S. 3616Senate109th Congress (2005-2007)In Committee

Affordable Housing Preservation Act of 2006

Introduced June 29, 2006

Legislative Activity

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2 earlier actions
SenateIntro Referral Latest Action

Read twice and referred to the Committee on Finance.

June 29, 2006

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SenateIntro Referral

Introduced in Senate

June 29, 2006

SenateIntro Referral

Sponsor introductory remarks on measure. (CR S6802-6803)

June 29, 2006

SenateIntro Referral

Read twice and referred to the Committee on Finance.

June 29, 2006

Floor Debate

18 members

What members said about S. 3616 on the floor

8 Republicans10 Democrats
Barack Obama
Sen. Barack ObamaD-IL · Jun 29, 2006

Mr. President, today, I wish to join my good friend, Senator Bayh, in introducing the Responsible Fatherhood and Healthy Families Act of 2006. This bill addresses a crisis afflicting too many…

Arlen Specter
Sen. Arlen SpecterR-PA · Jun 29, 2006

Mr. President, I have sought recognition to discuss the case of Hamdan v. Rumsfeld which was decided by the Supreme Court of the United States today and to address the question as to where we go from…

Olympia J. Snowe
Sen. Olympia J. SnoweR-ME · Jun 29, 2006

Mr. President, today I am introducing another piece of legislation with Senator Feinstein that addresses the critical issue of the Nation's energy policy, the EXTEND the Energy Efficiency Incentives…

Charles E. Schumer
Sen. Charles E. SchumerD-NY · Jun 29, 2006

Mr. President, today I rise to introduce mine and Senator Gordon Smith's bill, The Affordable Housing Preservation Act of 2006. Our bill provides a solution to preserve federally assisted affordable…

Charles E. Schumer
Sen. Charles E. SchumerD-NY · Jun 29, 2006

Mr. President, today I rise to introduce mine and Senator Gordon Smith's bill, The Affordable Housing Preservation Act of 2006. Our bill provides a solution to preserve federally assisted affordable…

Show 8 more
Jeff Bingaman
Sen. Jeff BingamanD-NM · Jun 29, 2006

Mr. President, I am pleased to introduce legislation today to protect a site of worldwide scientific significance in the Robledo Mountains in New Mexico. The bill, which is cosponsored by my…

Tom Harkin
Sen. Tom HarkinD-IA · Jun 29, 2006

Mr. President, today I am introducing the Agricultural Cooperative Renewable Fuel Stations Act of 2006. This legislation closes a gap in the existing tax incentive for installing alternative…

Herb Kohl
Sen. Herb KohlD-WI · Jun 29, 2006

Mr. President, I rise to introduce the Railroad Antitrust Enforcement Act of 2006. This legislation will eliminate obsolete antitrust exemptions that protect freight railroads from competition. The…

Carl Levin
Sen. Carl LevinD-MI · Jun 29, 2006

Mr. President, I join my colleague, Senator Stabenow, in introducing the Great Lakes Migratory Bird Research and Management Act to learn more about a potential problem regarding double-crested…

John Cornyn
Sen. John CornynR-TX · Jun 29, 2006

Mr. President, I rise today to introduce legislation-- previously introduced in the 108th Congress--which I believe is important to the long-term competitiveness of North America. And I would like to…

Elizabeth Dole
Sen. Elizabeth DoleR-NC · Jun 29, 2006

Mr. President, across North Carolina and our Nation, many local communities face the challenge of what to do with blighted lands where factories and businesses once thrived. Though abandoned, these…

Hillary Rodham Clinton
Sen. Hillary Rodham ClintonD-NY · Jun 29, 2006

Mr. President, I am proud to introduce legislation which would designate the United States Postal Service located at 2951 New York Highway 43 in Averill Park, NY, as the Major George Quamo Post…

Mary L. Landrieu
Sen. Mary L. LandrieuD-LA · Jun 29, 2006

Mr. President, this is a bill that will reduce the estate tax and reform a system that needs to be reformed. It is an issue that many of us have been working on for several--not only several months…

Show 7 more
Harry Reid
Sen. Harry ReidD-NV · Jun 29, 2006

Mr. President, I rise today to reintroduce legislation I originally introduced last Congress, a bill to make air travel safer by allowing local law enforcement to carry their firearms on aircrafts,…

