one thousand amendments that were submitted. Several amendments that were accepted would impact affordable housing and community development, including two that increased funding for the Community Development Block Grant program by a total of $110 million to $3.01 billion, and one that increased funding for the Section 4 Capacity Building program by $5 million to $35 million. The House bill still reduces funding for the HOME Investment Partnerships by $100 million to $850 million, an historic low for the program. The Senate will most likely not consider the CR and is instead expected to negotiate a large omnibus package by December. Learn more about the House and Senate bills on Enterprise’s blog.
Congress to Release New Details on Tax Reform Next Week
Republican leadership in the House outlined a path forward for tax reform last week, saying that they will release more tax reform details the week of September 25 and will advance a budget resolution in October with language for tax reform. The “Big 6” – a group of top policymakers in Congress and the Administration – continues to negotiate towards a consensus on tax reform, although reports indicate that the group is still undecided on a number of critical items, including how to pay for cuts to the corporate and individual tax rates. The tax-writing committees also continue to hold hearings on tax reform, with the Senate Finance Committee holding a hearing on business tax reform tomorrow. The Senate Finance Committee also held a hearing on individual tax reform last week, during which Sens. Maria Cantwell (D-WA) and Johnny Isakson (R-GA) spoke positively about the Housing Credit, with Sen. Isakson specifically identifying its importance after natural disasters like Hurricanes Harvey and Irma.
As tax reform discussions intensify in the House and Senate, it is a critical time for advocates to make the case to preserve, strengthen and expand the Housing Credit and NMTC. We encourage all Housing Credit advocates to use the newly updated ACTION Campaign state fact sheets and other materials in the ACTION Campaign's Advocacy Toolkit to show policymakers the local impact of the Housing Credit and the affordable housing needs that remain. Visit the NMTC Coalition's website for advocacy resources to support the NMTC.
Senate Confirms Pam Patenaude to be Deputy Secretary at HUD
Last week, the Senate voted 80-17 to confirm Pam Patenaude to be the Deputy Secretary at HUD. Patenaude has a long tenure in the housing and community development sphere, serving as HUD’s Assistant Secretary for Community Planning and Development under George W. Bush, Executive Vice President of the Urban Land Institute and Director of Housing Policy at the Bipartisan Policy Center. Patenaude also served as an adviser to Presidents Ronald Reagan and George W. Bush, and most recently as president of the J. Ronald Terwilliger Foundation for America’s Families. Patenaude will begin her role at HUD as the agency faces critical decisions about how to best support communities recovering from natural disasters. Read Enterprise’s statement on Patenaude’s confirmation. Enterprise previously issued a statement in support of her nomination, and joined 60 organizations in signing onto a letter urging Senate leadership to advance her nomination.
Robert Hunter Kurtz has also been nominated to serve as Assistant Secretary for Public and Indian Housing at HUD. Mr. Kurtz currently serves as Deputy Chief of Staff for Policy and Programs at HUD in the Office of the Secretary. He has extensive experience in housing policy at both the local and federal levels.
Senate Democrats Urge Treasury to Allow Fannie and Freddie to Amass Capital
Last week, Senate Democrats sent a letter to Treasury Secretary Steven Mnuchin and Federal Housing Finance Agency Director Mel Watt asserting that Fannie Mae and Freddie Mac (the GSEs) should be allowed to amass capital to avoid another taxpayer bailout. While the GSEs have largely recovered since the housing collapse in 2007 – sending nearly $273 billion in earnings to the Treasury Department since being placed under government conservatorship – their capital will be exhausted by the end of this year, raising the risk that they’ll need another injection of taxpayer aid. The letter from Senate Democrats comes on the heels of a policy shift by the Republican National Committee, which last month adopted a resolution calling for recapitalization of the mortgage companies. These new positions could signal movement towards a bipartisan consensus on reforming Fannie and Freddie. Last week at a Politico concerence Secretary Mnuchin said that more work needs to be done to fix the GSEs before they are in a position to be released from government control.
RESEARCH AND REPORTS
New Report Finds Positive Results About the State of Housing Credit Properties
CohnReznick released its sixth survey of Housing Credit properties last week, finding that Housing Credit properties are operating better than any period in the program’s history. The report examines how Housing Credit developments are financed, how public-private partnerships foster an efficient use of the capital subsidy, why institutional investors invest in Housing Credits, economic occupancy strength, improvements in debt coverage ratio and overall strong cash flow for Housing Credit properties. The report also details the rising number of low-income renters who need affordable housing, underscoring the need to expand the Housing Credit to help more of the 11.2 million severely cost-burdened renter households.
