Senators Patrick Leahy (D-VT), Susan Collins (R-ME), and Ron Wyden (D-OR), as well as eight of their Senate colleagues, introduced the “LIHTC Financing Enabling Long-term Investment in Neighborhood Excellence (LIFELINE) Act” (S. 4181) on May 12. The act would allow state, local, territorial, and tribal governments to use Coronavirus State and Local Fiscal Recovery Funds (SLFRF) to make long-term loans to affordable housing developments receiving Low-Income Housing Tax Credits (LIHTC). The bill is companion legislation to a bill (H.R. 7078) introduced in the U.S. House by Representatives Alma Adams (D-NC) and David Rouzer (R-NC) in March (see Memo, 3/21).
The NLIHC-supported LIFELINE Act would remove the statutory barriers that make it difficult for state and local governments to dedicate SLFRF dollars to LIHTC developments. Both the House and Senate versions of the LIFELINE Act would allow SLFRF to be used by LIHTC developments as a soft financing source to fill debts with loan maturities of 30 years or more and allow repayments on those loans to be used to finance affordable housing.
The Senate bill includes several provisions that are not in the House version:
- The bill clarifies that SLFRF loans are available only to LIHTC properties that will be put in service after the bill’s enactment.
- The bill requires project sponsors to waive the right to request a qualified contract as a condition of receiving a SLFRF loan and to agree to repay the loan if the project becomes non-compliant and no longer qualifies as affordable housing during its extended-use commitment period.
- The bill requires the U.S. Department of the Treasury to provide annual reports to several congressional committees on SLFRF obligations to LIHTC developments and the status of any repayments on SLFRF loans.
In February, more than 80 organizations joined an effort led by the National Council of State Housing Agencies (NCSHA) to urge Congress to allow SLFRF funds to be used for long-term loans to LIHTC developments. Ninety-seven local, state, and national organizations – including NLIHC – have endorsed the LIFELINE Act.
Read the House bill at: https://bit.ly/3u5odcr
Read a press release announcing the legislation at: https://bit.ly/3FGk1Fk