II 118TH CONGRESS 1ST SESSION S. 1377 To amend the Internal Revenue Code of 1986 to improve the low-income housing credit. IN THE SENATE OF THE UNITED STATES APRIL 27, 2023 Mr. CASEY (for himself, Ms. DUCKWORTH, Mrs. GILLIBRAND, Ms. KLO- BUCHAR, and Mr. WELCH) introduced the following bill; which was read twice and referred to the Committee on Finance A BILL To amend the Internal Revenue Code of 1986 to improve the low-income housing credit. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Visitable Inclusive Tax 4 credits for Accessible Living (VITAL) Act’’. 5 SEC. 2. PURPOSE. 6 The purposes of this Act are to— 7 (1) increase low-income housing tax credits to 8 increase the stock of disability-accessible and afford- 9 able housing; 10 VerDate Sep 11 2014 01:49 May 10, 2023 Jkt 039200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S1377.IS S1377 pbinns on DSKJLVW7X2PROD with $$_JOB 2 •S 1377 IS (2) ensure that States are using the Federal 1 tax credits to construct housing that will meet the 2 needs of an aging population and currently under- 3 served populations such as households with people 4 with disabilities; 5 (3) encourage States to make sure older adults 6 and underserved populations are integrated into 7 their community and can fully participate in society; 8 and 9 (4) increase technical assistance, awareness, 10 knowledge, and understanding of the low-income 11 housing credit program and the housing needs of 12 older adults and people with disabilities. 13 SEC. 3. FINDINGS. 14 Congress makes the following findings: 15 (1) By 2060, 1 in every 4 Americans will be 16 over age 65, and currently, 2 in 5 adults over age 17 65 have a disability. As people age, they need struc- 18 turally safe and functional housing that accommo- 19 dates people with disabilities. 20 (2) Approximately 26 percent of people in the 21 United States have a disability, yet less than 6 per- 22 cent of the national housing supply is designed to be 23 even rudimentarily accessible. 24 VerDate Sep 11 2014 01:49 May 10, 2023 Jkt 039200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S1377.IS S1377 pbinns on DSKJLVW7X2PROD with $$_JOB 3 •S 1377 IS (3) An accessible home offers specific features 1 or technologies such as lowered kitchen counters and 2 sinks, widened doorways, and zero-step showers. 3 (4) A lack of affordable and accessible housing 4 can relegate people with disabilities to living in insti- 5 tutional settings when they would prefer to live in a 6 community setting. 7 (5) Older adults and people with disabilities 8 prefer to remain in their homes for as long as pos- 9 sible. More than 89 percent of adults aged 65 and 10 over hope to stay in their homes as they age. 11 (6) Older adults and people with disabilities 12 must be able to run errands, work, visit family and 13 friends, and keep doctor appointments, while not al- 14 ways being able to drive. Accessible and affordable 15 public transit options and walkable and roll-able 16 neighborhoods allow older adults and people with 17 disabilities to remain independent and active in their 18 communities. 19 (7) Many older adults and people with disabil- 20 ities are experiencing an affordability crisis. Ap- 21 proximately 4,800,000 non-institutionalized people 22 with disabilities who depend on Federal monthly 23 Supplemental Security Income have incomes aver- 24 aging only about $9,156 per year, low enough to be 25 VerDate Sep 11 2014 01:49 May 10, 2023 Jkt 039200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S1377.IS S1377 pbinns on DSKJLVW7X2PROD with $$_JOB 4 •S 1377 IS priced out of every rental housing market in the na- 1 tion. 2 SEC. 4. INCREASES IN STATE ALLOCATIONS. 