II 

118TH CONGRESS 

2D SESSION S. 5156 

To amend the Internal Revenue Code of 1986 to enhance the low-income 

housing tax credit, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

SEPTEMBER 24, 2024 

Mr. WHITEHOUSE (for himself and Mr. REED) 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 enhance 

the low-income housing tax credit, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Affordable Housing 

5 Construction Act’’. 

6 SEC. 2. INCREASE IN STATE HOUSING CREDIT CEILING. 

7 (a) IN GENERAL.—Section 42(h)(3)(C)(ii) of the In8 ternal Revenue Code of 1986 is amended— 

9 (1) by striking ‘‘$1.75’’ in subclause (I) and in10 serting ‘‘$9.79’’, and 


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1 (2) by striking ‘‘$2,000,000’’ in subclause (II) 

2 and inserting ‘‘$11,340,000’’. 

3 (b) INFLATION ADJUSTMENTS.—Section 42(h)(3)(H) 

4 is amended— 

5 (1) by striking ‘‘In the case of a calendar year 

6 after 2002, the $2,000,000 and $1.75 amounts in 

7 subparagraph (C)’’ in clause (i) and inserting ‘‘In 

8 the case of a calendar year after 2025, the 

9 $16,542,968 and $9.79 amounts in subparagraph 

10 (C)’’, 

11 (2) by striking ‘‘calendar year 2001’’ in clause 

12 (i)(II) and inserting ‘‘calendar year 2024’’, 

13 (3) by striking ‘‘$2,000,000’’ in clause (ii)(I) 

14 and inserting ‘‘$11,340,000’’, and 

15 (4) by striking ‘‘$1.75’’ in clause (ii)(II) and in16 serting ‘‘$9.79’’. 

17 (c) EFFECTIVE DATE.—The amendments made by 

18 this section shall apply to calendar years beginning after 

19 December 31, 2024. 

20 SEC. 3. INCREASED CREDIT AMOUNTS AND CREDIT ALLO21 CATION SET-ASIDES FOR CERTAIN BUILD22 INGS. 

23 (a) INCREASED CREDIT AMOUNTS.— 


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1 (1) IN GENERAL.—Section 42(d)(5) of the In2 ternal Revenue Code of 1986 is amended by adding 

3 at the end the following new subparagraphs: 

4 ‘‘(C) INCREASE IN CREDIT FOR PRE5 VAILING WAGE BUILDINGS.— 

6 ‘‘(i) IN GENERAL.—In the case of any 

7 building which pays applicable laborers at 

8 rates not less than the prevailing rates for 

9 construction, alteration, or repair of a 

10 similar character in the locality in which 

11 such facility is located as most recently de12 termined by the Secretary of Labor, in ac13 cordance with subchapter IV of chapter 31 

14 of title 40, United States Code, and which 

15 is designated by the housing credit agency 

16 as requiring the increase in credit under 

17 this subparagraph in order for such pay18 ments to be financially feasible as part of 

19 a qualified low-income housing project— 

20 ‘‘(I) in the case of a new build21 ing, the eligible basis of such building 

22 shall be increased by 50 percent of 

23 such basis determined without regard 

24 to this subparagraph and subparaVerDate Sep 11 2014 06:39 Oct 05, 2024 Jkt 059200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S5156.IS S5156

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1 graphs (B), (D), (E), (F), and (G), 

2 and 

3 ‘‘(II) in the case of an existing 

4 building, the rehabilitation expendi5 tures taken into account under sub6 section (e) shall be increased by 50 

7 percent of such expenditures deter8 mined without regard to this subpara9 graph and subparagraphs (B), (D), 

10 (E), (F), and (G). 

11 ‘‘(ii) APPLICABLE LABORERS.—For 

12 purposes of this clause, the term ‘applica13 ble laborers’ means, with respect to any 

14 building, any laborers employed by the tax15 payer, or any contractor or subcontractor, 

16 in the construction, alteration, or repair of 

17 the building. 