New GAO Report Examines Funding Gaps in Rural Housing Subsidies
A new report by the Government Accountability Office (GAO) examines the reasons why the U.S. Department of Agriculture’s Rural Housing Service (RHS) agency ran out of funds for renewing rental assistance agreements in fiscal years 2013–2015. USDA’s RHS administers programs that provide loans, grants, and loan guarantees to build and improve multi and single-family housing and community facilities in rural areas nationwide. According to the report, an interplay of three primary factors contributed to the funding gaps in the RHS rental assistance program: fiscal year 2013 sequestration and rescissions, unreliable methods for estimating rental assistance costs and limited management flexibility. In recent years, Congress has appropriated about $1.4 billion for the Section 521 Rental Assistance program which provides rental subsidies to owners of multifamily housing for more than 270,000 low-income households in rural areas nationwide.
HUD Finds People with Mental Disabilities Face Significant Housing Discrimination
HUD recently released a five-part study entitled "Rental Housing Discrimination on the Basis of Mental Disabilities: Results of Pilot Testing", which found that people living with mental illness or other developmental disabilities continue to face significant discrimination in the rental housing market. Compared to people without mental disabilities, those persons receive fewer responses to their rental inquiries, are less likely to be invited to tour a unit and are more likely to be steered to a unit different from the one advertised, among other forms of discrimination. In response to these findings, HUD Secretary Ben Carson restated a commitment to ensuring "equitable housing opportunities for all".
STATE AND LOCAL POLICY
California State Legislature Approves Package to Address Affordable Housing and Homelessness
Last week, the California State Legislature approved a series of bills designed to address the affordable housing crisis throughout the state. The three bills at the center of the housing package create a new permanent source of funding for affordable housing, estimated at $250 million a year, through a fee on certain real estate transactions, place a $4 billion bond on the 2018 state ballot and ease some local development restrictions. Enterprise has worked with our partners to support a statewide advocacy strategy for state action in addressing California’s affordable housing crisis. Governor Jerry Brown has expressed his intention to sign the package into law.
Louisiana Shares Housing Recovery Lessons for Harvey Victims
As Texas gears up to address the housing needs of its residents after Hurricane Harvey, Louisiana is sharing its experience with providing short-term housing relief in the wake of massive flooding. The state has collected key lessons learned from implementation of Shelter at Home, a program designed to enable families to return to their homes swiftly by providing temporary fixtures such as sinks and begin rebuilding for the long-term. While programs of this kind may alleviate the cost of temporarily housing individuals in hotels and other shelters and reduce the impact on already strained rental markets, an article in The Advocate highlights the price tag of providing homes through temporary fixes that are ultimately replaced.
California Seeks to Increase Access to Opportunity Through Housing Credit Developments
Last week, the California State Tax Credit Allocation Committee (TCAC) published proposed regulatory changes that would incentivize developers to place new Housing Credit properties in higher opportunity areas, based on new regional opportunity maps. These proposed changes seek to increase the number of new, large family Housing Credit developments in higher-resourced areas with lower levels of racial segregation and concentrated poverty. Enterprise, a member of the state fair housing task force that designed the opportunity tool for TCAC and the California Department of Housing and Community Development (HCD), supports increasing access to opportunity for low-income families by developing more affordable homes for families in areas with greater resources.
IN CASE YOU MISSED IT
News Updates from Community Developments
In recent Community Developments, we highlighted a report on national food insecurity, the rise in the share of home loan originations that include co-borrowers, the challenges facing New York City’s homeless, school-aged children, and much more.
HEARINGS AND EVENTS
Featured Event: Enterprise Hosts Undesign the Redline Exhibit in D.C. this Month
Social Impact firm Designing the WE, in partnership with Enterprise, is hosting the Undesign the Redline exhibit in the District of Columbia. Undesign the Redline is an interactive exhibit connecting the intentional and systemic racial housing segregating of the 1930s to political and social issues of today, through the powerful narratives of the people and communities affected by redlining and its legacy. The exhibit is open to the public through September 28 at the Pepco Edison Place Gallery. Learn more about exhibit dates, times, tours and special events on Enterprise's website.
