Bill Seeks to Eliminate, Modify Qualified Contract Option

July 12, 2019                     By: Donna Kimura

The legislation aims to preserve LIHTC properties.

Legislation has been introduced to modify the qualified contract option for low-income housing tax credit (LIHTC) properties.

LIHTC developments generally must remain affordable for at least 30 years—a 15-year compliance period and a 15-year extended-use period. However, owners are permitted to pursue a qualified contract, a process that can allow properties to convert to market rate after just 15 years.

Introduced by Sens. Ron Wyden (D-Ore.), Todd Young (R-Ind.), Ben Cardin (D-Md.), and Sherrod Brown (D-Ohio), the Save Affordable Housing Act (S. 1956) seeks to eliminate the option for future projects. In addition, it would alter the statutory qualified contract price formula and require existing properties to be sold at a fair-market price.

The legislation seeks to prevent the premature loss of affordable housing and ensure that housing credit properties remain affordable for at least 30 years. Many states have set longer affordability requirements..........................Read More