Pennsylvania Housing Finance Agency Financial Incentives and Passive House Partnership

In 2015, the Pennsylvania Housing Finance Agency (PHFA) adopted new funding criteria—making it the first U.S. state to offer tax credits for affordable housing developments built to Passive House standards. This approach has served as a model for dozens of other states, spurring new high-efficiency homes for disadvantaged communities nationwide.

Pennsylvania Agency Goals

The Pennsylvania Housing Finance Agency (PHFA) administers Low Income Housing Tax Credits (LIHTC), allocating millions of dollars of federal funding annually for affordable housing development. By 2014, developers were consistently surpassing PHFA energy efficiency building requirements for tax credits, and PHFA began seeking new, more challenging requirements.

In 2015, a coalition of 25 industry stakeholders (including members of the Mayors’ offices of Philadelphia and Pittsburgh) approached the PHFA to advocate for the inclusion of “Passive House” standards in LIHTC funding criteria. In adopting Passive House, PHFA became a national leader, providing tax credit incentives for Passive House high-performance envelopes and efficient HVAC systems within certifiable affordable housing communities and zero net energy (ZNE)-capable homes.