The National Association of Counties (NACo), the National League of Cities (NLC), and the Oregon Housing and Community Services Department (OHCS) have joined an effort to promote federal legislation expanding a powerful tool local governments can use to help finance affordable housing developments.
Local governments have been increasingly turning to Private Activity Bonds (PABs) to boost affordable housing construction and alleviate the affordable housing crisis. PABs are a type of municipal “conduit” bond that local governments can leverage to fund construction of buildings, infrastructure, or amenities that provide some public benefit but which are privately owned.
Governments who issue PABs aren’t borrowing any money – the debt is carried by the project developer, who enjoys a favorable interest rate as a result of the federal tax break on investors’ PAB income. Since PABs cost the feds in the form of lost income taxes, states are subject to PAB caps. With the growing popularity of PABs in Oregon, the caps have started to seriously constrain the ambitions of Oregon local governments. As the affordable housing crisis continues, local governments need all the tools they can get to address the problem. The Affordable Housing Credit Improvement Act (AHCIA) of 2023 (AHCIA, S. 1557 & H.R. 3238) would increase the cap on PABs, empowering local governments to get more public benefit projects built.
Call to Action!
Local government leaders are being invited to sign on to a letter supporting the AHCIA.
[Click here to view the letter supporting the AHCIA]
[Click here to sign on to the letter supporting AHCIA]
The deadline for local elected officials to sign on is September 7.
The ACTION Campaign is the main advocacy arm of this effort, and they’ve partner with the National League of Cities, National Association of Counties and the Mayors and CEOs for U.S. Housing Investment to circulate a sign-on letter from local elected officials—specifically, mayors, county executives, and county board chairs—to congressional leadership in support of the AHCIA.
Contributed by: Michael Burdick | Legislative Affairs Manager