The Build Back Better bill, which includes a historic investment in affordable housing, has been dealt a major blow by Sen. Joe Manchin (D-W.Va.), who said he will not vote for the legislation.
The loss of that one vote looks like it will, at least temporarily, derail hopes of that bill passing in the evenly split Senate.
The Senate version of the sweeping $2 trillion Build Back Better legislation included increases to the annual 9% low-income housing tax credit (LIHTC) allocation, a reduction of the 50% bond financing threshold test to 25%, and other key changes.
Bill supporters were hopeful that Manchin would eventually come around and back the bill with some changes, but the senator appeared on Fox News the Sunday before Christmas to say he was a “no” on the package. The Senate is out until Jan. 3.
David Gasson, a partner at MG Housing Strategies and executive director of the Housing Advisory Group, and others say they will continue to plug away at getting the affordable housing provisions in the bill passed despite the setback.
One opportunity may lie in a tax extenders package. The 12.5% LIHTC increase that was approved in 2018 expires at the end of this year and would qualify for an extenders package, says Gasson.
This may be a way to at least keep the 12.5% increase before anything else, says Bob Moss, also a partner at MG Housing Strategies.
Gasson also notes that Congress passed a continuing resolution (CR) to extend funding for federal programs through Feb. 18, 2022. Republicans had been pushing back on the budget because of Build Back Better, but there may now a new opportunity for all sides to come to the table and discuss the budget rather than passing another CR after Feb. 18.
“When some doors close, other doors open,” Gasson says. “Well, some doors may be opening.”
Although Build Back Better may not pass the way housing advocates had hoped, the industry should still note how much it was able to get into the bill this year, according to Gasson.
“Stay tuned,” adds Moss. “It’s not over until it’s over.”
