On March 12, the U.S. Senate passed the bipartisan 21st Century ROAD to Housing Act. Among provisions intended to boost housing availability and affordability is one that would raise the public welfare investment cap from 15% to 20%. The cap dictates how much of a bank’s risk-adjusted capital can be invested in low-income housing projects. This would allow more banks to take advantage of low-income housing tax credit programs that were expanded starting this year. In February, a housing bill with similar provisions passed the U.S. House. The difference? The Senate bill would limit some institutional investment and temporarily ban the Federal Reserve from issuing a digital currency.
