Affordable seniors housing owners, residents benefit from legislation
A bill that would benefit owners and residents of affordable seniors housing is headed toward President Barack Obama's desk after passing both chambers of Congress unanimously.
The Housing Opportunity Through Modernization Act (H.R. 3700), in the works for more than a decade, makes significant changes to the country's rental assistance programs. Introduced by Rep. Blaine Luetkemeyer (R-MO) in late 2015, it was passed by the House of Representatives in February and by the Senate on Thursday. The act modifies U.S. Department of Housing and Urban Development, Federal Housing Authority and Department of Agriculture housing programs.
“There are provisions in there that we think are really going to help get more units online for low-income seniors and make the operating of existing low-income, federally subsidized units much more streamlined, both for owners and for tenants,” LeadingAge Director Housing Policy and Priorities Linda Couch told McKnight's Senior Living.
If the president signs the bill into law, public housing agencies would be able to attach up to 30% of their project-based vouchers to specific housing units if the owner agrees to either rehabilitate or construct the units or agrees to set aside a portion of the units in an existing development. The current limit is 20%. The bill also would do away with the limit on the number of project-based vouchers that can be used in any one seniors housing community, would allow vouchers to be project-based for 20 years instead of the current 15, and would enable public housing agencies to permit community owners to manage site-specific waiting lists.
HOTMA, as it is called, also would change how income is calculated when rents are set, allowing seniors to deduct 10% of unreimbursed medical expenses from their incomes rather than the current 3%. The bill also would increase the standard income deduction for the lowest-income households to $525 per month from the current $400, and this deduction would be indexed to inflation.
Project sponsors and owners would be able to use income determinations made by other federal means-tested public assistance programs, such as Medicaid and the Supplemental Nutrition Assistance Program.
“It's a pretty big bill,” Couch said.
LeadingAge also is keeping track of progress on other legislation that would benefit low-income seniors and affordable housing developers and owners — two bills introduced by Sens. Maria Cantwell (D-WA) and Orrin Hatch (R-UT). Both bills are called the Affordable Housing Credit Improvement Act, but the second one to be introduced (S. 3237), which occurred Thursday, contains more provisions than the other one (S. 2962).
“We don't think this will pass this year,” Couch said. “They're really laying the groundwork for next year.” But LeadingAge is hopeful of ultimate success for at least one of the bills because most of the provisions are not controversial, Couch said, and Hatch chairs the Senate Finance Committee, of which Cantwell is a member.
The legislation would increase the per-capita allocation of federal tax credits to the states by 50% over five years beginning in 2017.
“It really just speaks to the need for affordable housing and the tax credit's ability to leverage private financing and bring in the nonprofit sector and the for-profit sector to help address the nation's housing needs,” Couch said.
In their allocating processes for the program, she added, many states set aside portions of their tax credits for senior properties or give extra points in their applications for properties that serve seniors or provide some sort of services space or enhanced service coordination. “So we really see this as a stepping-off point for expanding the number of units that are affordable to seniors,” Couch said.
Additionally, S. 3237 contains a provision that would allow property owners and developers that serve the poorest households to obtain additional resources beyond the tax credit that is based on the cost to build the property. “That provision is really going to help the tax credit serve extremely low-income seniors, who otherwise really can't afford to live in tax-credit properties without another kind of rental assistance, like a voucher,” Couch said. “Putting more subsidy in per unit will bridge the gap between what extremely low-income households can afford and what it actually costs to operate the unit and maintain the building in a solid way. We think that's really important.”
Most affordable seniors housing serves those at the lowest income levels, Couch said, “so the more we can make the tax credit program work for the lowest-income seniors, the better off we'll all be.”
Approximately 32% of tax-credit units have at least one person living in them who is aged more than 62 years, Couch said. “The low-income tax credit is the main driver for affordable housing production in the United States,” she said.