18 ‘‘(D) INCREASE IN CREDIT FOR BUILDINGS

19 POWERED BY RENEWABLE ENERGY.— 

20 ‘‘(i) IN GENERAL.—In the case of any 

21 building which utilizes renewable energy 

22 (as defined in section 203(b)(2) of the En23 ergy Policy Act of 2005), and which is des24 ignated by the housing credit agency as re25 quiring the increase in credit under this 


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1 subparagraph in order for such renewable 

2 energy use to be financially feasible as part 

3 of a qualified low-income housing project— 

4 ‘‘(I) in the case of a new build5 ing, the eligible basis of such building 

6 shall be increased by the applicable 

7 percentage of such basis determined 

8 without regard to this subparagraph 

9 and subparagraphs (B), (C), (E), (F), 

10 and (G), and 

11 ‘‘(II) in the case of an existing 

12 building, the rehabilitation expendi13 tures taken into account under sub14 section (e) shall be increased by the 

15 applicable percentage of such expendi16 tures determined without regard to 

17 this subparagraph and subparagraphs 

18 (B), (C), (E), (F), and (G). 

19 ‘‘(ii) APPLICABLE PERCENTAGE.—For 

20 purposes of this subparagraph, the applica21 ble percentage is 50 percent of the percent22 age of the energy utilized by such building 

23 which is from renewable energy (as so de24 fined). 


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1 ‘‘(E) INCREASE IN CREDIT FOR BUILDINGS

2 NEAR PUBLIC TRANSPORTATION.— 

3 ‘‘(i) IN GENERAL.—In the case of any 

4 building which is located in a public trans5 portation zone and which is designated by 

6 the housing credit agency as requiring the 

7 increase in credit under this subparagraph 

8 in order for such building to be financially 

9 feasible as part of a qualified low-income 

10 housing project— 

11 ‘‘(I) in the case of a new build12 ing, the eligible basis of such building 

13 shall be increased by 25 percent of 

14 such basis determined without regard 

15 to this subparagraph and subpara16 graphs (B), (C), (D), (F), and (G), 

17 and 

18 ‘‘(II) in the case of an existing 

19 building, the rehabilitation expendi20 tures taken into account under sub21 section (e) shall be increased by 25 

22 percent of such expenditures deter23 mined without regard to this subpara24 graph and subparagraphs (B), (C), 

25 (D), (F), and (G). 


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1 ‘‘(ii) PUBLIC TRANSPORTATION

2 ZONE.—For purposes of this subpara3 graph, a building is located in a public 

4 transportation zone if— 

5 ‘‘(I) the building is within one6 half mile of an existing commuter rail, 

7 light rail, or subway station, 

8 ‘‘(II) the building is within one9 quarter mile of one or more existing 

10 public bus stops, or 

11 ‘‘(III) the building is located in a 

12 census tract— 

13 ‘‘(aa) designated by the Ad14 ministrator of the Environmental 

15 Protection Agency as having 

16 above average walkability, or 

17 ‘‘(bb) which is adjacent to 2 

18 or more such census tracts de19 scribed in item (aa). 

20 ‘‘(F) INCREASE IN CREDIT FOR BUILDINGS

21 SERVING HOUSEHOLDS WITH PEOPLE WITH

22 DISABILITIES.— 

23 ‘‘(i) IN GENERAL.—In the case of any 

24 building which has low-income units that 

25 meet the applicable design standards for 


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1 occupancy by persons with mental, phys2 ical, sensory, or developmental disabilities, 

3 and which is designated by the housing 

4 credit agency as requiring the increase in 

5 credit under this subparagraph in order for 

6 such building to be financially feasible as 

7 part of a qualified low-income housing 

8 project— 

9 ‘‘(I) in the case of a new build10 ing, the eligible basis of such building 

11 shall be increased by the applicable 

12 percentage of such basis determined 

13 without regard to this subparagraph 

14 and subparagraphs (B), (C), (D), (D), 

15 and (G), and 

16 ‘‘(II) in the case of an existing 

17 building, the rehabilitation expendi18 tures taken into account under sub19 section (e) shall be increased by the 

20 applicable percentage of such expendi21 tures determined without regard to 

22 this subparagraph and subparagraphs 

23 (B), (C), (D), (E), and (G). 

