Bill Would Expand LIHTC Housing Options for Formerly Homeless Students

In November, U.S. Senators Angus King (I-Maine), Sherrod Brown (D-Ohio), and Rob Portman (R-Ohio) and Rep. Brad Wenstrup (R-Ohio) and Rep. Danny Davis (D-Ill.) from the House introduced “The Housing for Homeless Students Act of 2022” to help homeless students, veterans, and foster youth access affordable housing while pursuing an education.

If passed, the legislation would amend the student rule of the LIHTC program. Under current law, full-time students are prohibited from living in LIHTC-funded sites. This prohibition, also known as the “student rule,” was intended to prevent the building of dormitories with LIHTC funds.

Current LIHTC program’s student restrictions. If your site has a household that’s comprised entirely of full-time students, then it’s important that an exception be properly documented in your files. Currently, a household can’t be comprised of all full-time students (Kindergarten through 12th grade and institutions of higher education) unless they meet one of the following exceptions:

• A student receiving assistance under Title IV of the Social Security Act (TANF); or
• A student who was previously in the foster care program; or
• A student enrolled in a job training program receiving assistance under the Job Training Partnership Act or under other federal, state, or local laws; or
• The household is comprised of single parents and their children and the parents are not dependents of another individual and the children are not dependents of another individual other than a parent of the children. In the case of a single parent with children, the legislative history explains that none of the tenants (parent or children) can be a dependent of a third party; or
• The household contains a married couple entitled to file joint tax returns.

For the LIHTC program, a student who’s a full-time student for five months out of the current calendar year is considered a full-time student for the entire calendar year. The months don’t need to be consecutive.

Proposed bill. The Housing for Homeless Students Act of 2022 would create a limited exception to the LIHTC student rule so as to allow homeless or recently homeless individuals who are full‑time students to live in LIHTC units. Under provisions of the legislation, any full-time student who was a child who experienced homelessness during the previous seven years or who’s a veteran who experienced homelessness during the previous five years could live in LIHTC-financed housing.