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CDFA Legislative and Federal Affairs Update - July 7, 2020

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Legislative and Federal Affairs Update
July 7, 2020
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Legislative and Federal Affairs Update

Legislative Features

House Sends Massive Infrastructure Bill to the Senate
The bill, which passed in the House, 233-188, is massive in its scope with $1.5 trillion for priorities such as schools, hospitals, housing, broadband, drinking water, stormwater, the energy grid, and vehicle safety. The Moving Forward Act includes several bond financing provisions, makes the NMTC permanent, gives LIHTC a major boost, delays the phasedown of the ITC, and increases the Historic Tax Credit, among many other provisions.

Expanded Use of PABs Included in House Infrastructure Bill
A bipartisan bill included in House Democrats' larger infrastructure package would expand the use of tax-exempt private activity bonds to finance small to mid-sized manufacturing and agricultural sectors. The Modernizing Agricultural and Manufacturing Bonds Act would change certain definitions to try to expand the use of small issue manufacturing bonds, known as industrial development bonds, and first-time farmer bonds, often referred to as aggie bonds.

House Infrastructure Bill Would Bring Back Muni Debt Refinancing
New language in an infrastructure bill introduced by House Democrats would undo limitations on advance refunding bonds put in place by the 2017 tax law in addition to offering other tax incentives aimed at financing building and rehabilitation projects.

House Infrastructure Legislation Includes Major LIHTC Boosts, Permanency for NMTC, Increase in HTC Percentage and Delay of ITC Phasedown
H.R.2 includes provisions to establish a permanent minimum 4 percent rate for the LIHTC, increase the annual LIHTC allocation amount, temporarily reduce the test for bond-financed housing to 25 percent and permanently extend the NMTC at $5 billion, increase the historic tax credit (HTC) applicable percentage from to 30 percent for five years and delay the phasedown of the renewable energy investment tax credit (ITC) until 2026.

Qualified Infrastructure Bonds Are the New Build America Bonds
The new Qualified Infrastructure Bonds, which are modeled after Build America Bonds, would have their direct-pay subsidies phase lower to 38% in 2025, 34% in 2027, and 30% permanently thereafter. The legislation also would restore tax-exempt advance refunding 30 days following enactment into law and authorize the issuance of $30 billion in qualified school infrastructure bonds (QSIBs) over three years.

Community Development Lenders Push for Larger Role in Virus Aid
Certified by the Treasury Department, the nation's more than 1,000 CDFIs provide credit to underserved communities in urban and rural areas. They typically match the public dollars they receive with private funds, which can be as much as 12 times the government's investment. Without additional help from Congress, many CDFIs are worried about the stability of their balance sheets and their ability to ramp up financing to the communities and small businesses lawmakers themselves say need special attention in the pandemic.

Sign on to Help Communities Recover by Extending, Expanding the New Markets Tax Credit
The New Markets Tax Credit (NMTC) Coalition is once again organizing a sign-on letter in support of an NMTC extension. This letter also calls for additional funds to communities to recover from the COVID crisis. Please sign your organization onto this letter in support of additional NMTCs to address the COVID-19 crisis.

Upcoming Events
CDFA Federal Financing Webinar Series: Federal Recovery Resources from the EPA

CDFA-ARI Rural Finance Webinar Series: Access to Capital and Community Facilities
Wednesday, July 8, 2020 - 1:00 PM - 2:30 PM Central
During the fourth installment of the CDFA-ARI Rural Finance Webinar Series, join us for a discussion of community facilities resources and other accessible capital for rural community development.

CDFA-Bricker PACE Webinar Series: Focusing on Sustainability Using PACE
Tuesday, July 14, 2020 - 11:00 AM - 1:00 PM Eastern
This webinar will take a look at the use of PACE in the context of green and sustainability goals and metrics. How will PACE fit into a community's effort to drive a more sustainable economy while pushing economic development goals and objectives? How can PACE be a driver of green principles and strategies to make a community more environmentally friendly? Join industry leaders for a discussion that answers these questions and more.

Federal Features

USDA Food Box Program 25% Short of Its Forecasted Delivery
In mid-April, the Department of Agriculture (USDA) announced a novel plan to connect struggling farmers directly with families dealing with virus-related loss of income: The aptly named Farmers to Families Food Box program would pay distributors to purchase produce, dairy, and meat; package the food into boxes; and deliver those boxes to churches, schools, and food banks. As of July 1, the USDA is 10 million boxes and 25 percent short of its forecasted delivery.

