Senator Maria Cantwell (D-WA) introduced legislation that would make the 9% low income housing tax credit’s (LIHTC) fixed floor rate permanent for new construction and substantial rehabilitation projects, and establish a similar fixed floor rate for the 4% credit for acquisition projects. The bill, S. 1442, was introduced on August 1. A minimum tax credit rate for the 9% credit was included in the 2008 Housing and Economic Recovery Act but will expire for apartments placed in service after the end of 2013. January’s American Taxpayer Relief Act extended this sunset by providing the credit floor for projects allocated tax credits by the end of 2013. As enacted in the Tax Reform Act of 1986, the amount of LIHTCs that are awarded to development projects is based on a formula that uses the federal cost of borrowing to determine the credit rate. As the cost of borrowing declines, the amount of LIHTCs also declines. This bill establishes a minimum credit amount that LIHTC developments would receive, protecting them from reductions in investor equity used to build affordable housing.The bill was referred to the Senate Committee on Finance.