Jim Bunning
Sen. Jim BunningR-KY · Jun 29, 2006

Mr. President, I rise today to introduce a bill to provide for relief from duties on the import of certain parts of motor vehicles. It is my intention that this duty suspension bill will be…

Wayne Allard
Sen. Wayne AllardR-CO · Jun 29, 2006

Mr. President, I rise today on the 100th anniversary of Mesa Verde National Park to offer legislation that would expand the boundary of this national treasure. Mesa Verde is one of our Nation's most…

Gordon H. Smith
Sen. Gordon H. SmithR-OR · Jun 29, 2006

Mr. President, I rise to join Senator Schumer in offering legislation that will help maintain our Nation's affordable housing inventory. Our country's stock of affordable rental housing is shrinking.…

Gordon H. Smith
Sen. Gordon H. SmithR-OR · Jun 29, 2006

Mr. President, I rise to join Senator Schumer in offering legislation that will help maintain our Nation's affordable housing inventory. Our country's stock of affordable rental housing is shrinking.…

Pete V. Domenici
Sen. Pete V. DomeniciR-NM · Jun 29, 2006

Mr. President, the fossilized trackways near the Robledo Mountains in Dona Ana County came to my attention in the early 1990s. During the 101st Congress, I cosponsored Senator Bingaman's legislation…

John D. Rockefeller IV
Sen. John D. Rockefeller IVD-WV · Jun 29, 2006

Mr. President, today, I am introducing legislation to correct an unfair decision that hurts aging, retired VA nurses. This legislation is designed to correct a problem from a bill we passed in 2001,…

Bill Text

Latest available legislative text

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Latest
Introduced in SenateIssued June 29, 2006

II

109th CONGRESS

2d Session

S. 3616

IN THE SENATE OF THE UNITED STATES

June 29, 2006

Mr. Schumer (for himself, Mr. Smith, Mr. Bond, Mr. Reed, Mrs. Murray, and Mr. Sarbanes) introduced the following bill; which was read twice and referred to the Committee on Finance

A BILL

To amend the Internal Revenue Code of 1986 to provide an incentive to preserve affordable housing in multifamily housing units which are sold or exchanged.

1.

Short title

This Act may be cited as the Affordable Housing Preservation Act of 2006.

2.

Exclusion of gain from sales of affordable housing which is attributable to depreciation

(a)

In general

Part I of subchapter P of chapter 1 of the Internal Revenue Code of 1986 (relating to treatment of capital gains) is amended by inserting after section 1202 the following new section:

1203.

Exclusion of gain from qualified sales of multifamily housing

(a)

In general

Gross income shall not include gain from the qualified sale or exchange of eligible multifamily housing property.

(b)

Exclusion limited to depreciation

The amount of gain excluded from gross income under subsection (a) with respect to any property shall not exceed the depreciation adjustments (as defined in section 1250(b)(3)) in respect of such property.

(c)

Qualified sale or exchange

For purposes of this section—

(1)

In general

The term qualified sale or exchange means a sale of eligible multifamily housing property to or an exchange of such property with a preservation entity which agrees to maintain affordability and use restrictions regarding the property that are—

(A)

for a term of not less than the extended use period,

(B)

legally enforceable, and

(C)

consistent with the requirements of paragraph (2).

Such restrictions shall be binding on all successors of the preservation entity and shall be recorded as a restrictive covenant on the property pursuant to State law.
(2)

Affordability and use restrictions

(A)

In general

Affordability and use restrictions regarding a property are consistent with this paragraph if—

(i)

in the case of property with respect to which assistance described in subsection (d) is still in effect (as determined by the Secretary), such property satisfies the affordability and use restrictions in connection with such assistance, or

(ii)

in the case of any other property, such property is maintained as affordable housing.

(B)

Affordable housing

The term affordable housing means housing which would be a qualified low-income housing project (as defined in section 42(g)) if subparagraph (A) of section 42(g)(1) did not apply and subparagraph (B) of such section were applied by substituting 51 percent for 40 percent. Eligible multifamily housing property shall not fail to be treated as affordable housing solely because residents of such property (while such property was described in subparagraph (A)(i)) continue to reside in such property.

(3)

Certification by program administrator

The term qualified sale or exchange shall not include any sale or exchange of property unless the housing agency certifies—

(A)

that the transferee with respect to such property is a qualified preservation entity,

(B)

that affordability and use restrictions will be maintained with respect to such property during the extended use period,

(C)

that new capital will be expended that restores the condition of the property and funds adequate reserves, and

(D)

the amount of gain which the transferor will be allowed to exclude from gross income under subsection (a) (determined at the entity level in the case of a partnership or S corporation).

