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ENROLLED ORIGINAL
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A RESOLUTION
26-210
IN THE COUNCIL OF THE DISTRICT OF COLUMBIA
October 7, 2025
To declare the existence of an emergency with respect to the need to amend the Rental Housing
Act of 1985 to clarify that any rental unit participating in the Low-Income Housing Tax
Credit program is exempt from the Rent Stabilization Program.
RESOLVED, BY THE COUNCIL OF THE DISTRICT OF COLUMBIA, That this
resolution may be cited as the “LIHTC Rent Stabilization Exemption Clarification Emergency
Declaration Resolution of 2025”.
Sec. 2. (a) Low Income Housing Tax Credit (“LIHTC”) units in the District of Columbia
have been exempt from rent stabilization since the inception of the Rental Housing Act of 1985,
effective July 17, 1985 (D.C. Law 6-10; D.C. Official Code § 42-3501.01 et seq.). Section
205(a)(1) (D.C. Official Code § 42-3502.05(a)(1)) provided that, “Any rental unit in any
federally or District-owned housing accommodation or in any housing accommodation with
respect to which the mortgage or rent is federally or District-subsidized” were exempt.
(b) This exemption of LIHTC units from rent stabilization was overturned by Judge Julie
H. Becker’s decision in Milestone v. Daniels, Case No. 2024-LTB-7847, based on the definition
of direct vs indirect government subsidy.
(c) Ninety-nine buildings with more than 11,000 units are LIHTC assisted and would be
subject to rent stabilization without this exemption. Without a large infusion of new capital, these
properties will likely default on their financial commitments due to loss of rental income.
(d) The LIHTC program has its own rent increase limitations, defined by the U.S.
Department of Housing & Urban Development (“HUD”) as “rents can increase annually by 5%
or two times the percentage change in national median income, whichever is higher.”1
Furthermore, HUD capped that increase to 10% in 2024. These limitations ensure that even if
1 National Low Income Housing Coalition, 2024 https://nlihc.org/resource/hud-caps-rent-
increases-lihtc-financed-properties-
10#:~:text=Share,their%20limited%20incomes%20on%20rent.
ENROLLED ORIGINAL
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LIHTC units are exempt from the District’s rent stabilization laws, rents will be affordable and
align with tenants’ incomes.
(e) The law must be clarified to state that LIHTC units are exempt from further rent
stabilization as defined in the Rental Housing Act of 1985 to ensure that LIHTC properties
remain subject to the rent structures agreed to at financing. This clarification also aligns the
Rental Housing Act of 1985 with the District of Columbia Housing Finance Agency Act,
effective March 3, 1979 (D.C. Law 2-135; D.C. Official Code § 42-2701.01 et seq.) (“HFA”),
which exempts HFA LIHTC units from rent control or stabilization.
(f) LIHTC provides critical preservation funding for affordable housing in the District
and attracts essential reinvestment capital for older housing stock in need of repairs.2 If the
District does not act, LIHTC preservation properties will be at risk of defaulting on their
financing, stymying the LIHTC investment market and slowing down affordable housing
production.
(g) Exempting LIHTC units from rent control or stabilization does not raise rents but
preserves the rents and rent increases agreed to by tenants at the time they signed their leases.
(h) Emergency legislation is necessary to ensure that LIHTC preservation properties
avoid foreclosure, the LIHTC market remains strong, and tenants are able to remain in their
homes.
Sec. 3. The Council of the District of Columbia determines that the circumstances
enumerated in section 2 constitute emergency circumstances making it necessary that the LIHTC
Rent Stabilization Exemption Clarification Emergency Amendment Act of 2025 be adopted after
a single reading.
Sec. 4. This resolution shall take effect immediately.
2 NLIHC, Dan Emmanuel, The Preservation of Affordable Housing, 2022.