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2 The Washington Report MODERATOR Michael Novogradac Novogradac & Company PANELISTS David Gasson Boston Orlando Cabrera Arnall Golden Gregory Emily Cadik Affordable Housing Tax Credit

3 Agenda Election Results Lame Duck To-Dos Extenders/Permanency Legislation Looking Ahead to

4 Election Results

5 D R

6 A Look at the Senate Races 115 th Congress 50 seats needed 2I 47 Democrats 51 Republicans

7 A Look at the Senate Races Contested seats needed 2I safe 23, no 2018 election 20 safe D , no 2018 election safe R 7D 5R

8 Key Senate Race Results State Democratic Candidate Republican Candidate Result Arizona (open) Florida Indiana Mississippi Missouri Montana Nevada New Jersey North Dakota Tennessee (open) Texas West Virginia Rep. Kyrsten Sinema Sen. Bill Nelson (incumbent) Sen. Joe Donnelly (incumbent) Former Rep. Mike Espy Sen. Claire McCaskill (incumbent) Sen. Jon Tester (incumbent) Rep. Jacky Rosen Sen. Bob Menendez (incumbent) Sen. Heidi Heitkamp (incumbent) Former Gov. Phil Bredesen Rep. Beto O Rourke Sen. Joe Manchin (incumbent) Rep. Martha McSally Gov. Rick Scott Mike Braun Sen. Cindy Hyde-Smith (incumbent) Josh Hawley Matt Rosendale Sen. Dean Heller (incumbent) Bob Hugin Rep. Kevin Cramer Rep. Marsha Blackburn Sen. Ted Cruz (incumbent) Patrick Morrisey

9 Key Senate Race Results State Democratic Candidate Republican Candidate Result Arizona (open) Florida Indiana Mississippi Missouri Montana Nevada New Jersey North Dakota Tennessee (open) Texas West Virginia Rep. Kyrsten Sinema Sen. Bill Nelson (incumbent) Sen. Joe Donnelly (incumbent) Former Rep. Mike Espy Sen. Claire McCaskill (incumbent) Sen. Jon Tester (incumbent) Rep. Jacky Rosen Sen. Bob Menendez (incumbent) Sen. Heidi Heitkamp (incumbent) Former Gov. Phil Bredesen Rep. Beto O Rourke Sen. Joe Manchin (incumbent) Rep. Martha McSally Gov. Rick Senate Scott Finance Mike Braun Committee Members Sen. Cindy Hyde-Smith (incumbent) Josh Hawley Matt Rosendale Sen. Dean Heller (incumbent) Bob Hugin Rep. Kevin Cramer Rep. Marsha Blackburn Sen. Ted Cruz (incumbent) Patrick Morrisey

10 Key Senate Race Results State Arizona (open) Florida Indiana Mississippi Missouri Montana Nevada New Jersey North Dakota Tennessee (open) Texas West Virginia Democratic Candidate Rep. Kyrsten Sinema Sen. Bill Nelson (incumbent) Sen. Joe Donnelly (incumbent) Former Rep. Mike Espy Sen. Claire McCaskill (incumbent) Sen. Jon Tester (incumbent) Rep. Jacky Rosen Sen. Bob Menendez (incumbent) Sen. Heidi Heitkamp (incumbent) Former Gov. Phil Bredesen Rep. Beto O Rourke Sen. Joe Manchin (incumbent) Republican Candidate Rep. Martha McSally Gov. Rick Scott Mike Braun Sen. Cindy Hyde-Smith (incumbent) Josh Hawley Matt Rosendale Sen. Dean Heller (incumbent) Bob Hugin Rep. Kevin Cramer Rep. Marsha Blackburn Sen. Ted Cruz (incumbent) Patrick Morrisey Result Sinema (flip) Scott (flip) Braun (flip) Hyde-Smith Hawley (flip) Tester Rosen (flip) Menendez Cramer (flip) Blackburn Cruz Manchin

