On April 8, 2025, the federal Affordable Housing Credit Improvement Act (“AHCIA”) was reintroduced in the House with 117 bipartisan co-sponsors from over 30 different states. The bill would expand the Low-Income Housing Tax Credit (“Housing Credit”), our nation’s most successful affordable housing program. AHCIA was first introduced in 2016 and has gained more and more support with each introduction over the past five congresses. It is intended to help finance 1.6 million more affordable rental units over the next decade. A companion bill is expected to be introduced in the Senate soon.
Some of the key provisions of AHCIA include:
- Expand the 9% Housing Credit by restoring the 12.5% cap increase that expired in 2021, and further increase the number of Housing Credits allocated to each state by 50% for the next two years.
- Streamline the election of “Average Income Test” for Bond-financed Housing Credit developments.
- Allow states to maximize production of housing projects built using private activity bonds by reducing the amount of private activity needed to secure Housing Credits from 50% to 25%.
- Provide further flexibility for existing tenants’ income eligibility.
- Basis increases for rural developments, Tribal communities and extremely low-income tenants.
- Make the Housing Credit compatible with energy tax incentives by eliminating basis reductions requirements.
Harris Beach’s Affordable Housing team is monitoring this development and related matters. For further details on how this proposed legislation might impact your projects, or if you have questions for our housing lawyers, please reach out to attorney Michael A. Discenza at (212) 912-3605 and mdiscenza@harrisbeachmurtha.com; attorney Linnea Spagnoletti at (585) 419-8623 and lspagnoletti@harrisbeachmurtha.com; attorney Melanie C. Marotto at (716) 200-5230 and mmarotto@harrisbeachmurtha.com; attorney Charles (Chip) W. Russell at (585) 419-8635 and crussell@harrisbeachmurtha.com; attorney Tyler W. Stark at (585) 419-8961 and tstark@harrisbeachmurtha.com; or the Harris Beach attorney with whom you most frequently work.
This alert does not purport to be a substitute for advice of counsel on specific matters.
Harris Beach Murtha’s lawyers and consultants practice from offices throughout Connecticut in Bantam, Hartford, New Haven and Stamford; New York state in Albany, Binghamton, Buffalo, Ithaca, New York City, Niagara Falls, Rochester, Saratoga Springs, Syracuse, Long Island and White Plains, as well as in Boston, Massachusetts, and Newark, New Jersey.