Minority Business Development Agency Awards $10M in Federal Funding from CARES Act
The U.S. Department of Commerce, Minority Business Development Agency (MBDA) announced the deployment of $10 million in CARES Act funding to the network of MBDA Business Centers and national minority chambers of commerce. The grants will be used for education, training, and advising small and minority business enterprises in their recovery from the effects of the COVID-19 crisis.

MARAD Awards $9.5M for Marine Highways Projects
The U.S. Department of Transportation's Maritime Administration (MARAD) awarded $9.5M in grants to eight marine highways projects across the Nation under the America's Marine Highway Program. The funding supports the enhancement of navigable waterways and expands existing waterborne freight services. Of the eight projects that were awarded grants, seven are located in Opportunity Zones.

IRS Extends Due Dates For Making Investments For New Markets Tax Credit
Due to COVID-19, the IRS released Notice 2020-49, which extends certain time criteria related to the New Markets Tax Credit (NMTC) program. Under the notice, any due dates for making investments, making reinvestments, and expending amounts for the construction of real property that would have fallen between April 1, 2020, and December 31, 2020, are extended until December 31, 2020.

HUD Provides Remaining $2.96B in CARES Act Funding for Homeless Populations
HUD Secretary Ben Carson announced the allocation of $2.96 billion in Emergency Solutions Grants (ESG) funding to support homeless Americans and individuals at risk of becoming homeless because of hardships such as job loss, wage reduction, or illness due to COVID-19.

DOE Announces $11B in Energy Cost-Savings from Better Buildings Initiative Partners
The U.S. Department of Energy (DOE) has announced nearly $11 billion in energy-cost savings by more than 950 public and private sector organizations in DOE's Better Buildings Initiative. To date, partners have saved nearly 1.8 quadrillion British thermal units of energy, which is equivalent to the electricity consumption of 27 million homes in America over one year.

IRS Releases Additional Opportunity Zones Guidance
The IRS released Opportunity Zones Guidance that extends the 180-day window to invest capital gains in qualified opportunity funds, suspends the 30-month substantial improvement period, and more.

Federal Reserve Expands MLF Program to Allow More Issuers to Participate
The Federal Reserve is expanding the number and types of local governments eligible to use its short-term muni note program. The central bank said it would allow all U.S. states to be able to have at least two cities or counties eligible to directly issue notes to its Municipal Liquidity Facility program regardless of population.

Federal Financing Clearinghouse Spotlight

CDFA's Federal Financing Clearinghouse is the only online resource cataloging the development finance programs offered by the federal government. Check out our featured agencies and programs below. >>> Learn More

Agency Seal U.S. Dept. of Homeland Security (DHS)

EB-5 Immigrant Investor Program
Congress created the EB-5 Program in 1990 to stimulate the U.S. economy through job creation and capital investment by foreign investors. In 1992, Congress created the Immigrant Investor Program,...

Agency Seal U.S. Dept. of Housing & Urban Development (HUD)

Rental Assistance Demonstration (RAD)
RAD allows public housing agencies (PHAs) and owners of other HUD-assisted properties to convert units from their original sources of HUD financing to project-based Section 8 contracts.

Agency Seal U.S. Dept. of Justice (DOJ)

Coordinated Tribal Assistance Solicitation (CTAS)
Funding to expand the implementation of community policing and meeting the most serious needs of law enforcement in Tribal Nations.

Agency Seal U.S. Dept. of the Interior (DOI)

Indian Loan Guarantee, Insurance and Interest Subsidy Program
The purpose of the Program is to encourage eligible borrowers to develop viable Indian businesses through conventional lender financing. The direct function of the Program is to help lenders reduce...

The Council of Development Finance Agencies is a national association dedicated to the advancement of development finance concerns and interests. CDFA is comprised of the nation's leading and most knowledgeable members of the development finance community representing public, private and non-profit entities alike. For more information visit CDFA.net or email info@cdfa.net

Council of Development Finance Agencies
100 E. Broad Street, Suite 1200
Columbus, OH 43215
(614) 705-1300


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