Washington Update

Barbara Thompson and Garth Rieman, NCSHANational Conference of State Housing Boards

Educational & Development WorkshopAugust 17, 2015

NCSHA Legislative and Regulatory Priorities

• Protect and strengthen Housing Bonds and the Housing Credit

• Seek adequate funding for HOME, Section 8, the Housing Trust Fund, and rural housing programs

• Pursue housing finance reform that supports affordable housing and a strong HFA role

• Maintain HFAs’ ability to offer down payment assistance programs with Federal Housing Administration (FHA)-insured mortgages

Tax Legislation

• Tax reform momentum has waned considerably.

• Congress is now pursuing only limited international and corporate tax changes.

• Congress also is working on extending expired tax provisions before the end of the year.

Tax Legislation• The Senate Finance Committee on July 21

passed legislation extending expired tax provisions for two years; it includes minimum Credit rates for the 9 percent and 4 percent acquisition Credit programs.

• The House Ways and Means Committee has passed several bills making individual expired provisions permanent, but not the Credit provisions; Chairman Paul Ryan (R-WI) expects the Committee to consider extenders this fall.

Tax Legislation• House members Pat Tiberi (R-OH) and

Richard Neal (D-MA) and Senators Pat Roberts (R-KS) and Maria Cantwell (D-WA) have introduced legislation making permanent the 9 percent and 4 percent acquisition Credit rate floors.

• The House bill, H.R. 1142, has 65 cosponsors.• The Senate bill, S. 1193, has 28 cosponsors.• NCSHA and the ACTION Campaign are also

seeking a Credit authority increase and other Credit and Bond improvements.

Appropriations Activity• The overall government funding situation is

very tight because of Budget Control Act limits on total discretionary spending.

• The House and Senate appropriations committees have passed legislation funding HUD and rural housing programs in Fiscal Year 2016.

• These bills are unlikely to advance before congressional leaders and the Administration enter into negotiations over government spending limits.

Appropriations Activity• The House and Senate bills maintain most

HUD and rural housing programs at close to current spending levels.

• However, the Senate Committee-passed bill would cut the HOME program by 93 percent.

• The House Committee-passed bill appropriates $767 million for HOME, but would transfer the estimated $133 million Fannie Mae and Freddie Mac will contribute to the Housing Trust Fund to HOME to maintain its funding at $900 million.

Housing Finance Reform• The House, Senate, and Administration

continue to prefer significantly different approaches.

• No major legislation has been introduced in this Congress.

• Fannie Mae and Freddie Mac continue to generate substantial revenue for the U.S. Treasury.

• Significant legislative activity during this Congress is unlikely.

HFA Down Payment Assistance Programs

• HFA down payment assistance programs are key to HFA mortgage programs.

• The HUD Inspector General (IG) recently released a report expressing concerns with local HFA DPA programs in Arizona.

• The HUD FHA program office is reviewing the report and discussing it with the IG.

• FHA released a statement in July expressing support for state HFA programs.

GAO Housing Credit Studies

• The Government Accountability Office (GAO) released a study on federal oversight of the Housing Credit in July.

• GAO is conducting two more studies of the Housing Credit program.

• The second study will focus on state administration of the program and will likely be issued this fall.

• The third study, expected in the spring, will focus on development costs and the role of syndicators.

Questions?