December 8, 2015
Here is the rundown of the state of play for the unfinished business of the 1st session of the 114th Congress.
1. The House and Senate are in session this week and they have a lot to accomplish before adjourning for the year, including an FY2016 Omnibus Appropriations bill and a $800 billion tax “extenders” bill to extend or make permanent around 50 temporary tax provisions. The House will also take up the Senate-amended version of a bill to repeal a number of the core provisions of Obamacare. The House has voted many times to repeal Obamacare, but this is the first time – using the special budget reconciliation process – that a bill has passed the Senate and will likely force President Obama’s veto. The Obamacare repeal bill also contains language to defund Planned Parenthood.
2. Last night House Ways and Means Chairman Kevin Brady introduced Tax Increase Prevention and Real Estate Investment Act of 2015. The bill extends all expired tax credit provisions including NMTC ($3.5 billion in annual credit authority) for 2015-2016. The bill is proposed as an amendment to HR 34, legislation dealing technical tax issues. This bill is seen as a backup measure should negotiations fail on the larger $800 billion tax bill. Throughout the day yesterday we were hearing two things: that the negotiations on a larger tax bill had not gone well over the weekend and that there increasing interest in Congress in adjourning for the year as soon as this weekend. With little time and limited progress, talk of a two year straight extension increased. Even as the two year package is introduced, discussions on a broader tax agreement continue. House Democrats in particular continue to pursue measures that assist low and moderate income families and resist a business only tax extender bill. The bill as introduced will allow for an additional $3.5 Billion authorized allocation of New Markets Tax Credits retroactively for calendar year 2015 and 2016. As introduced, the measure includes the 9 percent fixed credit rate for substantial rehab but does not include the 4 percent rate for acquisitions which the Senate has already passed. Brady’s legislation also includes extensions of other provisions important to community development, including an extension of qualified zone academy bonds, and an extension of expired Empowerment Zone provisions. The bill also notably includes an extension of the production tax credit (PTC) for wind and certain other renewable sources of electricity. Right now Ways and Means committee staff continue to work on a final package.
3. House Appropriations Chair Hal Rogers’ (R-KY) was expected to release the text of the FY2016 Omnibus Appropriations bill yesterday, which would combine the 12 un-enacted FY2016 appropriations bill into one bill, although however the day came and went primarily in part to the continued disagreements over the controversial policy riders that Congress wants to add to the bill. On December 2nd , the White House announced that President Obama would not be willing to sign a short-term continuing resolution that lasts longer than one or two days to allow more time for negotiations on the bill, if lawmakers miss the December 11 deadline – which may necessitate a federal government shutdown at the end of this week. House Speaker Paul Ryan expressed doubt that Congress can finish its business this week, saying work on renewing expiring tax breaks and funding the government might stretch later into December. The Wisconsin Republican, speaking on 1380 AM in Janesville, Wis., said “it might take us more than just this week together these issues put together correctly.” Needless to say Congress could be in for a long weekend ahead of them.
Here are some of the riders provoking controversy: (1) block the EPA’s recent carbon and greenhouse gas emission regulations; (2) no money for President Obama’s $3 billion Paris pledge to the United Nations’ Green Climate Fund; (3) impose a moratorium on allowing Syrian and Iraqi refugees to enter the United States until certain security benchmarks are met; (4) lift campaign finance restrictions on coordination between parties and individual candidate campaigns, the so-called “Dump Trump” provision; (5) allow health care providers a “conscience clause” to object to providing certain services that go against their religion; (6) block a Labor Department rule to require retirement investment advisers to work solely in the interest of the clients; and (7) freeze a rule requiring for-profit schools to show that a certain percentage of their students are gainfully employed in a recognized occupation in order to remain eligible for federal student aid.
4. On Friday, December 4, which also happened to be the deadline for enacting the bill, President Obama signed the $305 billion surface transportation bill, known as the FAST Act, which will immediately inject billions of dollars into the nation’s highway, transit, and rail infrastructure. This is the first 5-year bill surface transportation authorization enacted since 2005.
