Affordable Housing Construction Act

For calendar years beginning after 2026, the state ceiling rises from $1.75 to $9.79 per resident, with the minimum increasing from $2 million to $11.34 million. The amounts are adjusted for inflation for calendar years after 2027.

For qualifying buildings, the bill increases the basis used to calculate credits by 50% for prevailing-wage or extremely-low-income projects, 25% for projects near public transportation, and an amount tied to renewable-energy use or accessible units. A housing credit agency must find an increase is needed for financial feasibility, and combined increases cannot raise the eligible basis or rehabilitation expenditures above 250% of the amount before the increases.

At least one-third of each state's housing credit ceiling must go to projects meeting one or more of the bill's criteria for prevailing wages, renewable energy, public transportation access, disability-accessible units, or extremely low-income households. States cannot waive this set-aside.

For qualifying tax-exempt bond issues dated before January 1, 2028, the share of a project's basis that must be financed with bonds falls from 25% to 15% for buildings placed in service in taxable years beginning after December 31, 2025.

For agreements entered into in taxable years beginning after enactment, the specified period in the extended-use rules increases from 15 years to 35 years.

Buildings that receive a housing credit allocation before January 1, 2027, and certain bond-financed buildings that received a qualifying determination before that date retain the option. The bill removes it for other buildings and changes how fair market value is determined for existing projects.