Sponsors (3)
The bill redirects more LIHTC support toward transit-proximate, higher-cost areas to produce affordable housing near transit and support transit-oriented development (benefiting low-income renters and encouraging housing supply near transit) while increasing federal costs, risking reduced allocation to rural/non-transit areas, concentrating development geographically, and adding administrative and displacement risks.
Low-income renters and other low-income households near transit will see more affordable housing developed because LIHTC basis and allocations are increased for transit-proximate, higher-cost areas.
Developers and owners (including small developers) gain stronger, more targeted financial incentives to build or rehab housing near transit, likely accelerating transit-oriented development and increasing housing supply.
Residents—especially lower-income residents—may face lower transportation costs and reduced car dependence because more housing will be located within about 1/2 mile of rail, bus, harbor, or waterway stations.
Taxpayers will face higher federal tax expenditures because credits per qualifying project increase and more credits may be concentrated where development is costlier, reducing federal revenue available for other programs.
Rural and lower-cost communities could receive fewer LIHTC credits as allocations shift to higher-cost, transit-rich areas, potentially slowing housing production outside urban transit corridors.
Developers may concentrate projects in the limited designated areas (caps like max 20% of an MSA), leaving other high-need neighborhoods without incentives and worsening geographic inequities in affordable housing access.
Based on analysis of 3 sections of legislative text.
Increases LIHTC eligible basis to 150% (155% in HI/AK/territories) for buildings in HUD- and state-designated transit-oriented areas and requires a HUD study to adjust state LIHTC allocations for transit-based cost differences.
Creates a new tax incentive to steer more affordable housing development near transit by increasing the Low-Income Housing Tax Credit (LIHTC) eligible basis for buildings in HUD- and state-designated transit-oriented development areas, and directs HUD to study cost-of-living differences that reflect transit access to recommend adjustments to state LIHTC allocations. The higher eligible basis (150%, or 155% for Hawaii, Alaska, and U.S. territories) applies to new construction and to rehabilitation expenditures for existing buildings placed in service after enactment.
Official title: To amend the Internal Revenue Code of 1986 to modify the low-income housing tax credit to incentivize affordable and transit-oriented development and development in certain difficult development areas, and for other purposes.
Introduced June 11, 2026 by Ed Case · Last progress June 11, 2026