11 A Look at the Senate Races Results 45 Democrats 2 Independents 53 Republicans

Senate Finance Committee Roster DEMOCRATS Ron Wyden, OR, Ranking Member Debbie Stabenow, MI Sherrod Brown, OH Maria Cantwell, WA Michael Bennet, CO Bill

Hatch, UT, Chairman Chuck Grassley, IA, Chairman Mike Crapo, ID Pat Roberts, KS Mike Enzi, WY John Cornyn, TX John Thune, SD Richard Burr, NC Johnny

12 Senate Finance Committee Roster DEMOCRATS Ron Wyden, OR, Ranking Member Debbie Stabenow, MI Sherrod Brown, OH Maria Cantwell, WA Michael Bennet, CO Bill Nelson, FL Bob Casey, PA Bob Menendez, NJ Mark Warner, VA Tom Carper, DE Claire McCaskill, MO Ben Cardin, MD Sheldon Whitehouse, RI REPUBLICANS Orrin Hatch, UT, Chairman Chuck Grassley, IA, Chairman Mike Crapo, ID Pat Roberts, KS Mike Enzi, WY John Cornyn, TX John Thune, SD Richard Burr, NC Johnny Isakson, GA Rob Portman, OH Pat Toomey, PA Dean Heller, NV Tim Scott, SC Bill Cassidy, LA POTENTIAL ADDITION: Amy Klobuchar D Minn. POTENTIAL ADDITION: Todd Young R Ind.

13 A Look at the House Races 115 th Congress 218 seats needed 193 Democrats 235 Republicans 7 vacant seats Slaughter (NY) Conyers (MI) Jenkins (WV) DeSantis (FL) Dent (PA) Meehan (PA) Bridenstine (OK)

14 A Look at the House Races 115 th Congress 218 seats needed 196 Safe/Likely D Safe/Likely R 16 lean D 1D 26R 24 lean R

15 A Look at the House Races Results 234 Democrats 0 Independents 200 Republicans 1 California 21 (D Leading) Undecided

16 House Ways and Means Committee Roster DEMOCRATS (24) Richard Neal, MA, Chairman John Lewis, GA Suzan DelBene, WA Lloyd Doggett, TX Judy Chu, CA Mike Thompson, CA John B. Larson, CT Earl Blumenauer, OR Ron Kind, WI Bill Pascrell, NJ Danny K. Davis, IL Linda Sánchez, CA Brian Higgins, NY Terri Sewell, AL REPUBLICANS (16) Kevin Brady, TX, Ranking Member Devin Nunes, CA George Holding, NC Peter Roskam, IL Jason T. Smith, MO Vern Buchanan, FL Tom Rice, SC Adrian Smith, NE David Schweikert, AZ Erik Paulsen, MN Jackie Walorski, IN Kenny Marchant, TX Carlos Curbelo, FL Tom Reed, NY Mike Bishop, MI Mike Kelly, PA Darin LaHood, IL Brad Wenstrup, OH

17 Potential Additions to the House Committee on Ways and Means DEMOCRATS REPUBLICANS Rep. Fudge D Ohio Rep. Kildee D Mich. Rep. Richmond D La. Rep. Jeffries D N.Y. Rep. Arrington R Tex. Rep. Ferguson R Ga.

18 House and Senate Leadership Sen. McConnell Maj. Leader R - Kentucky Sen. Schumer Min. Leader D - New York Sen. Thune Maj. Whip R - South Dakota Sen. Durbin Min. Whip D - Illinois Rep. Pelosi Speaker D - California Rep. Hoyer Maj. Leader D - Maryland Rep. McCarthy Min. Leader R - California Rep. Clyburn Maj. Whip D - South Carolina Rep. Scalise Min. Whip R - Louisiana

19 Senate Committee Leadership FINANCE JUDICIARY BANKING, HOUSING & APPROPRIATIONS URBAN AFFAIRS THUD SEN. GRASSLEY Chair of Finance R-Iowa SEN. GRAHAM Chair of Judiciary R-South Carolina SEN. SHELBY Chair of Appropriations R-Alabama SEN. CRAPO Chair of Banking R-Idaho SEN. COLLINS Chair of THUD Subcommittee R-Maine