24 ‘‘(ii) DESIGN STANDARDS.—For pur25 poses of clause (i), the term ‘applicable deVerDate Sep 11 2014 06:39 Oct 05, 2024 Jkt 059200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S5156.IS S5156

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1 sign standards’ means the principles and 

2 standards of adaptable design as detailed 

3 in the Uniform Federal Accessibility 

4 Standards, or any successor standard des5 ignated by the Secretary. 

6 ‘‘(iii) APPLICABLE PERCENTAGE.— 

7 For purposes of this subparagraph, the 

8 term ‘applicable percentage’ means the 

9 number of percentage points (not to exceed 

10 50 percentage points) by which— 

11 ‘‘(I) the ratio (expressed as a 

12 percentage and rounded to the nearest 

13 percent) of the number of low-income 

14 units in the building that meet the ap15 plicable design standards for occu16 pancy by persons with mental, phys17 ical, sensory, or developmental disabil18 ities bears to the total number of 

19 units in the building, exceeds 

20 ‘‘(II) 5 percentage points. 

21 ‘‘(G) INCREASE IN CREDIT FOR BUILDINGS

22 SERVING EXTREMELY LOW-INCOME FAMI23 LIES.— 

24 ‘‘(i) IN GENERAL.—In the case of any 

25 building in which 20 percent of the units 


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1 are occupied by extremely low-income fami2 lies and which is designated by the housing 

3 credit agency as requiring the increase in 

4 credit under this subparagraph in order for 

5 such building to be financially feasible as 

6 part of a qualified low-income housing 

7 project— 

8 ‘‘(I) in the case of a new build9 ing, the eligible basis of such building 

10 shall be increased by 50 percent of 

11 such basis determined without regard 

12 to this subparagraph and subpara13 graphs (B), (C), (D), (E), and (F), 

14 and 

15 ‘‘(II) in the case of an existing 

16 building, the rehabilitation expendi17 tures taken into account under sub18 section (e) shall be increased by 50 

19 percent of such expenditures deter20 mined without regard to this subpara21 graph and subparagraphs (B), (C), 

22 (D), (E), and (F). 

23 ‘‘(ii) EXTREMELY LOW-INCOME FAMI24 LIES.— For purposes of this subpara25 graph, the term ‘extremely low-income 


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1 families’ means families whose annual in2 comes do not exceed 30 percent of the area 

3 median gross income, as determined in 

4 consultation with the Secretary of Health 

5 and Human Services. 

6 ‘‘(H) LIMITATION.—Notwithstanding sub7 paragraphs (B), (C), (D), (E), (F), and (G)— 

8 ‘‘(i) the eligible basis of any building 

9 shall not exceed an amount equal to 250 

10 percent of such basis determined without 

11 regard to subparagraphs (B), (C), (D), 

12 (E), (F), and (G), and 

13 ‘‘(ii) the rehabilitation expenditures 

14 taken into account under subsection (e) 

15 shall not exceed 250 percent of such ex16 penditures determined without regard to 

17 subparagraphs (B), (C), (D), (E), (F), and 

18 (G).’’. 

19 (2) CONFORMING AMENDMENTS.—Section 

20 42(d)(5)(B)(i) of such Code is amended— 

21 (A) by striking ‘‘shall be 130 percent of’’ 

22 each place it appears in subclauses (I) and (II) 

23 and inserting ‘‘shall be increased by 30 percent 

24 of’’, and 


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1 (B) by striking ‘‘this subparagraph’’ each 

2 place it appears in subclauses (I) and (II) and 

3 inserting ‘‘this subparagraph and subpara4 graphs (B), (C), (D), (E), (F), and (G)’’. 

5 (3) EFFECTIVE DATE.—The amendments made 

6 by this subsection shall apply to buildings placed in 

7 service after the date of the enactment of this Act. 

