Senate GOP Tax Reform Bill Retains the Housing Credit, Housing Bonds and NMTC
Yesterday Senate Finance Committee Chairman Orrin Hatch (R-UT) introduced the Senate’s version of the “Tax Cuts and Jobs Act,” with significant improvements from the House’s version released last week. The legislation would:
- Retain the Low-Income Housing Tax Credit (Housing Credit).
- Retain private activity bonds, including multifamily Housing Bonds, which provide critical financing to more than half of all Housing Credit developments.
- Retain the New Markets Tax Credit (NMTC) through 2019 as currently authorized.
- Retain the historic rehabilitation credit but with a reduction.
- Lower the corporate tax rate from 35 to 20 percent. The bill does not make any adjustments to sustain Housing Credit investment in light of the lower corporate rate.
Enterprise thanks Senate Republican leadership for rejecting the proposals from the House’s tax reform bill that would devastate affordable housing and community development, and asks for their continued support as this process progresses. We also call on the Senate to make adjustments to the Housing Credit to offset the impact of the lower corporate rate on Housing Credit investment.
House Advances Tax Reform Bill Without Needed Improvements
Yesterday the House Ways and Means Committee also advanced its version of the Tax Cuts and Jobs Act on a party-line vote. The House version of the bill would also retain the Housing Credit with no adjustments, but would devastate affordable housing production by eliminating the tax exemption on private activity bonds, including multifamily Housing Bonds, and would significantly limit our ability to revitalize distressed communities by repealing the NMTC.
While some changes to the bill were made during mark-up, none would reverse the bill’s harmful impacts on affordable housing – an estimated reduction of nearly one million affordable homes over the next decade – or community development. Changes may still be made to the House bill before it is sent to the House floor for a vote, and the House Republican conference will be meeting on Monday to discuss potential changes, providing an opportunity to influence the bill before it goes to the floor next week.
Reach out to Republican Senators to:
- Thank them for retaining Housing Bonds and the NMTC, and ask for their continued support throughout the tax reform process.
- Ask that they convey support to Chairman Hatch for offsetting the impact of a lower corporate rate on the Housing Credit.
Reach out to Republican Representatives to:
- Ask that they convey support to Speaker Ryan and Chairman Brady for:
- Restoring multifamily Housing Bonds,
- Offsetting the impact of a lower corporate rate on the Housing Credit, and
- Restoring the NMTC.