Washington – Today House Ways and Means Select Revenue Measures Subcommittee Chairman Mike Thompson (CA-05) announced that the Internal Revenue Service (IRS) has issued much-needed guidance clarifying that tax-exempt Private Activity Bonds (PABs) can be used to help finance housing projects for veterans, farmworkers and other populations.
This clarification was needed after reports at the end of 2018 that the IRS had reinterpreted PABs to prevent them from being used alongside Low Income Housing Tax Credits were preventing multiple shovel-ready affordable housing projects for veterans from moving forward. Thompson first wrote to IRS Commissioner Rettig in November raising this issue and submitted questions for the record to Treasury Secretary Mnuchin last week continuing his call for the IRS to issue clarification. Thompson’s North Bay district suffers from a severe housing shortage, only worsened by the October 2017 fires, and this fix allows for the development of new and more affordable housing.
“Our district was facing a housing crisis even before the tragic 2017 fires and that crisis has only worsened in the months since. There is no reason why these tax credits shouldn’t be used to finance housing development projects for veterans, farmworkers, and other populations I represent who desperately need access to affordable housing,”said Chairman Thompson. “That’s why I wrote to the IRS and asked Secretary Mnuchin to make this simple, no-cost fix to help alleviate our housing shortage. This was the original intent of these bonds and I am glad the IRS issued this clarification. I will keep pushing to bring every federal dollar and resource to bear on addressing our housing and all recovery needs.”
A copy of Thompson’s 2018 letter and Questions for the Record to Sec. Mnuchin are attached to this release.