3 (a) IN GENERAL.—Clause (ii) of section 42(h)(3)(C) 4 of the Internal Revenue Code of 1986 is amended— 5 (1) by striking ‘‘$1.75’’ in subclause (I) and in- 6 serting ‘‘$4.47’’, and 7 (2) by striking ‘‘$2,000,000’’ in subclause (II) 8 and inserting ‘‘$5,154,965’’. 9 (b) COST-OF-LIVING ADJUSTMENT.—Subparagraph 10 (H) of section 42(h)(3) of the Internal Revenue Code of 11 1986 is amended— 12 (1) by striking ‘‘2002’’ in clause (i) and insert- 13 ing ‘‘2023’’, 14 (2) by striking ‘‘the $2,000,000 and $1.75 15 amounts in subparagraph (C)’’ in clause (i) and in- 16 serting ‘‘the $5,154,965 and $4.47 amounts in sub- 17 paragraph (C)’’, 18 (3) by striking ‘‘2001’’ in clause (i)(II) and in- 19 serting ‘‘2022’’, 20 (4) by striking ‘‘$2,000,000 amount’’ in clause 21 (ii)(I) and inserting ‘‘$5,154,965’’, and 22 (5) by striking ‘‘$1.75 amount’’ in clause 23 (ii)(II) and inserting ‘‘$4.47’’. 24 VerDate Sep 11 2014 01:49 May 10, 2023 Jkt 039200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S1377.IS S1377 pbinns on DSKJLVW7X2PROD with $$_JOB 5 •S 1377 IS (c) EFFECTIVE DATE.—The amendments made by 1 this section shall apply to calendar years beginning after 2 December 31, 2023. 3 SEC. 5. TAX-EXEMPT BOND FINANCING REQUIREMENT. 4 (a) IN GENERAL.—Subparagraph (B) of section 5 42(h)(4) of the Internal Revenue Code of 1986 is amended 6 by adding at the end the following: ‘‘In the case of build- 7 ings financed by an obligation first taken into account 8 under section 146 in calendar years beginning after 2023, 9 the preceding sentence shall be applied by substituting ‘25 10 percent’ for ‘50 percent’.’’. 11 (b) EFFECTIVE DATE.—The amendment made by 12 this section shall apply to buildings placed in service in 13 taxable years beginning after December 31, 2023. 14 SEC. 6. INCREASE IN CREDIT FOR PROJECTS DESIGNATED 15 TO SERVE HOUSEHOLDS WITH PEOPLE WITH 16 DISABILITIES. 17 (a) IN GENERAL.—Paragraph (5) of section 42(d) of 18 the Internal Revenue Code of 1986 is amended by adding 19 at the end the following new subparagraph: 20 ‘‘(C) INCREASE IN CREDIT FOR PROJECTS 21 DESIGNATED TO SERVE HOUSEHOLDS WITH 22 PEOPLE WITH DISABILITIES.— 23 ‘‘(i) IN GENERAL.—In the case of any 24 building— 25 VerDate Sep 11 2014 01:49 May 10, 2023 Jkt 039200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S1377.IS S1377 pbinns on DSKJLVW7X2PROD with $$_JOB 6 •S 1377 IS ‘‘(I) 50 percent or more of the 1 low-income units in the building are 2 units designated by the taxpayer to 3 meet the applicable design standards 4 for occupancy by persons with mental, 5 physical, sensory, or developmental 6 disabilities, 7 ‘‘(II) which is located in a census 8 block group designated by the Envi- 9 ronmental Protection Agency as 10 being— 11 ‘‘(aa) above average or bet- 12 ter in terms of walkability, or 13 ‘‘(bb) adjacent to 2 or more 14 census tracts described in item 15 (aa), and 16 ‘‘(III) which is designated by the 17 housing credit agency as requiring the 18 increase in credit under this subpara- 19 graph in order for such building to be 20 financially feasible as part of a quali- 21 fied low-income housing project, 22 subparagraph (B) shall not apply to the 23 portion of such building which is comprised 24 of such units, and the eligible basis of such 25 VerDate Sep 11 2014 01:49 May 10, 2023 Jkt 039200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S1377.IS S1377 pbinns on DSKJLVW7X2PROD with $$_JOB 7 •S 1377 IS portion of the building shall be 130 per- 1 cent of such basis determined without re- 2 gard to this subparagraph. 3 ‘‘(ii) DESIGN STANDARDS.