Grass-Roots Survival Tactics: LIHTC Program Participants Give Tips for Effective Advocacy in the New Congress

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The stakes for tax credit advocates couldn’t be higher when the new 113th Congress convenes in January.

With lawmakers expected to write tax reform legislation, advocates of current federal tax credits benefiting American families and communities – the low-income housing tax credit, new markets tax credit, historic rehabilitation tax credit, and renewable energy tax credit – will be challenged to present their best arguments and evidence as to why these incentives should be kept as is in the tax code and not curtailed.

So what makes for effective advocacy? And what should advocates do?

In recent interviews, LIHTC industry officials offered advice for effective grass-roots advocacy by program participants to build a firewall of support for the housing credit in Congress. These recommendations are useful for advocates of the other tax credits as well though the message may differ.

Tax Reform on Horizon

Tax reform legislation appears highly likely in 2013, with President Obama and many Congressional leaders favoring this. And if tax reform means finding a revenue-neutral way to slash the corporate tax rate, say from 35% to 28% or 25%, a whole host of current corporate tax incentives and tax breaks will have to be eliminated or scaled back to pay for the rate cuts.

“The way you could lower rates is to eliminate or reduce a number of tax expenditures, of which the low-income housing tax credit is one,” says Washington, D.C. Richard Goldstein, a partner at Nixon Peabody LLP and counsel to the Affordable Housing Tax Credit Coalition. “So we’re not going to be immune from being looked at. And we’re not going to be immune from the pressure to eliminate or potentially reduce the housing credit in an effort to lower rates. We will be on the table with lots of other items.”

“I think everything is vulnerable,” warns Barbara Thompson, Executive Director of the National Council of State Housing Agencies. “It [LIHTC] is not an inexpensive program. So in the hunt for revenue it stands out.”

Don’t Take Support for Granted

The LIHTC program has had deep bipartisan support in Congress to date. In addition to the fact that it is a “permanent” program, one sign is the large number of co-sponsors – 24 in the Senate and 86 in the House – of bills introduced in the recent 112th Congress (S. 1989, H.R. 3661) to make the minimum 9% credit rate permanent and to establish a minimum 4% credit rate for non-bond financed acquisition costs.

Nonetheless, lobbyists say advocates can’t be complacent and take Congressional support for granted in 2013. “We could well have a situation where people support the credit but they have to come to a decision that we as a country can’t afford it,” warns Thompson.

“You’re going to need Members of Congress to stick their necks out and say, ‘Not only do I support this program, but I do not think it should be affected by tax reform,’” says Peter Lawrence, Senior Director of Public Policy and Government Affairs at Enterprise Community Partners.

Advocates will also have to hit the ground fast and early in the new Congress to educate the many new members – 12 in the Senate and around 85 in the House – about the LIHTC program: what it is and does, how it works, the benefits provided, and the actual LIHTC properties in the Member’s district or state.

Advice for Effective Advocacy

LIHTC industry officials offered the following advice to program participants on how they can effectively advocate for the housing credit with Members of Congress:

  • Build Relationships. The foundation is building trusted relationships with Representatives, Senators, and their staffs. This means get-acquainted and ongoing meetings by advocates with lawmakers and/or their aides in their Washington or district/state offices, inviting them to LIHTC site events, supporting political fundraisers, etc. Developer Bob Greer, President of Michaels Development Co., Marlton, N.J., prefers meeting Members in their district office. “They’re more relaxed, have more time, and are more open to listen,” he notes. “When I meet them on the Hill, if they give you 10 minutes that’s a lot.”
  • Hold Site Events. “We invite elected officials to all of our [project] ribbon-cuttings and groundbreakings to share the message of the low-income housing tax credit and share with them who lives in the community,” says developer J. David Heller, a principal of Cleveland-based NRP Group. The company invites the two U.S. Senators, the Representative for that district, their staffs, state and local elected officials, the project subcontractors, residents, and others. Just in the past year, NRP Group has succeeded in getting five Congressmen and two Congressmen-elect from Texas to attend ribbon-cutting ceremonies at new NRP tax credit properties. “There’s nothing as effective as getting Members out to see these properties,” says Goldstein. “It has a real impact when they see the way in which these properties are changing communities, changing the residents’ lives, and creating jobs.” Members get to speak at site events, take credit for the development, meet residents, network with constituents, and see the positive results of the LIHTC program firsthand. Heller says it’s also vital to invite staff members of Representatives and Senators and “treat them with the same respect and dignity as the Member. We’ve trained our staff to be just as happy having the staff members from the Congressional offices and doing the outreach and advocacy with them.”
  • Get Creative. Project groundbreakings and ribbon-cuttings aren’t the only possible site events. Says Lawrence, “If it’s under construction, a hardhat tour. If it’s already up and running, you can have an issues forum in one of the building’s common areas. If there are a decent number of constituents that the Member believes will show up for an event, they will come.” Many Members are home in their districts on the weekends, Monday mornings, and Friday afternoons.
  • Cultivate Future Members. NRP Group also invites elected state and local officials to its site events: state representatives, state senators, the Governor, the mayor, and city council members. “In many cases that’s your feeder pool to Congress,” says Heller, noting many Members of Congress were once elected state and local officials.
  • All Hands on Board. Grass-roots advocacy needs to be done by all types of LIHTC program participants: developers; contractors; subcontractors; funders; nonprofit organizations; resident groups; low-income advocates; housing agencies; and others. “This is not something that can just be done by a handful of lobbyists in Washington,” says Goldstein.
  • The Right Message. Conveying an effective message to Representatives, Senators, and their staffs is huge. The message is that the LIHTC provides much-needed affordable and safe rental housing that improves the lives of residents; creates jobs and other financial benefits for localities [one industry estimate is 116 construction jobs for a 100-unit project]; revitalizes neighborhoods; has an excellent track record; is efficient; and utilizes public-private partnerships. Many trade and membership organizations have standard fact sheets or summaries that advocates can use or draw from. Photos of properties and residents and resident testimonials are valuable as well. Thompson says advocates should understand where the particular Member “is coming from” before meeting him or her, to be able to “appropriately hone the message” to present the facts and arguments that will resonate best with that Member (e.g., job creation, affordable housing).
  • Don’t Fudge the Facts. “The worst thing you can do is not be factually accurate or untruthful,” says Goldstein, once a House staff member. “That’s the quickest way to find yourself persona non grata. You’ve got to make sure that you’re factually correct and well-prepared.”
  • Have a Plan and Work the Plan. Bob Greer and Michaels Development Co. have created a highly successful formal process that they religiously follow to build support among Members and to get them out to project site events.
  • Remember Your Manners. Lastly, no one ever went wrong sending a thank-you note to a Member or staff person after meeting them or having them attend a site event. It’s just common courtesy.

Valuable Tax Credit Advocacy Resources

Affordable Rental Housing ACTION
http://www.rentalhousingaction.org

Housing Advisory Group
http://www.bostoncapital.com/about/hag.html

National Housing & Rehabilitation Association
http://www.housingonline.com/Advocacy.aspx

Historic Tax Credit Coalition
http://historiccredit.com

New Markets Tax Credit Coalition
http://nmtccoalition.org