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CDFA Legislative and Federal Affairs Update - December 7, 2021

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Legislative and Federal Affairs Update
December 7, 2021
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Legislative and Federal Affairs Update

Spotlight

President Biden Signs $1T Bipartisan Infrastructure Bill Into Law
President Biden signed a $1 trillion infrastructure bill into law on Monday, enacting a key piece of his domestic spending agenda that will funnel billions to states and local governments to upgrade outdated roads, bridges, transit systems, and more. Details of the bill are available in the CDFA Advocacy Center.

CDFA Publishes Annual Volume Cap Report: An Analysis of 2019-2020 Private Activity Bond & Volume Cap Trends
The Council of Development Finance Agencies has published the CDFA Annual Volume Cap Report: An Analysis of 2019-2020 Private Activity Bond and Volume Cap Trends. The CDFA Annual Volume Cap Report provides an overview of volume cap trends and how private activity bonds (PABs) are used from state to state. The 2019-2020 Annual Volume Cap Report is the most comprehensive analysis of PAB volume cap trends and data ever undertaken by CDFA.

Legislative Features

Potential Flexibility in ARP Fiscal Recovery Funds Highlights Importance of Strategic Planning for State and Local Governments
The House is evaluating the State, Local, Tribal, and Territorial Fiscal Recovery, Infrastructure, and Disaster Relief Flexibility Act (Flexibility Act) legislation that the Senate passed on Oct. 19, 2021. If the House approves the current Flexibility Act, it would allow states, tribes, territories and localities to use certain COVID-19 relief funds for new categories of spending, including for natural disasters and new types of infrastructure projects.

House Passes $1.7T Build Back Better Act Containing LIHTC, NHTC, NMTC, Renewable Energy Provisions
On November 19, the U.S. House of Representatives passed the Build Back Better Act, a $1.7 trillion bill that includes an expansion of the low-income housing tax credit (LIHTC), the introduction of the neighborhood homes tax credit (NHTC), an additional tribal allocation of the new markets tax credit (NMTC) and $325 billion in renewable energy tax incentives.

Volume Cap Data Highlights a Need for Legislative Reforms
After reaching an all-time high in 2019, total issuance of private activity bonds appeared to decrease slightly in 2020, though the Council of Development Finance Agencies said the recent data shows that reforms are needed to make issuance more efficient and accessible. Total private activity bond issuance in 2020 dipped to $27.7 billion from $30.5 billion in 2019, according to CDFA's Annual Volume Cap Report released November 5. However, CDFA, which has compiled a yearly report on private activity cap trends for the last 16 years, expects bond issuance to increase steadily as it has over the last decade.

Expansion of Qualified Private Activity Bond Categories Under the Infrastructure Investment and Jobs Act
The Act amends the tax-exempt bond provisions of the Internal Revenue Code (Code) to enhance the financing options available to state and local governments to address the highlighted infrastructure needs. Specifically, the package adds two new categories of exempt facility private activity bonds (PABs) and additional volume cap for transportation PABs.

Nearly 750,000 Affordable Homes, Including LIHTC-financed Homes, At-Risk of Loss by 2031, but Build Back Better Act Would Preserve Many
Every year, thousands of affordable homes are at risk of being lost. However, provisions in the Build Back Better Act (BBBA) could alleviate some of that loss. Many homes at risk of loss can be preserved with new federal funds, such as those in the Build Back Better Act.

LIHTC Provisions Added to Build Back Better Act
Key low-income housing tax credit (LIHTC) provisions were added to the House version of the Build Back Better (BBB) plan in early November after they were left out of the White House's initial framework. The latest House package calls for increasing the 9% LIHTC allocation cap by 10% plus inflation each year from 2022 to 2024 when it will have risen to $3.97 per capita or a small state minimum of about $4.58 million.