—For pur- 4 poses of clause (i)(I), the term ‘applicable 5 design standards’ means the principles and 6 standards of adaptable design as detailed 7 in the Uniform Federal Accessibility 8 Standards, or any successor standard des- 9 ignated by the Secretary.’’. 10 (b) EFFECTIVE DATE.—The amendment made by 11 this section shall apply to buildings which receive alloca- 12 tions of housing credit dollar amount or, in the case of 13 projects financed by tax-exempt obligations as described 14 in section 42(h)(4) of the Internal Revenue Code of 1986, 15 which are first taken into account under section 146 of 16 such Code, after the date of the enactment of this Act. 17 SEC. 7. REQUIREMENT FOR PROJECTS DESIGNATED TO 18 SERVE HOUSEHOLDS WITH PEOPLE WITH 19 DISABILITIES. 20 (a) IN GENERAL.—Paragraph (1) of section 42(m) 21 of the Internal Revenue Code of 1986 is amended by add- 22 ing at the end the following new subparagraph: 23 VerDate Sep 11 2014 01:49 May 10, 2023 Jkt 039200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S1377.IS S1377 pbinns on DSKJLVW7X2PROD with $$_JOB 8 •S 1377 IS ‘‘(E) PROJECTS DESIGNATED TO SERVE 1 HOUSEHOLDS WITH PEOPLE WITH DISABIL- 2 ITIES.— 3 ‘‘(i) IN GENERAL.—The qualified allo- 4 cation plan shall ensure that, with respect 5 to any 3-year period, the applicable per- 6 centage is not less than 40 percent. 7 ‘‘(ii) APPLICABLE PERCENTAGE.—For 8 purposes of this subparagraph, the applica- 9 ble percentage is the ratio (expressed as a 10 percentage) of— 11 ‘‘(I) the number of low-income 12 units in all projects receiving an allo- 13 cation of the housing credit dollar 14 amount during such period which 15 meet the requirements of subclause 16 (I) of subsection (d)(5)(C)(i), to 17 ‘‘(II) the aggregate number of all 18 low-income units in all projects receiv- 19 ing an allocation of the housing credit 20 dollar amount during such period. 21 ‘‘(iii) SPECIAL RULE.—For purposes 22 of clause (ii)(I), any low-income unit which 23 is part of a project which meets the re- 24 quirements of both subclause (I) and sub- 25 VerDate Sep 11 2014 01:49 May 10, 2023 Jkt 039200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S1377.IS S1377 pbinns on DSKJLVW7X2PROD with $$_JOB 9 •S 1377 IS clause (II) of subsection (d)(5)(C)(i) shall 1 be counted twice.’’. 2 (b) EFFECTIVE DATE.—The amendment made by 3 this section shall apply to buildings which receive alloca- 4 tions of housing credit dollar amount or, in the case of 5 projects financed by tax-exempt obligations as described 6 in section 42(h)(4) of the Internal Revenue Code of 1986, 7 which are first taken into account under section 146 of 8 such Code, after the date of the enactment of this Act. 9 SEC. 8. RESOURCE CENTERS FOR THE LOW-INCOME HOUS- 10 ING TAX CREDIT PROGRAM. 11 (a) DEFINITIONS.—In this section: 12 (1) CENTER.—The term ‘‘Center’’ means a Re- 13 source Center established under subsection (b). 14 (2) PROGRAM.—The term ‘‘Program’’ means a 15 program established for allocating amount under 16 section 42(h) of the Internal Revenue Code of 1986. 17 (b) ESTABLISHMENT.—Each State housing finance 18 agency shall establish and operate a Resource Center for 19 the Low-Income Housing Tax Credit Program to support 20 new applicants and recipients for the Program in the State 21 by— 22 (1) providing potential applicants and recipients 23 with information and technical assistance to effec- 24 tively prepare and submit a Program application; 25 VerDate Sep 11 2014 01:49 May 10, 2023 Jkt 039200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S1377.IS S1377 pbinns on DSKJLVW7X2PROD with $$_JOB 10 •S 1377 IS (2) ensuring that all interested and eligible en- 1 tities have the tools to apply for the Program; 2 (3) prioritizing providing assistance to nonprofit 3 and first-time developers applying for the Program; 4 (4) identifying potential barriers to preparing 5 and submitting a successful application for the Pro- 6 gram; 7 (5) prioritizing providing assistance to devel- 8 opers dedicated to serving communities who have 9 faced a history of housing discrimination; and 10 (6) proposing streamlined solutions to those 11 barriers that the State and each locality within the 12 State can adopt. 