Last week, the House Ways and Means Committee passed a key piece of infrastructure legislation that will expand and improve a number of community development incentives. Historic Tax Credit provisions, similar to the House version of the Historic Tax Credit Growth and Opportunity Act (HTC-GO/H.R. 2294), were included in the legislation and passed out of committee on a vote of 24 to 19.
Despite strong support in the House, the Biden Administration is currently negotiating with House and Senate leadership to reduce the cost and scope of the bill. All historic tax credit provisions are in jeopardy of reduction or elimination. HTC advocates’ outreach to Democratic Senators will directly determine how much support HTC provisions will receive from Senate Democrats, who are in control of the present phase of negotiations.
The following HTC provisions were included in the bill passed out of the Ways and Means Committee.
Rehabilitation Tax Credit
- Sec. 135301. Temporarily Increasing the HTC From 20% to 30% for all projects.
- Sec. 135302. Permanent increase in the rehabilitation credit for small projects.
- Sec. 135303. Modification of substantial rehabilitation definition.
- Sec. 135304. Elimination of basis adjustment.
- Sec. 135305. Modifications of tax-exempt use leasing rules.
- Sec. 135306. Enabling HTC to be used for public school buildings.
To read the full text of the section-by-section breakdown of the infrastructure bill, Click Here (HTC on Pages 3 and 4).
Next in the legislative process, this bill must move through the reconciliation process in the House, pass the House, pass the Senate, and be signed into law. Washington insiders believe that a final bill will be negotiated with the Senate before it goes to the House floor.
The budget reconciliation bill will be a partisan exercise of Democratic priorities and is unlikely to receive any Republican votes in the House or the Senate. Both the House and Senate have very small Democratic majorities. As the debate moves forward, the package may be significantly smaller, and advocates for all issues will have to work hard collectively to fend off threats to reduce or eliminate their priorities. The HTC provisions are no different.
As Democratic Leadership continues to negotiate the bill, please join HTC advocates in reaching out to Democratic Senate Members to voice support for these enhancements. Share the benefits these provisions will bring to your community.
Take Action
Constituents of Democratic Senators should review the House section by section breakdown of the bill (HTC Page 3 and 4) and ask their legislator to support the Historic Tax Credit enhancement provisions included in the infrastructure legislation. To locate the names, phone numbers, and websites of your Senators, go to: https://www.senate.gov/senators/contact
- Send a message to your Democratic Senators through their website and select “tax” or “taxation” as the issue area, or call the offices of your Senators. Introduce yourself as a constituent and ask for the email address of tax staff.
Ask/Explain to your Democratic Senators:
- Introduce yourself as a constituent.
- “Thank you for your previous support of the Historic Tax Credit. Provisions to enhance the Historic Tax Credit have been included in the House infrastructure budget reconciliation bill. These provisions are similar to the provisions of the Historic Tax Credit Growth and Opportunity Act (H.R. 2294/S. 2266), which would greatly benefit our community. Please continue to support and protect these provisions as the bill moves forward.”
- Explain how enacting these provisions would benefit your community.
- Feel free to share the bill’s Section-by-Section Breakdown (HTC provisions on Pages 3 and 4) or copy and paste the HTC provisions in your message.
Other Resources
HTC State Maps and Project Lists FY2002-2020
Thank you for your advocacy! Please share responses from Senate offices and gain assistance with your advocacy by emailing: Mike Phillips, Shaw Sprague, and Patrick Robertson.
Background
In August, the Senate passed two bills, representing the first critical steps in President Biden’s signature economic recovery initiative. With the razor-thin majority, President Biden and Democratic Senate leaders worked to secure agreements for these measures in the Senate. Moderate Senate Republicans have agreed to a $1.2 trillion bill which contains $600 billion in new spending to fund roads, bridges, transit, and freight rail, as well as electric vehicle transit and other infrastructure priorities. The bill passed the Senate on a 69 to 30 vote. The Senate also passed a $3.5 trillion budget “blueprint” on a 50 to 49 party-line vote that will be the vehicle to fund Democratic community development, health care, and other “human” infrastructure priorities this fall.
The House adopted the Senate’s budget resolution in late August. In mid-September, House Democratic-led committees approved a more detailed $3.5 trillion package of bills, building upon the blueprint passed in August with HTC enhancements similar to HTC-GO (H.R. 2294).
House and Senate leadership is presently negotiating reductions in the total size and scope of the bill, though the timeline is becoming increasingly challenging. House Speaker Nancy Pelosi is striving to pass both the $1.2 trillion bipartisan infrastructure bill of roads, bridges, transit, and broadband (likely gaining support from House Democrats and Republicans), as well as the partisan driven budget reconciliation bill in September. Washington insiders believe that a final bill will be negotiated with the Senate before it goes to the House floor.
Once passed by the House, the budget reconciliation bill with Democratic priorities will be sent to the Senate for a vote under budget reconciliation by a simple 51-vote majority (or 50 votes plus Vice President Kamala Harris breaking the tie), which cannot be subject to a Senate filibuster. The timing of final passage by the Senate could slip into October and even November.