Housing Provision in Reconciliation Bill Eases Private Activity Bond Cap
States would enjoy more private activity bond volume flexibility under an affordable housing provision in the Build Back Better bill. The legislation would reduce the so-called financing test for tax-exempt private activity bonds to 25% from 50%. Lowering the threshold would free up states' private activity volume for more affordable housing, or any other projects eligible for PABs financing.

House Agriculture Committee Fact Sheet on Build Back Better Provisions
The agricultural provisions in the Build Back Better plan include billions of dollars for critical investments in agriculture and our rural communities. Included in this package are multiple bipartisan proposals that House Agriculture Committee Members have fought to include. These timely investments will provide resources to mitigate climate change, improve the quality of life in rural communities, and commit millions of dollars to agricultural education across the country.

Preliminary Estimates Show Build Back Better Legislation Will Reduce Deficits
The Build Back Better Act invests meaningfully in American families and workers, while laying the foundation for meeting imperative climate goals. With the release of the text of the Build Back Better Act in the House and scoring from the Joint Committee on Taxation, we can update the estimate of fiscal savings.

Upcoming Events
Intro Property Assessed Clean Energy (PACE) Finance WebCourse

CDFA Federal Financing Webinar Series: Preserving Local Food Systems with Federal Financing
Tuesday, December 14, 2021 - 2:00 PM - 3:30 PM Eastern
During this installment of the CDFA Federal Financing Webinar Series, hear from experts at the USDA about their various programs available for rural food systems and agricultural producers to recover from the pandemic.

Fundamentals of Economic Development Finance Course
January 26-27, 2022 - Daily: 12:00 - 5:00 PM Eastern
CDFA's Fundamentals of Economic Development Finance Course is the foundation for all of CDFA's educational offerings. This course helps attendees understand the variety of development finance tools available, from bonds, tax credits and TIF, to federal financing programs, RLFs, and access to capital lending resources.

Federal Features

Biden-Harris Administration Announces Reforms to Increase Equity for Underserved Small Business Owners
The Biden-Harris Administration is announcing a set of reforms to the federal procurement process to help meet the President's ambitious target of increasing the share of federal contracts to SDBs, advance the President's Management Agenda, and increase opportunity for all underserved businesses.

New National Electric Vehicle Programs Release Requests for Information
As part of the recently passed Infrastructure Investment and Jobs Act, two new electric vehicle programs will receive funds to address climate change by reducing carbon emissions. The National Electric Vehicle Program will provide funding to the States to strategically deploy EV charging infrastructure. In addition, the new law establishes a Charging and Fueling Infrastructure Program.

EPA Invites 39 New Projects to Apply for Water Infrastructure Loans
The U.S. Environmental Protection Agency (EPA) announced that 39 new projects are being invited to apply for Water Infrastructure Finance and Innovation Act (WIFIA) loans and four projects are being added to a waitlist. The agency anticipates that, as funds become available, $6.7 billion in WIFIA loans will help finance over $15 billion in water infrastructure projects to protect public health and water quality across 24 states.

USDA Begins Accepting Applications for $1.15B in Loans and Grants to Help Rural Communities Get High-Speed Internet
USDA Secretary Tom Vilsack announced the Department has begun accepting applications for up to $1.15 billion in loans and grants to help people in rural areas get access to high-speed internet. This announcement comes on the heels of the recently enacted Bipartisan Infrastructure Law, which provides another nearly $2 billion in additional funding for the ReConnect program.

DOE Awards Over $16M for 23 Projects That Will Reduce Carbon Emissions Across the Manufacturing Sector
The U.S. Department of Energy (DOE) and the REMADE Institute announced more than $16 million in research and development funding for 23 projects that will reduce energy use and carbon emissions associated with industrial-scale materials production, processing, and recycling. These projects will advance the technology needed to increase the reuse, remanufacturing, recovery, and recycling of industrial materials.

USDA Invests $222M in Rural Community Infrastructure to Help People in 44 States, Guam, and Puerto Rico
The USDA is investing $222 million to build and improve critical community facilities in 44 states, Guam, Northern Mariana Islands, and Puerto Rico. This community infrastructure funding will benefit nearly 2.5 million people in rural communities. It also includes $132 million to support health care, food security, and emergency response services for more than 850,000 rural residents in 37 states.

