As we enjoy these last weeks of summer, we thought it might be good timing to give a lay of the land and prepare you for what may lie ahead. If you have enjoyed the rollercoaster we have been on since after the election, you are in luck. It is likely to get more exciting once Congress returns in September.
Let’s start close to home with our efforts to expand the LIHTC. Both the Senate bill, S. 548, and the House bill, H.R. 1661, continue to build strong bipartisan support with a boost coming from the August 1st Finance Committee hearing, America’s Affordable Housing Crisis: Challenges and Solutions, chaired by our lead Republican sponsor, Senator Orrin Hatch (R-UT). In the aftermath of that positive hearing, we are hoping to bring on board some key Republican Senators, and are working with our industry friends and HAG members in those states to do so. The Senators we are particularly focusing on to cosponsor S. 548 are John Cornyn (TX), Tim Scott (SC), John Thune (SD), Cory Gardner (CO), Bill Cassidy (LA), and John Kennedy (LA).
Despite its allure to Members of Congress and the Administration, tax reform remains up in the air. Lack of consensus around specific issues, tax rate targets, and even what would qualify as "reform" may in the end once again make true reform a bridge too far. We have long pointed out that exercises of this magnitude have only succeeded when all parties have been at the table and the goal has been a consensus, bipartisan product. This certainly has proven true with respect to the failure (so far) to enact health care reform or to pass the FY 2018 budget. And then there is the legislative clock, which is winding down toward 2018 and the mid-term elections. We still see hope for something to be accomplished as Finance Committee Chairman Orrin Hatch has indicated his plans for full committee hearings on tax reform proposals. Committee members on both sides of the aisle have told us they see common ground with their colleagues on the other side on a number of issues and hope they are allowed to explore those areas and come up with a bipartisan proposal. Whether the leadership will allow them this opportunity remains to be seen.
The final issue we will touch on, and which could be a significant obstacle to any legislative success in the fall, is the debt ceiling. This has traditionally been a bipartisan exercise of necessity with main-stream Republicans joining like-minded Democrats in raising the federal government’s borrowing limits to pay the nation’s bills. The Treasury Department has notified Congress that the end of September is when the government will run out of money to meet its obligations, but a consensus on a path forward has yet to be forged. The threat to passage this time around is the insistence by the House Freedom Caucus and other conservatives that controversial policy riders be included in the debt ceiling bill. This, and the lack of demonstrable bipartisanship thus far, could make the debt ceiling exercise another conflict Congress does not need, and one that could throw the rest of the fall agenda off the tracks.
And then there is North Korea.
So in closing, while we are pleased with our industry-wide efforts to promote and expand the LIHTC, it is going to be a rocky ride. Take your Dramamine and hold on.