FIXER Act
- Sponsor
- Rep. Goldman, Daniel S. [D-NY-10]
- Committees
- Ways and Means Committee (primary)
- Last action
- Jul 23, 2026
Bottom line
The FIXER Act aims to boost the rehabilitation and preservation of affordable housing by removing a federal volume cap limitation on tax-exempt bond financing for such projects.
What it actually does
This bill amends the Internal Revenue Code of 1986 to create an elective exception from the state volume cap on tax-exempt bonds for certain exempt facility bonds used in qualified residential rental projects. Specifically, it targets projects that preserve, improve, or replace existing low-income, federally assisted, or state-assisted housing. It also adjusts the rules for acquiring existing property with these bonds and ensures compatibility with Low-Income Housing Tax Credits.
Proponents argue
Proponents argue that this bill provides a crucial tool for state and local governments to finance the preservation and rehabilitation of aging affordable housing stock. They contend that the existing volume cap often restricts necessary upgrades, and this legislation will help maintain quality housing for low-income residents, prevent displacement, and leverage private investment for public good.
Opponents contend
Opponents might argue that expanding exceptions to the volume cap on tax-exempt bonds could lead to increased federal revenue loss without sufficient guarantees that the benefits will primarily accrue to low-income residents. They may also express concerns that the expanded financing options could inadvertently benefit developers or investors more than the intended beneficiaries.
The bill is concise and focused, allowing an informed reader to grasp its core provisions and implications within a few minutes.
Section 2(a), adding new subsection (o) to Section 146 of the Internal Revenue Code of 1986.
Elective Exception from Volume Cap for Qualified Residential Rental Projects
This provision allows state and local governments (issuing authorities) to choose to exempt certain tax-exempt bonds from their annual state volume cap. These bonds must be used for qualified residential rental projects, specifically for preserving, improving, or replacing existing low-income housing tax credit properties (after their initial compliance period), federally assisted buildings, or state-assisted buildings.
Supporters argue
Supporters argue this exception is crucial for addressing the aging affordable housing infrastructure, allowing states to finance necessary repairs and upgrades without depleting their general volume cap, which is often oversubscribed. This directly supports the preservation of existing affordable units.
Critics contend
Critics might contend that this exception could reduce federal tax revenue without a clear mechanism to ensure the benefits are fully passed on to low-income tenants, potentially subsidizing developers more than intended.
Tradeoffs
The bill balances the need for affordable housing preservation against potential federal revenue loss from expanded tax-exempt bond issuance. It also navigates the tension between federal oversight (volume caps) and state flexibility in addressing local housing needs.
Section 2(a), adding new subsection (o)(3) to Section 146 of the Internal Revenue Code of 1986.
Modified Application of Prohibition on Acquisition of Existing Property
For bonds exempted under this Act, the existing rule in Section 147(d) of the IRC, which generally limits the use of tax-exempt bond proceeds for acquiring existing property to 15%, is modified. This bill increases that threshold to 50%, allowing up to half of the bond proceeds to be used for property acquisition.
Section 2(b), adding new subparagraph (C) to Section 42(h)(4) of the Internal Revenue Code of 1986.
Exception from Low-Income Housing Tax Credit Limitation
This provision ensures that bonds exempted from the state volume cap under the new Section 146(o) will still be treated as meeting the '50 percent test' for Low-Income Housing Tax Credits (LIHTC). This test generally requires at least 50% of a building's aggregate basis to be financed by tax-exempt bonds to qualify for LIHTC, thereby ensuring projects using these new bonds can still access LIHTC.
Modifies the existing property acquisition rule (IRC Section 147(d)) for bonds exempted under this Act, changing the limit on bond proceeds used for acquisition from 15% to 50%.
Section 2(a), adding new subsection (o)(3) to Section 146 of the Internal Revenue Code of 1986.
Why it matters:This is standard legislative practice for amending specific technical thresholds within the tax code rather than rewriting entire sections. It's a precise adjustment to an existing rule.
Case for: Supporters argue this change is vital for enabling comprehensive rehabilitation projects, as many require acquiring the property before significant improvements can be made. The 15% limit is often impractical for such endeavors.
Case against: Critics might argue that increasing the acquisition allowance could incentivize speculative purchases or divert funds that would otherwise go directly to physical improvements, potentially benefiting property owners and developers more than tenants.
Estimated impact: This change could significantly expand the types and scale of rehabilitation projects eligible for tax-exempt bond financing, potentially unlocking more capital for property acquisitions tied to affordable housing preservation.
Ensures that bonds exempted from the state volume cap under the new Section 146(o) are still considered to meet the '50 percent test' for Low-Income Housing Tax Credits (LIHTC), thereby allowing projects using these bonds to qualify for LIHTC.
Section 2(b), adding new subparagraph (C) to Section 42(h)(4) of the Internal Revenue Code of 1986.
Why it matters:This is a technical fix to ensure legislative intent is realized across different sections of the tax code. It's a standard method for ensuring coherence in complex statutes.
Case for: Proponents assert this is a critical technical alignment, without which the primary bond exception would be largely ineffective, as LIHTC is often essential for the financial viability of affordable housing projects.
Case against: No specific opposition is typically raised against such technical alignment provisions, as they are designed to ensure different parts of the tax code work together as intended for a specific policy goal.
Estimated impact: This provision ensures that a significant source of equity (LIHTC) remains available for projects utilizing the new tax-exempt bond exception, making the overall financing mechanism viable for a broader range of affordable housing rehabilitation projects.