Articles
New affordable housing bill aims to add 1.9M units nationwide
Washington,
June 5, 2019
Tags:
Economy
Curbed |
A bipartisan group of Senate and House legislators have proposed a sweeping bill to help solve the affordable housing issue yesterday, joining many of the Democratic presidential nominees in making housing a larger issue on the national stage, and showing the nationwide nature of the housing shortage. The Affordable Housing Credit Improvement Act of 2019 seeks to close the gap in affordable rental units across the nation. It would do so by expanding and strengthening the Affordable Housing Tax Credit, also known as the Low Income Housing Tax Credit, a pillar of federal housing policy. If passed, the bill expects to create 1.9 million additional affordable units over the next decade. According to the National Low-Income Housing Coalition, there’s a national shortage of seven million affordable and available rental homes. Created 30 years ago, the Affordable Housing Tax Credit offers developers generous tax breaks if new development will include affordable units (defined charging rent that’s roughly 30 percent of total income, based on area median income). It has been used to construct more than 3.2 million housing units, leveraging more than $190 billion in private investment. The Affordable Housing Credit Improvement Act would stimulate construction by increasing the amount of credit used to build affordable units by 50 percent, which is estimated to create of 384,000 more homes in the next decade. The Act would also stabilize the value of the tax credit at four percent, eliminating uncertainty for developers juggling additional acquisition costs and other subsidies. It would also allow “recycling” of multifamily housing bonds, a financing mechanism that allows for the reuse of tax-exempt bonds, which would create 100,000 additional units. The bill was introduced yesterday by Senators Maria Cantwell (D-WA), Johnny Isakson (R-GA), Ron Wyden (D-OR), and Todd Young (R-IN), and U.S. Representatives Suzan DelBene (D, WA-01), Kenny Marchant (R, TX-24), Don Beyer (D, VA-08), and Jackie Walorski (R, IN-02), representing a cross-section of states and parties. |