HUD Awards $36M for Local Economic and Housing Programs
More than 250 communities will be able to increase the economic impact of their local community development and affordable housing programs with the help of $36 million in "capacity-building" grants awarded by the HUD. The funds will support three national organizations and are ultimately expected to produce approximately 8,000 units of affordable housing nationwide and stimulate nearly $150 million in total investment.

Minority Business Development Agency Permanently Authorized in Infrastructure Deal
U.S. Secretary of Commerce Gina M. Raimondo is pleased to announce that the U.S. Department of Commerce Minority Business Development Agency (MBDA) is made permanent and will be expanded and elevated with the passage of this historic legislation. This action allows the agency to increase its programs and outreach to the Nation's more than 9 million minority-owned businesses.

Treasury Issues State Small Business Credit Initiative Program Implementation Guidance
On November 10, the U.S. Department of the Treasury issued capital program implementation guidance for the State Small Business Credit Initiative (SSBCI) Program. The new version of the program will provide a combined $10 billion to states, the District of Columbia, territories, and Tribal governments to empower small businesses to access capital needed to invest in job-creating opportunities as the country emerges from the pandemic.

Fact Sheet: Bipartisan Infrastructure Deal Boosts Clean Energy Jobs, Strengthens Resilience, Advances Environmental Justice
The White House released this Fact Sheet on the Bipartisan Infrastructure Deal. The Bipartisan Infrastructure Deal passed by Congress will strengthen our nation's resilience to extreme weather and climate change while reducing greenhouse gas emissions, expanding access to clean drinking water, building up a clean power grid, and more.

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 Transportation (DOT)

Emergency Relief (ER) Program
This program, commonly referred to as the emergency relief or ER program, supplements the commitment of resources by States, their political subdivisions, or other Federal agencies to help pay for...

Agency Seal U.S. Dept. of Treasury

Federal Financing Bank - Borrowing Policy
The Secretary of the Treasury purchases obligations issued by the Federal Financing Bank under to provide the financing of Bank purchases of obligations issued, sold, or guaranteed by Federal...

Agency Seal U.S. Environmental Protection Agency (EPA)

Drinking Water State Revolving Fund (DWSRF)
The DWSRF program provides low interest loans to eligible recipients for drinking water infrastructure projects. Under the DWSRF, EPA provides grants to all 50 states plus Puerto Rico to capitalize...

Agency Seal U.S. Small Business Administration (SBA)

Economic Injury Disaster Loan (EIDL)
These loans of up to $2 million help meet financial obligations and operating expenses. Loan advances up to $10,000 are also offered.

Legislative and Federal Headlines

USDA Invests $633M in Climate-Smart and Resilient Infrastructure for People in Rural Communities
USDA | Dec. 3 | Access to Capital | Community Development | Disaster Recovery & Relief | Energy Finance | Federal | Resiliency | Rural Development | U.S. Dept. of Agriculture (USDA)

PAB Limits Fall Short in Addressing Affordable Housing Shortage
The Bond Buyer | Nov. 30 | Bond Finance | Federal | Internal Revenue Service (IRS) | Bond Volume Cap

Reclaiming the Waste: Money May Come to Find, Clean Contaminated Sites
Journal-News | Nov. 29 | Brownfield Financing | Legislative | Redevelopment | State Finance Program

Infrastructure Investment and Jobs Act: Selected Changes Impacting P3s
The National Law Review | Nov. 24 | Bond Finance | Economic Development | Energy Finance | Green Finance | Infrastructure Finance | Legislative | Public-Private Partnership (P3) Financing | Water Finance

Now That Countries Have Made Their Climate Pledges, How Will They Pay for Them?
ABC News | Nov. 24 | Energy Finance | Green Finance | Infrastructure Finance | Legislative | Public-Private Partnership (P3) Financing

