Fairfax County Retains AAA Bond Rating

The Fairfax County government’s AAA ratings for general-obligation debt have been affirmed by the nation’s three major bond-rating houses, which looked at the government’s financial condition ahead of a Jan. 24 sale of debt. The county government successfully sold $350 million in bonds, designed to fund the following areas: Schools – $205 million, Transportation – $68.74 million, Public Safety – $35.26 million, Parks and Parks Facilities – $28 million, Public Library Facilities – $5 million, Human Services and Community Development Facilities – $8 million.

“There were five bidders for the county’s bonds, and this number of bids underscores strong support for the county’s bond offerings and credit ratings,” county officials said. “The county’s annual January general-obligation bond sale remains an opportune time to sell with high demand and lower-than-average supply of municipal bonds.” AAA-rated bonds have a high degree of creditworthiness because their issuers are easily able to meet financial commitments and have the lowest risk of default.
The county has held a AAA rating from Moody’s since 1975, Standard and Poor’s since 1978 and from Fitch Ratings since 1997. Fairfax is among 13 states, 49 counties and 31 cities that have a AAA bond rating from all three major rating agencies.

Projects to be supported by the bond sale were approved by voters in various referendums. “We followed the will of the voters and sold bonds that will improve our schools, continue to build out our multi-model transportation system, and improve public safety, parks, libraries and other critical county infrastructure,” said Board of Supervisors Chairman Jeff McKay, who said that the top rating has enabled the county to save more than $1 billion in interest payments over the past 45 years, compared to localities with lower ratings.

New Fairfax Supervisor Bierman Presses VDOT

The Fairfax County Board of Supervisors on Jan. 23 approved a request by Supervisor Jimmy Bierman (D-Dranesville) to continue pressing Virginia Department of Transportation (VDOT) officials on concerns related to the Interstate 495 Express Lanes Northern Extension (495 NEXT) Project Supervisors have, with some reservations, supported that initiative, as well as Maryland’s plans to widen the American Legion Bridge and build Express Lanes on that state’s side of the Beltway to connect with Virginia’s.

But Maryland officials recently scrapped plans for a public-private partnership to build its improvements, and instead will seek federal grant funds.

U.S. House Passes $78 Billion Affordable Housing Measure

The U.S. House of Representatives Wednesday passed a roughly $78B tax package that includes a significant boost to the availability of and eligibility for tax credits commonly used to fund affordable housing projects.

The Tax Relief for American Families and Workers Act of 2024 would reinstate a 12.5 percent low-income housing tax credit ceiling for 2023 through 2025, allowing states to allocate more credits for affordable housing projects, even retroactively in some cases.

“This provision restores the 12.5 percent increase in 9 percent allocations for CY 2023 through CY 2025 and is effective for taxable years beginning after Dec. 31, 2022,” according to accounting and consulting firm Novogradac & Co.

It would also lower the threshold of state and local tax-exempt bond financing a project has to receive for its developer to qualify for the maximum credits to 30 percent instead of the current 50 percent, the New York Times previously reported.

The bill includes a host of other impacts, notably changes to child and business tax credits, which would be in effect for 2024 and 2025 if the bill gets all needed approvals.

The Mortgage Bankers Association applauded the House’s vote, noting that “the enhancements to the LIHTC program will improve the supply and [affordability] challenges in the rental market by producing an estimated 200,000 additional rental units over the next two years,” the MBA said in a statement.

The bill’s affordable housing provisions “would have a profound effect on affordable housing development and would likely make up the largest increase in affordable rental housing resources since 2000,” according to Novogradac. The firm also provided the 200,000-unit estimate being touted to show the potential impact of the legislation.

The legislation comes as many states across the country face housing affordability issues, especially for their poorest residents. Between 2019 and 2021, the shortage of homes affordable for and available to extremely low-income renters grew from a deficit of 6.8 million to a shortage of 7.3 million, “continuing a long-term trend of diminishing supply,” according to the National Low Income Housing Coalition. Those renters in Nevada, Oregon, Florida, California, Arizona and Texas faced the most intense shortages.