House Ways & Means Committee Hearing on Infrastructure Stresses Importance of Housing Credit; House Democrats Release $760 Billion Infrastructure Framework
Last month, the House Ways and Means Committee held the hearing, “Paving the Way for Funding and Financing Infrastructure Investments.” At the hearing, a number of Ways and Means Committee members voiced strong support for the Housing Credit, including Chairman Richard Neal (D-MA-01) and Representatives Suzan DelBene (D-WA-01), Dwight Evans (D-PA-03) and Stephanie Murphy (D-FL-07). The ACTION Campaign released a statement ahead of the hearing urging committee members to ensure that any infrastructure bill includes a housing title, and that the housing title make central the Affordable Housing Credit Improvement Act (AHCIA). It highlights the important role that the Low-Income Housing Tax Credit (Housing Credit) plays in combating the affordable housing infrastructure deficit across the country, stressing that safe, affordable housing is a vital part of our nation’s infrastructure.
Representative DelBene, lead cosponsor of the AHCIA, submitted ACTION’s statement in support of the Housing Credit to the record. She stated: “Safe and affordable housing is a critical part of our nation’s infrastructure, and like roads and bridges, affordable housing is really a long-term economic development asset.” Chairman Neal also made a strong case for the Housing Credit: “We need to remember that when we invest in infrastructure, we need to do so fairly. Infrastructure is not only about financing public projects, but it is also about encouraging economic development and revitalizing struggling communities. We must continue to reinvest in both urban and rural neighborhoods through successful programs like the Low-Income Housing Tax Credit, the New Markets Tax Credit, and indeed the Historic Tax Credit. I have been a longtime supporter of these initiatives because they have real, positive impacts on our communities.” Representative Evans, a cosponsor of the AHCIA, also stressed the importance of affordable housing, stating: “None of us are home until all of us are home.” Representative Murphy, another AHCIA cosponsor, expressed the need for the Housing Credit in her district, stating: “My constituents…face the most severe affordable housing shortage in the country, yet another outcome of underfunded infrastructure in the United States.”
Witness Laura L. Canter, Executive Vice President and Division Director of the Finance Programs Division at the Massachusetts Development Finance Agency, explained how the 4 percent credit minimum, a provision of the AHCIA, is crucial to the success of the program. She stated, “The 4 percent credit is basically tied to the federal cost of borrowing…with interest rates being so low, it’s not 4 percent anymore, its much lower, it’s closer to 3. So, if we knew that 4 percent was the floor, [projects] wouldn’t have to wait and see what their credit would be depending on what interest rates are when projects close.” Witness Dr. Phillip Fischer of eBooleant Consulting LLC and Former Head of Fixed Income and Municipal Bond Strategy agreed that a 4 percent minimum would be beneficial, stating: “Increasing the certainty of the cash flows would reduce cost.” Ms. Canter concluded by stressing that “The [Housing] credit is well understood by the market. It’s a mature program… The only trouble with the program is there simply isn’t enough of it… The program itself works.”
That same day, House Democrats released a five-year, $760 billion infrastructure framework, titled “Moving Forward.” In addition to a heavy focus on transportation and clean energy, the plan identifies the expansion of existing tax credits as a key infrastructure need, including “housing investments incentivized by the low-income housing tax credit.” The more detailed infrastructure package is expected to be released in May. The ACTION Campaign will continue to advocate for any infrastructure proposals to include key provisions from the AHCIA.