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BUILDING INDUSTRY ASSOCIATION OBTAINS ADOPTION OF CONGRESSIONAL EXTENSION OF LOW-INCOME HOUSING TAX CREDIT, MORTGAGE REVENUE BONDS

 BUILDING INDUSTRY ASSOCIATION OBTAINS ADOPTION OF CONGRESSIONAL


EXTENSION OF LOW-INCOME HOUSING TAX CREDIT, MORTGAGE REVENUE BONDS
 PHILADELPHIA, Nov. 27 /PRNewswire/ -- The Building Industry Association (BIA) of Philadelphia, an affiliate of the National Association of Home Builders and the Pennsylvania Builders Association, has succeeded in its efforts to obtain adoption by Congress of a Tax Extender Bill which extends 12 economy-stimulating tax provisions that would otherwise have expired on Dec. 31, 1991, including the Low Income Housing Tax Credit, the Mortgage Revenue Bond authority, the Research and Development credit, the targeted jobs credit, and eight other provisions, it was announced today.
 The Senate and House today passed identical bills extending the effective date of these provisions for six months. The bill has now been sent to President Bush for approval.
 These 12 tax provisions allow tax credits or authorize tax exempt financing for various activities which create jobs, construction developments and business activity adding to general economic growth. Though not a cure-all for the current recession, the extension of these 12 provisions will help stimulate economic activity which may assist in ending the nation's continuing recession, the association said.
 On Nov. 4, 1991, the BIA concluded that the then conventional wisdom was correct and that without some serious effort, Congress would not extend the 12 tax provisions, and most importantly to members of the BIA, would allow the Low Income Housing Tax Credit and the Mortgage Revenue Bond authority to terminate. During this depression for the housing industry, such a result appeared unbelievable yet was thought to be the likely outcome. Congressional leaders were then saying that they could not extend the LIHTC and MRB provisions before the end of the year since some members of Congress would load up any extension bill with other favored tax provisions, including capital gains cuts, middle income tax relief, IRA expansion, etc. Not able to deal with those large tax issues in the short time left in the year, Congress members advised the BIA that no extension could be passed by Dec. 31, but extenders would be included in a large tax bill to be considered next year, and the LIHTC and MRB provisions would be made retroactive some time next year. Not content with promises of some action on major tax legislation sometime next year, the BIA mobilized its forces.
 The BIA contacted members of Congress and groups around the country calling for adoption of a Tax Extender Bill which would be uncoupled from all other tax issues. The BIA's strategy, it said, was to cause members of the Senate and House to agree not to permit any amendments to a bill filed to extend the 12 tax provisions. No matter how strongly members felt about other tax issues, including capital gains or middle income tax relief, the BIA asked them to hold those issues until Jan. 25, 1992, and to now only pass a limited extension bill in the short time remaining before Congressional adjournment, then predicted to be Thanksgiving.
 On Nov. 5, 1991, the BIA wrote to U.S. Sens. George Mitchell and Robert Dole, the Democratic and Republican leaders in the Senate, asking them to adopt an agreement limiting debate and prohibiting amendment of any tax extender bill. It also contacted House Ways and Means Chairman Dan Rostenkowski, advising him of the action it sought in the Senate, and requesting that he call up a tax extender bill if the Senate agreed to limit amendment.
 On Nov. 12, 1991, a team of 10 BIA members went to Washington urging Congress to file and pass a Tax Extender Bill subject to the limitation on amendment prohibiting joinder of other tax issues. The BIA met with U.S. Sens. Specter, Biden and Simon and U.S. Reps. Foglietta, Coughlin and Kostmayer and staff members for U.S. Sen. Wofford and Rep. Coyne. Everyone supported the BIA's plan for adoption of a tax extender bill by agreeing in advance to limit amendment. That same day, and agreeing with the BIA strategy, U.S. Sen. Danforth and Reps. Guarini and Vander Jagt filed identical bills in the House and Senate to extend the 12 tax provisions. Though the bills were filed, everyone predicted that Rostenkowski would not permit debate on the bill fearing the addition of other very political and difficult tax issues, the BIA said.
 Specter asked the BIA to provide him with data on the number of jobs and housing units that would be lost if the LIHTC was not extended, and he committed to discussing with Bush that data and the need for the LIHTC. On Nov. 13, 1991, with the help of Rebecca Peace, chief counsel of the Pennsylvania Housing Finance Agency, the BIA obtained and provided to Specter data developed by the National Council of State Housing Finance Agencies showing that the LIHTC had generated 313,662 housing units, 259,882 jobs, $9.7 billion in direct investment, and $28.17 billion in multiplier investment between 1987 and 1990, and that the annualized average of 78,415 housing units, 64,970 jobs, $2.47 billion in direct investment, and $7.04 billion in multiplier investment would be lost if the LIHTC was not extended. In Pennsylvania the LIHTC has generated 10,137 housing units, 8,373 jobs, $317,450,292 in direct investment, and $810,960,000 in multiplier investment.
 The BIA said it felt the data made a compelling case for extension of the LIHTC and so did members of Congress.
 On Nov. 19, 1991, Danforth began circulating a letter calling for adoption of a tax extender bill without permitting amendments, and 75 senators signed within two days. A similar letter was circulated by Foglietta in the Urban Caucus, which he chairs, and by U.S. Rep. Rangel among members of the House Ways and Means Committee.
 A way was found to finance the Tax Extender Bill by requiring large corporations to increase their estimated tax payments from 90 percent to 95 percent to avoid penalties and interest.
 Rostenkowski now called up the Tax Extender Bill (all revenue measures must start in the House) and it was passed by House Ways and Means and Senate Finance on Nov. 25 and then by the full Senate and House on Nov. 27, 1991, and sent to the president.
 The BIA said it is gratified that it could play a major role in urging adoption of the Tax Extender Bill which will be highly beneficial for the entire U.S. economy as well as the Housing Industry.
 For further information, call the BIA legislative director, Harold R. Berk, an attorney with the law firm Pepper, Hamilton & Scheetz, 215-981-4633.
 /delval/
 -0- 11/27/91
 /CONTACT: Harold R. Berk, attorney with Pepper, Hamilton & Scheetz and BIA legislative director, 215-981-4633/ CO: Building Industry Association ST: Pennsylvania IN: REA SU: LEG


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Date:Nov 27, 1991
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