It was a treat seeing all the posts on social media of friends and colleagues enjoying the summer months. Whether it was family travel, attending a concert or sporting event, various philanthropic feats of athleticism or getting kids ready for school, it was heartening to see the focus on family and friends while recharging our batteries.  

I must first note, with particular sadness, the passing of Representative Jackie Walorski (R-IN) and two of her staff in an automobile accident. Jackie was our House Republican champion for the AHCIA and a very strong supporter of affordable housing. She worked very closely with her House colleague Rep. Suzan DelBene (D-WA) and Senators Maria Cantwell (D-WA) Todd Young (R-IN) on our LIHTC agenda and was ready to lead the fight for more resources in the next Congress. The personal loss aside, it will be task replacing her advocacy on the Ways and Means Committee. 

While July and August can be quiet months on the legislative front, this was not the case this summer. The Senate finally passed a reconciliation package, the Inflation Reduction Act, provides incentives to promote energy security and address climate change, extends expanded Affordable Care Act premium subsidies, and reduces the deficit. The bill passed the Senate on August 7th by a party line vote of 51-50, with Vice President Kamala Harris casting the tie-breaking vote. The House returned from its recess on August 12th and passed the legislation by a party line vote of 220-207. President Biden signed the bill into law on August 16^th. 

The bill is primarily paid for by a new 15 percent minimum tax on adjusted book income of certain large corporations; an excise tax on stock buybacks; allowing Medicare to negotiate prescription drug prices; and by increasing funding for the Internal Revenue Service to improve tax compliance. Of particular note for our industry, the bill would allow corporations to use general business tax credits (including the LIHTC) to offset up to 75 percent of the combined regular and minimum tax. 

There are no provisions in the bill addressing LIHTC resources, but we are appreciative of the extraordinary efforts made by Senator Maria Cantwell (D-WA) and several of her Senate colleagues to advocate inclusion of our LIHTC agenda in the final bill. Senator Cantwell and I strategized regularly and included key Senators and staff in these discussions. It became clear very early in the conversations that Senators on both sides acknowledge the breath of the affordable housing crisis as well as the affect housing supply is having on inflation. This narrative and the outreach we had with Senate leadership give me much confidence we will get some of our agenda addressed in the end-of-year legislative scrum.  

August 5^th was the deadline for interested parties to submit their comments to the federal regulators looking to institute new rules for the Community Reinvestment Act. The Housing Advisory Group, as well as many of our colleague organizations, submitted comments and we now look forward to working with the regulators on revised rules that will augment the investment in and production of affordable housing. 

We have also kept the pressure on our friends at Treasury and the IRS to release the proposed regulations for the Average Income Test, expected by September 30^th, as well as address the industry’s request to extended Place in Service (PIS) deadlines. I have worked directly with House and Senate tax staff and Members to seek expeditious release of these regulatory changes and their counterparts at Treasury have been accommodating of these requests. We have been told the staff at Treasury is working as expeditiously as possible on these and other proposed regs and are simply overwhelmed. We remain guardedly confident the AIT revised regulation will be released prior to 9/30. 

We are also working on the FY2023 budget, which is due by September 30^th. It is unlikely the House and Senate will come to an agreement by then and they will, as is usually the case, pass a continuing resolution (CR) to get them into the Fall where negotiations will continue. The House and Senate THUD subcommittees have both proposed significant increases in the HUD budget so we look forward to seeing how negotiations proceed.  

Looking ahead, the industry will begin to work on the next version of the Affordable Housing Credit Improvement Act (AHCIA) while working on the end of year legislative play and what we might get done before 12/31/22. We encourage you and your colleagues around the country to weigh in with comments on the 2023 agenda and what we might want to consider including in our consensus housing bill (AHCIA).  

I thank you all for your continued advocacy and support. We will likely need your assistance later this year when tax extenders and what might be possible comes more into focus. Until then, be well and keep up the good fight.