House Votes to Lift LIHPRHA Limits on Accessing Cash Reserves
On July 14, the House passed legislation that provides technical changes to the “Low Income Housing Preservation and Resident Homeownership Act of 1990” (LIHPRHA). The legislation was first enacted to provide multifamily property owners with incentives to maintain affordability for low- and moderate-income renters.
Currently, as part of LIHPRHA, there is a limit placed on an owners’ ability to access a portion of surplus cash in reserves. The bill removes this limitation, encouraging owners to, in part, invest in and extend the useful life of affordable properties.
NAA/NMHC joined with a broad coalition on June 11 in urging the full House to support this legislation. While there isn’t a companion bill in the Senate, we are hopeful that House action will spur the Senate to move forward.
For the past 15 years, HUD has administratively removed limitations on distributions under its authority. However, the department has concluded that it lacks the necessary authority when it comes to the LIHPRHA portfolio. This bill would remove the limitation on distributions and provide the ownership entity with access to its own funds to address tax liabilities – or other expenses while ensuring continued preservation.
Provided by NMHC as part of the NAA/NMHC Joint Legislative Program