Bill Seeks to Change Student Rule for LIHTC Properties

On Oct. 3, House Ways and Means Committee member Jim McDermott (D-WA) introduced legislation, H.R. 3076, that would amend the Housing Credit to make formerly homeless youth who are students eligible for Housing Credit-financed housing.

Current law generally doesn't permit full-time students to access developments financed with LIHTC credits to prevent the program's scarce resources from being used to construct dormitories and to prevent college students with temporarily low incomes from benefitting from a resource meant for low-income individuals and families. This “student rule” already contains exceptions for specific categories of persons, including former foster youth, single parents, and parents receiving public assistance.

The bill would create an additional exception for “a student who previously was a homeless child or youth as defined by section 725 of the McKinney-Vento Homeless Assistance Act,” allowing these individuals to get an education while living in an LIHTC property.

The Joint Committee on Taxation estimates the bill would cost less than $1 million over 10 years. The legislation would become effective immediately upon enactment and would apply to determinations made before, on, or after the date of enactment. The bill has been referred to the House Ways and Means Committee for further action. There's currently no companion legislation in the Senate.