Retrospective: NH&RA: A Think Tank for Affordable Housing

13 min read

Helping Translate Policy into Opportunities and Transactions for 50 Years

In the early 1970s, the City of Boston embarked on an effort to encourage developers to acquire and rehabilitate older apartment buildings in disinvested neighborhoods. While today it might be hard to imagine “run down” neighborhoods in central Boston, they existed in every American city back then.

National Housing & Rehabilitation Association (NH&RA, NHRA) was incorporated at that time, by real estate entrepreneurs in several cities to persuade policy-makers to harness the skills of the private sector to improve inner-city apartment buildings.

While visiting apartment buildings renovated under the Boston Urban Rehab, or BURP program, as it was known, Housing and Urban Development (HUD) Secretary Carla Hills mistakenly referred to it as a HUD initiative. Rather than admit the error, a few of our members suggested she should create a similar federal program – and Project Rehab was born.

To implement Project Rehab, a subset of subsidy allocations was set aside for rehab developers who were pre-qualified and pre-selected by HUD to reply to Notices of Funding Availability (NOFAs) and propose projects.

As Project Rehab proceeded to implementation, the association became a means of communicating with the program’s regulator, HUD. The idea of upgrading existing apartment buildings to better serve their communities was new and novel back then. Tear down was the prevailing ethic during those early days of urban renewal. Our members were determined to prove there was another way.

In 1974, Ed Callahan, who had been an attorney at the Federal Housing Administration (FHA), before leaving government service and then served as NHRA’s first counsel, retired. The association moved its operations to Lane & Edson, P.C., a Washington law firm. I started at NHRA in 1976, my first professional job after college; I was 23 years old. As I approach my 69th birthday (Feb. 14, 2022), our executive editor, Paul Connolly, has asked me to share some history and thoughts about the Association.

Lane & Edson, P.C. was a small boutique law firm with a specialty in structuring tax-advantaged transactions and an emphasis on low-income housing. That firm was the predecessor of what has grown over the years to be the affordable housing practice at Nixon Peabody, L.L.P.

One of the firm’s founding partners, Chuck Edson, understood the value of trade associations for helping to shape policy, organizing the industry and building a specialized law practice. In addition to “NHRA,” as we were known back then (no ampersand), Lane & Edson also managed what today are the National Council of State Housing Agencies (NCSHA), Affordable Housing Tax Credit Coalition (AHTCC), National Assisted Housing Management Association (NAHMA), National Leased Housing Association (NLHA), the Institute for Professional and Executive Development (IPED) and the Institute for Responsible Housing Preservation (IRHP).

My “boss” was a partner, Art Hessel, who served as general counsel to NHRA. I was the sole day-to-day staffer for the association, organizing monthly meetings, producing our first newsletter, Recycling Real Estate, contacting HUD officials to obtain information and set up meetings, monitoring the Congressional Record and Federal Register daily to find anything relevant, doing legislative outreach to Congressional offices – and keeping our members informed about NOFAs.

Art was a great first boss. He taught me a lot, taking the time to explain HUD programs and drawing diagrams to teach me about deal structures and flow. He allowed me a lot of room to grow, to interpret my role and initiate new activities.

NHRA’s main objective then was to interface with HUD on subsidy issues and FHA on multifamily loan procedures, specifically to make sure policies created with new construction in mind did not get in the way of rehabilitation. Also, to preserve Section 167(k), a provision in the Internal Revenue Code allowing a five-year depreciation of expenses incurred for rehabilitation of housing to serve low-income families.

We convened monthly meetings to which our members flew in for a luncheon with a key HUD official or other influential guest. One of the useful things I learned from those early meetings is a technique I refer to as the “first bite question.” Before our guest arrived, we would figure out our key question – and ask it once our guest took their first bite and had a mouthful. Their non-verbal reactions often revealed truths that their carefully selected words would not!

An early memory, around 1978, is then-NHRA President John Sandefur (Columbus, OH) expanded to a new region in the southeast, working through a local HUD office that had not yet ever processed a rehab project. Exasperated by their insistence on a topographical drawing for an urban site covered completely by the existing building, Sandefur exclaimed, “Hell! I guess we’ll tear down the building, so we can draw the site!”