8 (b) SET-ASIDE FOR CERTAIN PROJECTS.— 

9 (1) IN GENERAL.—Section 42(h) of the Internal 

10 Revenue Code of 1986 is amended by adding at the 

11 end the following new paragraph: 

12 ‘‘(9) PORTION OF STATE CEILING SET-ASIDE

13 FOR CERTAIN PROJECTS.— 

14 ‘‘(A) IN GENERAL.—Not more than two15 thirds of the State housing credit ceiling for 

16 any State for any calendar year shall be allo17 cated to projects other than qualified low-in18 come housing projects described in subpara19 graphs (C), (D), (E), (F), and (G) of sub20 section (d)(5). 

21 ‘‘(B) STATE MAY NOT OVERRIDE SET22 ASIDE.—Nothing in subparagraph (F) of para23 graph (3) shall be construed to permit a State 

24 not to comply with subparagraph (A) of this 

25 paragraph.’’. 


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1 (2) EFFECTIVE DATE.—The amendments made 

2 by this subsection shall apply to calendar years be3 ginning after the date of the enactment of this Act. 

4 SEC. 4. TAX-EXEMPT BOND FINANCING REQUIREMENT. 

5 (a) IN GENERAL.—Section 42(h)(4) of the Internal 

6 Revenue Code of 1986 is amended by striking subpara7 graph (B) and inserting the following: 

8 ‘‘(B) SPECIAL RULE WHERE MINIMUM

9 PERCENT OF BUILDINGS IS FINANCED WITH

10 TAX-EXEMPT BONDS SUBJECT TO VOLUME

11 CAP.—For purposes of subparagraph (A), para12 graph (1) shall not apply to any portion of the 

13 credit allowable under subsection (a) with re14 spect to a building if— 

15 ‘‘(i) 50 percent or more of the aggre16 gate basis of such building and the land on 

17 which the building is located is financed by 

18 1 or more obligations described in subpara19 graph (A), or 

20 ‘‘(ii)(I) 15 percent or more of the ag21 gregate basis of such building and the land 

22 on which the building is located is financed 

23 by 1 or more qualified obligations, and 

24 ‘‘(II) 1 or more of such qualified 

25 obligations— 


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1 ‘‘(aa) are part of an issue 

2 the issue date of which is after 

3 December 31, 2023, and 

4 ‘‘(bb) provide the financing 

5 for not less than 5 percent of the 

6 aggregate basis of such building 

7 and the land on which the build8 ing is located. 

9 ‘‘(C) QUALIFIED OBLIGATION.—For pur10 poses of subparagraph (B)(ii), the term ‘quali11 fied obligation’ means an obligation which is de12 scribed in subparagraph (A) and which is part 

13 of an issue the issue date of which is before 

14 January 1, 2026.’’. 

15 (b) EFFECTIVE DATE.— 

16 (1) IN GENERAL.—The amendment made by 

17 this section shall apply to buildings placed in service 

18 in taxable years beginning after December 31, 2023. 

19 (2) REHABILITATION EXPENDITURES TREATED

20 AS SEPARATE NEW BUILDING.—In the case of any 

21 building with respect to which any expenditures are 

22 treated as a separate new building under section 

23 42(e) of the Internal Revenue Code of 1986, for 

24 purposes of paragraph (1), both the existing building 

25 and the separate new building shall be treated as 


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1 having been placed in service on the date such ex2 penditures are treated as placed in service under 

3 section 42(e)(4) of such Code. 

4 SEC. 5. MODIFICATION OF EXTENDED USE PERIOD. 

5 (a) IN GENERAL.—Section 42(h)(6)(D)(ii)(II) of the 

6 Internal Revenue Code of 1986 is amended by striking 

7 ‘‘15 years’’ and inserting ‘‘35 years’’. 

8 (b) EFFECTIVE DATE.—The amendment made by 

9 this section shall apply to agreements entered into in tax10 able years beginning after the date of the enactment of 

11 this Act. 

Æ 


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