Upcoming Hearings and Mark-Ups
- September 19: Hearing on Business Tax Reform, Senate Finance Committee
- September 20: Hearing on Aging with the Community: Building Connections that Last a Lifetime, Senate Committee on Aging
- September 6-28, Undesign the Redline, Enterprise Community Partners and Designing the WE (Washington, D.C.)
- September 19: NY Affordable Housing Conference, Bisnow (New York)
- September 20: Tax Credits 101: The Beginner's Guide to LIHTCs as a Financing Tool, NAHRO and Enterprise Community Partners (webinar)
- September 20: Climate Preparedness and Resiliency in Rural Communities, Enterprise Community Partners (webinar)
- September 21-22: SCANPH Annual Conference, Southern California Association of Non Profit Housing (Los Angeles)
- September 22: Maine Affordable Housing Conference, Maine State Housing Authority (Portland, Maine)
- September 25: Building Healthier Economies with CDFIs, Urban Institute (Washington, D.C.)
- September 26: Opportunity360 Launch, Enterprise Community Partners (livestream)
- September 26-28: CDFIs Invest, Opportunity Finance Network (Washington, D.C.)
- September 27-28: IRHP Las Vegas, Institute for Responsible Housing Preservation (Las Vegas)
- September 28: Novogradac 2017 Historic Tax Credit Conference, Novogradac and Co., (Denver)
- September 30: Building Opportunities: 37th Annual NPH Fall Conference, Non-Profit Housing Association of Northern California (San Francisco)
- October 2-4: 2017 I'M HOME Conference, Prosperity Now (Providence, R.I.)
- October 2-4: Housing Washington 2017 (Spokane, Wash.)
- October 4: Ohio Housing Council Fall Symposium (Columbus, Ohio)
- October 4: A Community of Leaders: United in Vision, Acting for Justice, CNHED (Washington, D.C.)
- October 5: Novogradac 2017 Credit and Bond Financing for Affordable Housing Conference, Novogradac & Co. (New Orleans)
- October 5: Annual Mississippi Affordable Housing Summit, Mississippi Association of Affordable Housing Providers (Jackson, Miss.)
- October 5-6: New Jersey Governor’s Conference on Housing and Economic Development (Atlantic City, N.J.)
- October 6: Annual NPH Affordable Housing Conference, Non-Profit Housing Association of Northern California (San Francisco)
- October 9-12: Intersections 2017, Grounded Solutions Network (Oakland, Calif.)
- October 11-13: NOW! Annual Conference, Housing Colorado (Vail, Colo.)
- October 12-13: Affordable Housing Finance, Development, and Policy Exchange, National Housing & Rehabilitation Association (Washington, D.C.)
- October 14-17: 2017 Annual Conference & Showplace, National Council of State Housing Agencies (Washington, D.C.)
- October 17: The NHP Foundation 2017 Symposium & Dinner, The NHP Foundation (Washington, D.C.)
- October 17-18: Annual Conference & Trade Show, New England Affordable Housing Management Association (Norwood, Mass.)
- October 19: Novogradac 2017 New Markets Tax Credit Fall Conference, Novogradac & Co. (Chicago)
- October 19-20: 2017 Fall Seminar—The Mature Section 8 Project, National Leased Housing Association (Washington, D.C.)
- October 23-26: ULI Fall Meeting, Urban Land Institute (Los Angeles)
- October 25: Transforming Communities with Affordable Housing, IPED (Austin, TX)
- October 25-26: 2017 North Carolina Affordable Housing Conference, North Carolina Housing Coalition (Raleigh, N.C.)
- October 26: 2017 NMCEH Sixth Annual Conference, Housing for All, New Mexico Coalition to End Homelessness (Albuquerque, N.M.)
- October 27-29: NAHRO National Conference & Exhibition, National Association of Housing and Redevelopment Officials (Pittsburgh)
- October 29-November 1: LeadingAge Annual Meeting & EXPO, LeadingAge (New Orleans)
- November 8-10: Greenbuild, The U.S. Green Building Council (Boston)
- November 8:10: 2017 Rural Housing Summit, California Coalition for Rural Housing (Pacific Grove, Calif.)
- November 14-16: AHF Live, The Affordable Housing Developers Summit (Chicago)
- November 15: Housing America’s Families Forum, J. Ronald Terwilliger Foundation for Housing America’s Families, Bipartisan Policy Center (Detroit)
- November 29: Solutions for Affordable Housing, National Housing Conference (Washington, D.C.)
- November 30: Novogradac 2017 Tax Credit Housing Finance Conference, Novogradac & Co. (Las Vegas)