20 House Committee Leadership W&M FINANCIAL SERVICES APPROPRIATIONS THUD REP. NEAL Chair of Ways & Means D-Mass. REP. WATERS Chair of Financial Services D-Calif. REP. LOWEY Chair of Appropriations D-N.Y. REP. PRICE THUD Subcommittee D-N.C.

com/blog for a quick-take post Tune into the Tax Credit

com/podcast Look for our most in-depth analysis in the

21 Want more analysis? Check out Notes from Novogradac at for a quick-take post Tune into the Tax Credit Tuesday Special Election Edition podcast found at ww.novoco.com/podcast Look for our most in-depth analysis in the Washington Wire and 3. Policy Points sections of the December issue of the Journal of Tax Credits

22 Turnover in the House and Senate THE NEED FOR EDUCATION

Incoming Congress January 2019 45 DEMOCRATS 2

23 Incoming Congress January DEMOCRATS 2 INDEPENDENTS 53 REPUBLICANS 234 DEMOCRATS 200 REPUBLICANS 1 undecided

24 Who has been in office since January 1, 2013? 39 DEMOCRATS 76% of Senate 71% of Congress 70% of House 2 INDEPENDENT 35 REPUBLICANS 151 DEMOCRATS 153 REPUBLICANS

25 Advocacy Resources

29 What to Expect?

30 What To Expect? NOV. 13 House and Senate back in session NOV. 28 D caucus vote TODAY DEC. 7 CR Expires DEC. 13 House adjourns DEC. 14 Senate adjourns JAN TH Congress JAN. 3 Election for Speaker of the House JAN. 22 FEB. 12 State of the Union NOV DEC JAN FEB

31 What To Expect? NOV. 13 DEC. 7 Extenders House and Senate back Tax in Reform session2.0 Tax Reform technical corrections TODAY Dec. 7 th funding bill potential vehicles LAME DUCK TO-DOs CR Expires DEC. 13 House adjourns DEC. 14 Senate adjourns JAN TH Congress JAN. 3 Election for Speaker of the House JAN. 22 FEB. 12 State of the Union NOV DEC JAN FEB

32 More LIHTCs via Affordable Housing Credit Improvement Act As of 11/27/ Ds, 2Is, 11Rs 99Ds, 83Rs? 50 percent increase CANTWELL HATCH Incomeaveraging + about 20 other provisions? Minimum 4 percent rate NEAL CURBELO

33 More LIHTCs via Affordable Housing Credit Improvement Act As of 11/27/2018 Projected Increase in Affordable Rental Homes Due to 50% LIHTC (9 Percent) Allocation Increase 31Ds, 2Is, 11Rs 100,000 90,000 Status Quo Projected 9% Units FY18 omnibus temporary 12.5% allocation increase Assumed 12.5% allocation increase is made permanent 50% increase 50 percent 264,000 additional homes over 10 years increase 99Ds, 83Rs Rental Homes 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000 0 CANTWELL NEAL HATCH CURBELO Incomeaveraging Minimum 4 percent rate + about 20 other provisions ,300 homes

More LIHTCs via Affordable Housing Credit Improvement Act As of 11/27/2018 Projected Increase in Affordable Rental Homes Due to 50% LIHTC (9 Percent) Allocation Increase 31Ds, 2Is, 11Rs 100,000

34 More LIHTCs via Affordable Housing Credit Improvement Act As of 11/27/2018 Projected Increase in Affordable Rental Homes Due to 50% LIHTC (9 Percent) Allocation Increase 31Ds, 2Is, 11Rs 100,000 90,000 Status Quo Projected 9% Units FY18 omnibus temporary 12.5% allocation increase Assumed 12.5% allocation increase is made permanent 50% increase 50 percent 264,000 additional homes over 10 years increase 99Ds, 83Rs Rental Homes 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000 0 CANTWELL NEAL HATCH CURBELO Incomeaveraging Minimum 4 percent rate + about 20 other provisions ,300 homes

