Join the ACTION Campaign Monthly Call on Friday, June 5
The ACTION Campaign monthly call will be held on Friday, June 5 at 2:00 pm EST. Call-in information:
- Phone number: 929-205-6099
- Meeting ID: 193 634 880
- Password: 256387
House Passes HEROES Act, ACTION Advocacy Strategy to Focus on Senate
On May 15, the House passed the HEROES Act, H.R. 6800. Though the bill does include some investments in affordable housing and community development, it does not include ACTION’s proposals for immediate relief for the Low-Income Housing Tax Credit (Housing Credit) program. Read ACTION’s recent update to learn more about the HEROES Act.
The Senate has not seriously considered the HEROES Act as it stands, and instead is likely to draft its own version of the legislation, which would then serve as the Senate’s starting point for negotiations with the House. Timing and scope of a potential Senate bill is still uncertain.
As the Senate considers its version of the next COVID-19 relief bill, we encourage advocates to reach out to their Senators and urge them to tell their leadership to include in it a minimum 4 percent Housing Credit. We will continue to work for the advancement of all of ACTION’s Housing Credit proposals, though we are specifically highlighting the need to enact a minimum 4 percent Housing Credit rate because COVID-19 has caused federally borrowing rates to dip severely, resulting in the record low credit rate. Advocates should also continue to engage their Representatives on the need to advance ACTION’s Housing Credit priorities.
Please use these ACTION advocacy materials in your outreach to Congressional offices:
- The ACTION Campaign has released updated 4 percent Housing Credit fact sheets for advocates to use to demonstrate to Members of Congress how critical the 4 percent Housing Credit rate is for affordable housing in different states across the country.
- In a May 6 ACTION sign-on letter, 2,354 organizations have called on Members of Congress to include ACTION’s Housing Credit proposals in the next COVID-19 response package.
67 Mayors Sign-On to Bipartisan Letter Urging Congress to Include Housing Credit Provisions in Next COVID-19 Response Legislation
In a June 1 bipartisan letter to Congress, 67 mayors across the country have called for the inclusion of our Housing Credit priorities in the next COVID-19 response bill. The letter, which was circulated by the Seattle Office of the Mayor and the ACTION Campaign, urges Members of Congress to advance ACTION’s proposals for immediate Housing Credit relief: the enactment of a minimum 4 percent Housing Credit rate and the lowering of the “50 percent test” bond financing threshold for 4 percent Housing Credit developments. The mayors cite the urgent need for affordable rental housing in their cities, particularly in light of the economic downturn in the face of COVID-19, and highlight these proposals as immediate solutions to include in the next round of response legislation.
OCC Releases Final Rule to Modernize CRA
On May 20, the Office of the Comptroller of the Currency (OCC) released its final rule to modernize the Community Reinvestment Act (CRA) regulations. CRA requirements ensure banks invest in low- and moderate-income (LMI) communities. Approximately 85 percent of the annual Housing Credit equity investment is CRA-driven. The OCC had released a proposed rule late last year alongside the Federal Deposit Insurance Corporation (FDIC); however, the final rule was released by the OCC alone. In April, the ACTION Campaign Steering Committee submitted comments citing a number of concerns with the proposed rule.
Several elements of the proposed rule that the ACTION Campaign Steering Committee and many Housing Credit partners had identified as concerning remained unchanged. The final rule eliminates the investment test and replaces the current three-part test with an overall ratio and community development minimum. The OCC also adopted its expansive list of qualifying activities for CRA credit in the community development category as proposed.
The ACTION Campaign Steering Committee also raised concerns about the proposed rule’s intent to double weight Housing Credit investments and other activities with the use of a multiplier. However, in the final rule, a bank would only be eligible for the multipliers if the dollar value of its current period community development activities is approximately equal to or exceeds the dollar value of community development activities in its prior evaluation period.
The ACTION Campaign will continue to analyze the details of the OCC’s CRA final rule, and will monitor any further rulemaking, related developments, and its implementation. The OCC’s final rule will only impact OCC banks, not FDIC or Federal Reserve banks. For OCC banks, compliance with the final rule will be required in 2023 for larger banks and 2024 for smaller banks. OCC Comptroller Joseph Otting stepped down on May 29, and First Deputy Comptroller and Chief Operating Officer Brian P. Brooks will serve as Acting Comptroller of the Currency.
In Case You Missed It
- On May 22, Senate Finance Committee Ranking Member Ron Wyden (D-OR) released an outline of affordable housing credit priorities he will pursue in the next COVID-19 response bill, which includes ACTION’s priorities.
- A recent Novogradac analysis estimates that the enactment of a minimum 4 percent Housing Credit rate – one of ACTION’s key priorities for immediate COVID-19 relief – could finance nearly 126,000 additional affordable rental homes over 2020-2029.
- On May 15, NCSHA and Novogradac published an analysis showing the effect of lowering the 50 percent test for bond-financed Housing Credit developments – another of ACTION’s priorities for immediate COVID-19 relief – which projects that lowering the bond financing threshold would result in the production of additional affordable Housing Credit units.