Rep. Randy Hultgren (R-IL-14) is sending a letter to House and Senate leadership opposing the proposed elimination of tax-exempt private activity bonds in the House’s tax reform bill, focusing on the need for private activity bonds (PABs) to support investments in our nation’s infrastructure and affordable housing for low- to moderate-income families. According to Novogradac & Co., the proposed elimination of PABs, which includes multifamily Housing Bonds, would result in a loss of roughly 788,000 to 881,000 affordable rental homes over the next decade, a devastating impact on affordable housing production. Additionally, projects financed through HUD’s Rental Assistance Demonstration (RAD) – an initiative that allows public housing authorities (PHAs) to convert public housing into public-private partnerships using Section 8 contracts – often rely on the Housing Credit and Housing Bonds to finance conversions. Over half of the currently pending RAD projects are planning to use Housing Bonds and the 4 percent Housing Credits that they trigger; without the tax-exemption on multifamily Housing Bonds, these RAD conversions would simply not be possible.
While the Senate version of the tax reform bill would retain private activity bonds, their inclusion in any final tax bill requires continued advocacy. Read more about private activity bonds on the Enterprise blog, see the ACTION Campaign’s talking points on Housing Bonds and visit the ACTION Campaign’s Advocacy Toolkit for more resources to support the Housing Credit and Housing Bonds.