Senators Patrick Leahy and Susan Collins introduce LIFELINE ACT

On May 11, 2022, Senators Patrick Leahy (D-VT) and Susan Collins (R-ME) introduced S. 4181, the LIHTC Financing Enabling Long-term Investment in Neighborhood Excellence (LIFELINE) Act. The bill would allow state, local, territorial, and tribal governments to use Coronavirus State and Local Fiscal Recovery Funds (SLFRF) to make long-term loans to LIHTC developments. Nine additional Senators joined as original cosponsors, including Senator Ron Wyden (D-OR), Chairman of the Finance Committee (which has jurisdiction over the bill).

As a condition for accepting SLFRF loans, S. 4181 requires that project sponsors waive any right to request a qualified contract and requires them to repay the loan if the project becomes noncompliant. The legislation clarifies that SLFRF can only be used for LIHTC properties placed in service after the legislation’s date of enactment. The bill also requires the Treasury Department to provide annual reports to Congress regarding SLFRF obligations to LIHTC developments and the status of any repayment on SLFRF loans.

Representatives Alma Adams (D-NC) and David Rouzer (R-NC) introduced similar companion legislation (H.R. 7078) on March 15, 2022, and have been strong advocates for their legislation. On May 12, 2022, Rep. Adams raised affordable housing issues with Treasury Secretary Janet Yellen during a hearing before the House Financial Services Committee. She noted the introduction of her bill and urged her colleagues to cosponsor it. Secretary Yellen discussed the shortage of affordable housing and noted that the Administration urged states and localities to use SLFRFs to expand affordable housing.

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