What should we do? Call Your Members of Congress to include the both the 9 and 4 percent Housing Credit Rates!
Contact your members of Congress right away – especially those who already have committed to supporting minimum Housing Credit rates by cosponsoring either H.R. 1142 or S. 1193. See a state-by-state list of minimum Housing Credit rate legislation cosponsors.
Ask your members of Congress to reach out to House Ways and Means Committee, Senate Finance Committee and House and Senate leadership, and tell them that both the minimum 9 and 4 percent Housing Credit rates must be included in the FINAL tax extenders package and continue to urge that the rates be made permanent.
- Minimum 9 and 4 percent Housing Credit rates should be extended permanently. Minimum Housing Credit rates must be extended for at least two years in order to have any practical benefit. A retroactive extension of minimum credit rates for 2015 only would not benefit developments for which the credits have already been awarded.
- Minimum Housing Credit rates make the development of affordable housing more predictable and financially feasible. With the ‘floating rate’ in effect, there is 15 – 20 percent less Housing Credit equity available for any given affordable housing development, creating financing gaps that are increasingly difficult to fill. Use our new Housing Credit rate fact sheet to help explain the need for minimum Housing Credit rates.
- Minimum Housing Credit rates provide significant benefit for minimal cost. The Joint Committee on Taxation estimates that the minimum 9 and 4 percent rate extensions included in the Senate Finance Committee-passed tax extenders legislation would cost only $5 million over 10 years.
- Minimum Housing Credit rates have strong bipartisan support. The minimum Housing Credit rate legislation in the Senate, S. 1193, has 29 co-sponsors, including 7 members of the Senate Finance Committee. The companion legislation in the House, H.R. 1142, has 77 co-sponsors, including 28 members of the Ways and Means Committee. The Senate Finance Committee also approved its extension of minimum 9 and 4 percent rates with bipartisan support.
- Permanently extending minimum credit rates will ultimately benefit low-income families. The White House maintains that if any tax extenders are made permanent, some of them must benefit lower- and middle-income families.
- The Housing Credit benefits urban, suburban and rural communities in every state. Use the state and district fact sheets to show the impact of the Housing Credit locally.
Call Your Members of Congress to Support the extension and enhancement of the New Markets Tax Credit Program
Ask your members of Congress to reach out to House Ways and Means Committee, Senate Finance Committee and House and Senate leadership, and tell them that the New Markets Tax Credit supports economic growth and investment across the country. As deliberations on a major tax bill continue, our message continues to be that the New Markets Tax Credit should become a permanent part of the tax code and should grow based on its demonstrated success.
There is no final word yet, however given the timing of the introduction and the Congressional sprint to the finish line, assembling and passing a larger more complicated tax bill seems challenging. We shall not give up as some Members are still working on a large package and the New Markets Tax Credit Coalition is working to include the Senate provision on NMTC – described below – into the bill. Now is the time to support this effort.
Senate Finance Committee Bill (S.1946) -Extension and modification of new markets tax credit:
The bill extends the New Markets Tax Credit (NMTC) for two years. In addition, the bill modifies the NMTC to provide a one-time increase in NMTC allocation authority so that $3.94 billion in allocation authority is available in 2015 and 2016. This provision is estimated to cost $2.076 billion over 10 years.
Reasons for Change (Senate Finance Committee Report):
The Committee believes that the new markets tax credit has proven to be an effective means of providing equity and other investments to benefit businesses in low income communities, and that it is appropriate to provide for the allocation of additional tax credit authority for another two calendar years. The Committee also believes that it is appropriate to provide for a one-time adjustment to the credit limitation (by the rate of inflation from 2008 through 2014) in order to partially offset allocation erosion due to inflation.
For more information, contact NDC Washington Office at 202-400-3680 or email@example.com.