13 (c) OPERATING STANDARDS AND REPORTING RE- 14 QUIREMENTS.—Each State housing finance agency shall 15 develop and issue operating standards and reporting re- 16 quirements for the Center established by the agency. 17 (d) SET ASIDE.—There is authorized to be appro- 18 priated $8,250,000 for fiscal year 2024 and each fiscal 19 year thereafter to carry out this section, of which 20 $150,000 shall be allocated each fiscal year to each State 21 housing finance agency located in— 22 (1) a State of the United States; 23 (2) the District of Columbia; or 24 (3) a territory of the United States. 25 VerDate Sep 11 2014 01:49 May 10, 2023 Jkt 039200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S1377.IS S1377 pbinns on DSKJLVW7X2PROD with $$_JOB 11 •S 1377 IS SEC. 9. NATIONAL LOW-INCOME HOUSING TAX CREDIT AD- 1 VISORY COUNCIL. 2 (a) DEFINITIONS.—In this section: 3 (1) COUNCIL.—The term ‘‘Council’’ means the 4 National Low-Income Housing Tax Credit Advisory 5 Council established under subsection (b). 6 (2) COVERED PROPERTY.—The term ‘‘covered 7 property’’ means a building receiving an allocation of 8 credit under section 42 of the Internal Revenue 9 Code of 1986. 10 (b) ESTABLISHMENT.—There is established a Na- 11 tional Low-Income Housing Tax Credit Advisory Council. 12 (c) MEMBERSHIP.— 13 (1) SELECTION; CHAIR.—The Council shall be 14 comprised of members selected by a designee jointly 15 selected by the Secretary of Housing and Urban De- 16 velopment and the Secretary of the Treasury, who 17 shall serve as chair of the Council. 18 (2) MEMBERS.—The Council shall be composed 19 of not less than 1 representative from each of the 20 following groups: 21 (A) Community-based organizations that 22 support individuals with disabilities living in 23 covered properties. 24 VerDate Sep 11 2014 01:49 May 10, 2023 Jkt 039200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\S1377.IS S1377 pbinns on DSKJLVW7X2PROD with $$_JOB 12 •S 1377 IS (B) Community-based organizations that 1 support older adults living in covered prop- 2 erties. 3 (C) Community-based organizations that 4 support veterans living in covered properties. 5 (D) Community-based organizations that 6 support families and children living in covered 7 properties. 8 (E) A multi-State not-for-profit housing 9 developer. 10 (F) A multi-State for-profit housing devel- 11 oper. 12 (G) Investors or syndicators of funds to 13 which credits allocated under section 42 of the 14 Internal Revenue Code of 1986 are sold. 15 (H) The research community. 16 (I) State housing finance agencies. 17 (J) Community-based organizations that 18 support individuals protected from discrimina- 19 tion under the Fair Housing Act (42 U.S.C. 20 3601 et seq.). 21 (3) QUALIFICATIONS.—The members of the 22 Council shall— 23 (A) have a lived experience as part of the 24 group they represent; and 25 VerDate Sep 11 2014 01:49 May 10, 2023 Jkt 039200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\S1377.IS S1377 pbinns on DSKJLVW7X2PROD with $$_JOB 13 •S 1377 IS (B) represent a diversity of— 1 (i) educational and professional back- 2 grounds; 3 (ii) racial, ethnic, gender, and lin- 4 guistic id [Text truncated for display. 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