We spent the Carter administration years (1976-80) working with key staff to HUD Assistant Secretary for Housing

Lawrence “Larry” Simons, including Tony Freedman, Shelly Friedman and Shel Schreiberg, to review FHA procedures and identify areas where new policies or greater flexibility were needed for rehab. Later, we worked with John McIlwain and Bill Witte, Commissioner Simons’ later staff, continuing these efforts. Larry Simon’s tenure at HUD spawned the careers of many talented individuals who went on to illustrious careers in the affordable housing field.

Nearly 400,000 units a year were built during Commissioner Simons’ tenure. These were tremendous years of production under the Section 8 project-based program. Part of that effort was the Demonstration Rehab program, an initiative of Secretary Patricia Harris, who set aside an allocation of Section 8 authority to be awarded to developers who would make investments in poorer minority communities. Our NHRA members seized that opportunity.

While working to address HUD issues regarding rehab, NHRA was the sole advocacy group concerned with preserving Section 167(k). The five-year write-off expired every two years and had to be renewed by Congress. Sometimes it was extended in a comprehensive tax bill, but those didn’t happen often. In February 1980, Section 167(k) was on the verge of expiring. Some luges from Germany arrived at JFK Airport, on their way to the Lake Placid Olympics. A special tax bill had to be passed over-night to waive an excise tax on the sleds. Initially drafted as a one-page bill, it became a two-page bill – with the back page our extension of Section 167(k). I wish tax provisions could be enacted so easily these days!

Our efforts to preserve Section 167(k) led to developing political relationships directly and harnessing Congressional relationships that members cultivated. Speaker of the House Tip O’Neill (D-MA) joined NHRA for breakfast during one year’s tax deliberations. House Ways & Means Chairman Danny Rostenkowski (D-IL), a big fan of urban rehab, traveled with us to a NHRA annual meeting in Key Largo, FL. Senator John Kerry (D-MA), in his first two years in the Senate, traveled down to our annual meetings on St. Thomas, USVI.

Back in those days, members of Congress received honoraria for speaking to groups. In the House, honoraria had to be paid to charitable organizations designated by the elected official – and they each had their favorite charity. Senators were allowed to accept honoraria paid directly to them, up to a certain limit.

Once I understood the protocol, political giving became a useful and practical tool. It would not buy you the vote you were looking for, but it did get you the audience to make your case. My first “honoraria-driven” event featured Senate Banking Chairman Jake Garn (R-UT) and Ranking Minority Member Don Riegle (D-MI). Garn’s staff was insistent about the honorarium. “Who would give the check to the senator? When would it be given? Must be before he goes on.” Riegle’s staff never mentioned it. The situation left me nervous, and I ended up handing each the other senator’s check. Fortunately, I negotiated the same honorarium for both, so neither was insulted and I went to the Hill the next day to swap the checks.

While politics has changed over the years, the basic lessons we learned back then continue to hold true. Long-term relationships pay off. Sustaining an ongoing relationship with an elected official, and her or his key staff, is critical for being able to present your issues when they arise. Credibility is built slowly, over a long period of time. Some members understand this and work assiduously to cultivate and sustain relationships. Others leave it to the legislative specialists, but constituent relationships are of tantamount importance. We’dhave greater success politically if more industry participants continually work on building relationships with elected officials.

In 1981, President Ronald Reagan took office. Shortly thereafter his administration put further development under the Section 8 program on hiatus. It was too costly. NHRA argued to HUD that while it might work to shut off development on vacant land and put planned projects on hold, properties being rehabbed had tenants in occupancy, and systems and utilities to be maintained. They couldn’t be terminated without causing undue hardship on residents and owners. We prevailed and rehab projects were permitted to continue through this period.

Our strategy for persuading HUD to allow rehab projects to continue was devised at a gathering convened in August 1981 at the Nantucket home of NHRA President Sandy Gallanter. Several members, counsel and staff spent a weekend sitting on Sandy’s porch discussing our predicament and options. We determined a course of action, who had contacts and access, and embarked on an effort to make our case. The success of this gathering was the inspiration for establishing the NHRA Summer Institute the next summer on Martha’s Vineyard.

Later in the Reagan years, a new shallower subsidy version of Section 8, the Moderate Rehab program, was introduced. It earned a dubious reputation as it became known that some project sponsors were obtaining Section 8 allocations by paying administration insiders as consultants and making contributions to the President’s re-election campaign. As a result, Congress passed the HUD Reform Act in 1989, which governs how HUD does business to this day.