35 More LIHTCs via Affordable Housing Credit Improvement Act As of 11/27/ Ds, 2Is, 11Rs 50 percent increase 99Ds, 83Rs CANTWELL HATCH Incomeaveraging + about 20 other provisions Minimum 4 percent rate NEAL CURBELO

More LIHTCs via Affordable Housing Credit Improvement Act As of 11/27/2018 Projected Increase in Affordable Rental Homes Due to Minimum 4 Percent Rate 31Ds, 2Is, 11Rs Note these assumptions: Assumed

36 More LIHTCs via Affordable Housing Credit Improvement Act As of 11/27/2018 Projected Increase in Affordable Rental Homes Due to Minimum 4 Percent Rate 31Ds, 2Is, 11Rs Note these assumptions: Assumed that states will increase their tax-exempt bond issuance for multifamily Assumed 99Ds, 83Rs the absolute amount of soft subsidies going to tax exempt bond properties would remain unchanged To the extent that there is less deferred developer fee, that is offset with more taxable bond financing CANTWELL NEAL Rental Homes 90,000 88,000 86,000 84,000 82,000 HATCH 80,000 78,000 76,000 74,000 72,000 CURBELO Status Quo Projected 4% Units 77,700 65,500 additional homes over 10 years 50 percent increase Incomeaveraging Minimum 4 percent rate 4% Floor (Additional Units) + about 20 other provisions 81,

37 Potential House Ways and Means Infrastructure Subcommittee What about Possible Chair Earl Blumenauer D-Oregon next year?

38 INFRASTRUCTURE What about next year?

39 HUD Budget

40 HUD Budget* Note: amounts in millions FY17 Enacted FY18 Enacted President s FY19 Request House FY2019 Bill Senate FY2019 Bill % Change FY18 FY17 % Change FY19 Req. FY18 Housing Choice Vouchers $20,292 $22,015 $20,550 $22,476 $22, % -6.7% Project-Based Section 8 $10,816 $11,515 $11,047 $11,747 $11, % -3.2% Public Housing Operating Fund $4,400 $4,550 $3,279 $4,550 $4, % -27.9% Public Housing Capital Fund $1,942 $2,750 $0 $2,750 $2, % -100% Section 202 $502 $678 $601 $678 $ % -11.4% Section 811 $146 $230 $140 $154 $ % -39.0% HOPWA $356 $375 $330 $393 $ % -12.0% CDBG $3,000 $3,235 $0 $3,300 $3, % -100% HOME $950 $1,362 $0 $1,200 $1, % -100% Homeless Assistance $2,383 $2,513 $2,383 $2,546 $2, % -5.2% Choice Neighborhood Initiative $138 $150 -$137 $150 $ % % Overall (gross) $48,055 $52,748 $41,240 $53,188 $54, % -21.8% *Currently operating under a Continuing Resolution through December 7th

41 Change at the FHFA Mel Watt ends his term the first week of January No permanent replacement identified Important Policy Direction GSEs Housing Trust Fund Capital Magnet Fund Join us tomorrow for more on CRA and the future of FHFA

42 Areas of Possible Contention Between the House And Senate Section 8 Reform RAD Expansion Public Housing Reform Moving to Work GSEs and Conservatorships

43 Questions? MODERATOR Michael Novogradac Novogradac & Company PANELISTS David Gasson Boston Orlando Cabrera Arnall Golden Gregory Emily Cadik Affordable Housing Tax Credit

Washington Report. Michael Novogradac Novogradac & Company Shannon Ross Housing Partnership Network

Washington Report. Michael Novogradac Novogradac & Company Shannon Ross Housing Partnership Network Washington Report PANELISTS Michael Novogradac Novogradac & Company LLP @Novogradac Michael Gaber WNC & Associates, Inc. Shannon Ross Housing Partnership Network Orlando Cabrera Arnall Golden Gregory Agenda