(4)

Extended use period

The term extended use period means the period beginning on the date of sale and ending on the earlier of—

(A)

30 years after the close of the sale, or

(B)

the date that the property is acquired by foreclosure (or instrument in lieu of foreclosure).

Subparagraph (B) shall not apply if the Secretary determines that the acquisition described therein is part of an arrangement with the owner a purpose of which is to terminate the extended use period.
(d)

Eligible multifamily housing property

For purposes of this section, the term eligible multifamily housing property means any section 1250 property (as defined in section 1250(c))—

(1)

which is assisted under section 221(d)(3) or section 236 of the National Housing Act (or financed or assisted by direct loan or tax abatement under similar provisions of State or local laws) and with respect to which the owner is subject to the restrictions described in section 1039(b)(1)(B) (as in effect on the day before the date of the enactment of the Revenue Reconciliation Act of 1990),

(2)

which is described in section 512(2)(B) of the Multifamily Assisted Housing Reform and Affordability Act of 1997 (42 U.S.C. 1437f note), or

(3)

with respect to which a loan is made or insured under title V of the Housing Act of 1949.

Such term does not include any property with respect to which a credit under section 42 was allowed to the taxpayer.
(e)

Preservation entity

For purposes of this section, the term preservation entity means a housing agency or an organization approved by a housing agency that has the capacity and commitment to successfully acquire and preserve eligible multifamily housing property. An organization shall not be treated as a preservation entity with respect to any taxpayer if such organization is related (as defined in section 267) to such taxpayer.

(f)

Responsibilities of housing agency

The housing agency (or an agent or other private contractor of such agency) shall—

(1)

determine whether the preservation entity’s plan for rehabilitation and operation restores the condition of the eligible multifamily housing property and is viable for no less than 30 years,

(2)

monitor the affordability and use restrictions for the eligible multifamily housing property, and

(3)

notify the Internal Revenue Service as to any portion of such property which is out of compliance.

(g)

Recapture for noncompliance

If the Secretary determines that all or a portion of the multifamily housing property acquired by a preservation entity in a transfer to which subsection (a) applied is out of compliance with the requirements of this section, the preservation entity’s tax imposed under this chapter for the taxable year shall be increased by (or if such entity is not otherwise subject to tax under this chapter, there shall be imposed on such entity a tax equal to) 12.5 percent of the amount which bears the same ratio to the amount certified under subsection (c)(3)(C) with respect to such property as such entity’s share of the portion of such property which is out of compliance bears to the entire property. The amount otherwise determined under this subsection (without regard to this sentence) shall be reduced by the product of 3.33 percent of such amount, multiplied by the number of years after the qualified sale or exchange that the property was in compliance with the requirements of this section.

(h)

Coordination with section 1250

In the case of a qualified sale or exchange of eligible multifamily housing property a portion of the gain from which is treated as ordinary income under section 1250, such portion of the gain shall be excluded from gross income under subsection (a) before any remaining portion of such gain.

(i)

Housing agency

For purposes of this section, the term housing agency means, with respect to any eligible multifamily housing property, the State housing agency (or in the absence of a State housing agency, any Federal housing agency) which administers housing assistance with respect to such property.

.

(b)

Conforming amendments

(1)

Subparagraph (B) of section 172(d)(2) of the Internal Revenue Code of 1986 is amended by striking section 1202 and inserting section 1202 and 1203.

(2)

Paragraph (4) of section 642(c) of such Code is amended by striking the first sentence and inserting the following: To the extent that the amount otherwise allowable as a deduction under this subsection consists of gain described in section 1202(a) or 1203(a)), proper adjustment shall be made for any exclusion allowable to the estate or trust under section 1202 or section 1203, as the case may be..

(3)

Paragraph (3) of section 643(a) of such Code is amended by striking section 1202 and inserting sections 1202 and 1203.

(4)

Paragraph (4) of section 691(c) of such Code is amended by inserting 1203, after 1202,.

(5)

Paragraph (2) of section 871(a) of such Code is amended by inserting and 1203 after section 1202.

(6)

The table of sections for part I of subchapter P of chapter 1 of such Code is amended by inserting after the item relating to section 1202 the following new item:

.

(c)

Effective date

The amendments made by this section shall apply to taxable years beginning after December 31, 2005.