In the middle of the Reagan era, Congress passed the Tax Reform Act of 1986. This upended real estate transactions, personal investment decisions, specialized incentives for low-income housing and many other aspects of tax planning. It happened abruptly and was a tense time.

I recall a Senate Finance hearing when Chairman Bob Dole (R-KS), who often deployed a wry sense of humor, after hearing testimony for a seemingly endless list of special tax provisions for real estate, asked, “Why don’t we do away with all these special provisions and just not tax real estate? Period.” The room went silent. No one knew how to respond. All the tax lobbyists were sitting there thinking, “Oh, no. There goes my job!”

The ’86 Act did something special for affordable housing. In lieu of all the prior incentives, we were given the Low Income Housing Tax Credit (LIHTC), an entirely new capital formation tool, to be administered on a de-centralized basis by the states, unleashing a new era of creativity.

NHRA did what it does best. We convened leading developers, specialized attorneys and accountants, capital formation experts and state agency representatives to figure out how we can make this tool work. We started posting all state allocation plans and notices on our website,, the only comprehensive source back then. We convened summer conferences in Snowmass, CO, to give the industry experts trying to make the program work and our state agency partners time to collaborate and become acquainted. We launched Tax Credit Advisor, first as a monthly newsletter, before it grew into a magazine. Tax Credit Advisor included a monthly supplement that provided updates on all allocating agencies. Ronne Thielen, a luminary in the affordable housing community, was the contributing editor who researched and produced that for us.

In the ensuing years, LIHTC spawned a more broadly based affordable housing industry. Along the way, numerous additional financing tools have been devised to further assist deals – but have also presented challenges. That is our association’s forte. That is where NH&RA excels. The expertise in our network figures out first how to turn challenges into opportunities.

We have been able to attract great thinkers, the most prolific developers, socially motivated investors and dedicated professionals to our network and sustain their participation and contributions.

A few years into the tax credit program, as we were trying to grow our membership, we often heard from developers invited to join that they did not do rehab, only new construction. Perhaps a re-branding was in order? Some of us were hesitant to abandon our name and reputation since we did not have the resources to promote a new brand identity. After a bit of deliberation, one board member suggested that we just add an ampersand. Hence, we became the National Housing & Rehabilitation Association, an information-sharing network for affordable housing developers, both new and rehab.

The role of NH&RA continually evolves. We organized developers involved with HOPE VI to iron out policy issues with HUD. We facilitated the formation of the market analysts council, as well as standards and best practices for that specialty. We helped blaze the trail to see the historic rehab credit deployed more frequently, particularly when twinned with LIHTC. We instituted ongoing dialog among affordable housing asset managers. We received a prestigious MacArthur Foundation grant to help developers implement energy improvements. We have helped several state agencies increase production under their tax-exempt bond authority. The list goes on and on.

Much of the credit for the role we perform at NH&RA today goes to Thom Amdur, who succeeded me as president a few years ago. Thom joined our staff sixteen years ago, in his early 20s, similarly to me, his first job with professional responsibility. He has grown with the organization, conceived and implemented many new activities, earned a reputation as a knowledgeable affordable housing professional, and carries on the tradition of NH&RA, convening the smartest minds in the business to make us all more successful.

At NH&RA, we like to think that “we make things happen.” We bring people together to share knowledge, develop ideas and build better affordable housing. The reward for those of us who work at the Association is seeing what you—our members—achieve. As I travel around the country, I enjoy seeing innovative affordable housing developments. Many I see have been produced by our members. It is a joy to see them. It makes us proud.

Peter Bell is President and CEO of the National Housing & Rehabilitation Association, a 46 year old organization of real estate developers, lenders, equity investors, attorneys, accountants, nonprofit and public officials who are involved in the development, financing and operation of affordable housing under various federal, state and local housing programs. Mr. Bell has served as NH&RA's President and CEO since 1976. Mr. Bell is the owner and publisher of Tax Credit Advisor, a monthly magazine focused on real estate development utilizing various federal tax credits, including the low income housing tax credit, historic rehabilitation tax credit and the New Markets Tax Credit. Mr. Bell is also executive director of the Telluride Society for Jazz, a Colorado nonprofit organization that hosts the Telluride Jazz Festival, August 4-6 in 2017.