As noted in a recent CreditBryanCave blog entry, the Extenders Bill enacted at the end of 2014 was limited to a retroactive one year look-back and neither provided for additional credit in 2015 nor enacted any of the “improvements” that had been suggested from various tax credit programs. While the new chairman of the House Ways and Means and Senate Finance Committee are working on major tax reform, we believe that the prospects for major tax reform prior to the presidential election in 2016 are very slim.

Given the low probability of major tax reform, tax credit industry coalition groups have begun the process of introducing extender packages. Earlier this week, Senators Blunt and Schumer introduced a bipartisan bill, 5.599 to extend the New Markets Tax Credit, a program that has generated almost 750,000 jobs in areas that are underserved by capital.

In a similar vein, Congressmen Tiberi and Neal introduced bipartisan legislation to make permanent the fixed 9% and 4% credit rates for low-income housing tax credit projects that are placed in service after December 31, 2014. Sixteen additional republican and democrat congressmen co-sponsored the legislation. The Obama Administration proposed to permanently extend the renewable production tax credit (“PTC”) and to fix the renewable energy investment tax credit (“ITC”) and its current 30 percent rate. The proposal would also permanently extend the election to claim ITC in lieu of PTC. The Republican controlled tax writing committees are less likely to follow the President’s lead. Since the status of renewable energy credits do not change in calendar year 2015, inclusion of an extension of current law in a 2015 extender’s package is less likely, but given the long lead time for many renewable energy projects, the industry will continue to push for an extension in the absence of permanency.