USDA Awards $90.2M in Grants to Strengthen Local and Regional Markets for U.S. Agricultural Products
USDA | Nov. 23 | Agriculture Finance | Federal | Food Systems Finance | U.S. Dept. of Agriculture (USDA)

USDA Invests $86M to Improve Equitable Access to Jobs, Education, Health Care and Housing for Rural Communities
USDA | Nov. 22 | Access to Capital | Community Development | Economic Development | Federal | Rural Development | Tribal Finance | U.S. Dept. of Agriculture (USDA)

SBA Announces Updated Guidance Regarding Applicant Deadlines for COVID Economic Injury Disaster Loan Program
U.S. SBA | Nov. 22 | Access to Capital | Disaster Recovery & Relief | Federal | U.S. Small Business Administration (SBA) | COVID-19

Developing WIFIA's Guarantee Capabilities for Taxable Municipal Bonds
Water World | Nov. 20 | Bond Finance | Energy Finance | Green Finance | Infrastructure Finance | Legislative | Water Finance

Corporate Minimum Tax in Build Back Better Faces Opposition
The Bond Buyer | Nov. 17 | Bond Finance | Infrastructure Finance | Legislative

Comprehensive $1.2T Infrastructure Bill to Provide Critical Support for Clean Energy
JD Supra | Nov. 17 | Access to Capital | Energy Finance | Federal | Infrastructure Finance | Revolving Loan Funds (RLFs)

Expansion of Qualified Private Activity Bond Categories Under the Infrastructure Act
Ballard Spahr | Nov. 16 | Bond Finance | Infrastructure Finance | Legislative | Member News

National Rural Housing Coalition Convenes on Housing Advocacy
Yahoo! Finance | Nov. 15 | Housing Finance | Legislative | Rural Development | U.S. Dept. of Agriculture (USDA)

Fact Sheet: Building A New Era of Nation-to-Nation Engagement
The White House | Nov. 15 | Access to Capital | Community Development | Disaster Recovery & Relief | Economic Development | Federal | Food Systems Finance | Tribal Finance

Nearly 1.9M People Could be Affordably Housed as a Result of the Primary LIHTC Unit Financing Provisions of the Nov. 3 BBB Reconciliation Bill
Novogradac | Nov. 9 | Housing Finance | Legislative | Tax Credits

GAO Releases Report on Opportunity Zones and Challenges Facing the IRS
Government Accountability Office | Nov. 8 | Federal | Internal Revenue Service (IRS) | Opportunity Zones

$1T Infrastructure Bill Benefits Valley Ag and Rural Communities
Your Central Valley | Nov. 8 | Agriculture Finance | Infrastructure Finance | Legislative | Rural Development | Water Finance

CDFI Fund Opens CY 2021 NMTC Allocation Round; Application Deadline Jan. 13, 2022
Novogradac | Nov. 5 | Federal | Tax Credits | U.S. Dept. of Treasury CDFI Fund

Governments Must Drastically Improve Efforts to Reduce Emissions
Successful Farming | Nov. 5 | Agriculture Finance | Federal | Food Systems Finance | Incentives | Resiliency

Chairman Neal Says He'll Keep Fighting for Municipal Market in Washington
The Bond Buyer | Nov. 3 | Bond Finance | Infrastructure Finance | Legislative


New Additions to the Online Resource Database

CDFA 2019-2020 Annual Volume Cap Report: An Analysis of Private Activity Bond & Volume Cap Trends
Bond Finance | CDFA Original Research | Housing Finance | Legislative
The CDFA Annual Volume Cap Report provides an overview of volume cap trends and how private activity bonds (PABs) were used from state to state. The 2019-2020 Annual Volume Cap Report is the most comprehensive analysis of PAB volume cap trends and data ever undertaken by CDFA.


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
info@cdfa.net

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CDFA National Sponsors

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  • U.S. Bank
  • Wells Fargo Securities
  • Z. The Bond Buyer
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