Significant legislation was introduced in the Senate today by Sen. Ron Wyden, D-Oregon. The Decent, Affordable, Safe Housing for All (“DASH”) Act proposes dramatic changes that could move the needle on affordable housing to the tune of nearly two million homes. The main features of the act are to expand the availability and impact of Low Income Housing Tax Credits as follows:
Lowering the 50% Test: Presently, if a developer finances 50% or more of a project with tax-exempt private activity bonds (“PABs”), the project owner can claim tax credits without impacting the issuing agency’s LIHTC volume cap. Sen. Wyden proposes that the minimum be reduced to 25% to free up funds for more affordable housing projects.
Boost for Extremely Low Income (“ELI”): The act provides up to a 50% cost basis boost for projects that have at least 20% ELI households.
More 9% LIHTC Allocations: The 9% low income housing tax credit is the primary tool of multifamily affordable housing nationwide, but they are in short supply – a certain amount is allocated annually to each state based on population, and it’s never enough. DASH calls for a temporary 12.5% increase in the allocation.
