Transit Oriented Development Act of 2026

Bill Number

H.R. 9267

Origin Chamber

House

Congress

119th Congress, Session 2

Policy Area

Taxation

Status

Introduced

Latest Action

2026-06-11: Referred to the House Committee on Ways and Means.

Last Updated

2026-07-01T20:27:59Z

AI-Generated Summary

Transit Oriented Development Act of 2026 H.R. 9267

Purpose

This legislation amends the Internal Revenue Code to expand incentives under the low-income housing tax credit (LIHTC) program. Its goal is to encourage the construction and rehabilitation of affordable housing in areas near public transit that are zoned for high-density development, while also directing a study on geographic cost differences.

Key Provisions

• Enhanced tax credit for transit-oriented areas:
• For new buildings in designated areas, eligible basis increases to 150% of the standard amount (or 155% in Hawaii, Alaska, or U.S. territories).
• For existing buildings, rehabilitation expenditures qualify at the same increased rate.
• Designation criteria: Areas must be within one-half mile of a rail, bus, harbor, or waterway station and zoned for high-density use. Designations are made jointly by the Secretary of Housing and Urban Development and the relevant state housing credit agency.
• Population limits: Designations within metropolitan statistical areas cannot exceed 20% of the area's total population; a similar rule applies to non-metropolitan areas.
• Coordination rule: Buildings already receiving an increase under existing high-cost area rules (subparagraph (B)) cannot also qualify under the new transit-oriented provision.
• HUD study: The Secretary of Housing and Urban Development must examine cost-of-living variations based on location and transit access, then recommend formulas to adjust state LIHTC allocations accordingly. The report is due to Congress within one year of enactment.
• Effective date: The tax credit changes apply to buildings placed in service after the date of enactment.

Significant Changes to Existing Law

The bill adds a new subparagraph (C) to Section 42(d)(5) of the Internal Revenue Code. This creates a targeted 50% (or 55% in specified locations) boost to eligible basis for transit-oriented projects, separate from the existing difficult development area adjustments. It also imposes new designation limits and coordination requirements not previously present in the statute.

Potential Impacts

• Government agencies: Increases administrative responsibilities for HUD and state housing credit agencies in designating areas and conducting the required study.
• Citizens: May lead to additional affordable housing units near transit stations, potentially improving access for low-income residents.
• International relations: No direct effects; the provisions extend to U.S. territories but do not alter foreign policy or treaties.

Main Stakeholders

• Affordable housing developers and investors seeking LIHTC allocations.
• State and local housing agencies responsible for designations and credit distribution.
• The Department of Housing and Urban Development.
• Low-income households in metropolitan and non-metropolitan areas.
• Members of Congress involved in tax and housing policy.

Notable Legal, Constitutional, or Political Implications

The changes fall within Congress’s authority to modify the tax code and do not raise apparent constitutional issues. The legislation maintains the existing structure of the LIHTC program while adding location-specific incentives and a study requirement, with designations limited to prevent over-allocation.

This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.

Sponsor

Rep. Case, Ed [D-HI-1]

Cosponsors (2)

Del. Moylan, James C. [R-GU-At Large], Rep. Tokuda, Jill N. [D-HI-2]

Recent Actions

• 2026-06-11: Referred to the House Committee on Ways and Means.
• 2026-06-11: Introduced in House
• 2026-06-11: Sponsor introductory remarks on measure. (CR E570)
• 2026-06-11: Introduced in House

Bill Versions

• Transit Oriented Development Act of 2026 — issued 2026-06-11 — PDF (4 pages)