Several important steps have been taken at both the federal and states levels to further advance affordable housing and alleviate the stressors impacting the industry over the last 15 months. A few recent highlights over the last month include actions by Congress and the State of Illinois.
United States Congress
The Senate passed a bipartisan infrastructure bill by a vote of 69-30 on August 10, 2021. A traditional infrastructure plan, the Infrastructure Investment and Jobs Act will put $1 trillion toward modernizing and upgrading water systems, bridges, roads, and broadband and utilities.
Of importance to the affordable housing industry, the passage of this bill sets the stage for movement in the Senate on its $3.5 trillion FY 2022 budget resolution. It should be noted that this bill will likely only be advanced through budget reconciliation, which allows it to be passed by a simple majority rather than needing the 60 votes to avoid a filibuster. The House does not prepare to vote on either of these bills until they’ve both passed the Senate, but it is within the Senate budget resolution that the affordable housing industry will find important policy changes and fixes, many of which could be found in the Affordable Housing Credit Improvement Act (AHCIA).
The following provisions were included in the most recent AHCIA:
- Reducing the bond threshold from 50% to 25% (Novogradac estimates that over the next decade this modification alone may lead to the financing of an additional 1.5 million affordable homes).
- Phasing in a 50% increase in the allocation of housing credits over two years rather than five.
State of Illinois
An affordable housing omnibus package was signed into law by the governor on July 29, 2021. This bill includes several important provisions. One critically important provision was the creation of a $75 million gap financing program for LIHTC developments. Funding for this program comes from the American Rescue Plan Act (ARPA) and will help LIHTC deals pay for development costs at a time in which they have increased significantly. Another important provision in this bill doubles the bonding authority of the Illinois Housing Development Authority (IHDA) from $3.6-billion to $7.2-billion
Hooker DeJong, Inc. (HDJ) is a leading national design firm providing architectural and engineering expertise to support the affordable housing industry throughout the United States. HDJ’s diverse portfolio includes successful outcomes with adaptive reuse renovation, acquisition rehab, new construction, historic preservation, and RAD.