Started May 16, 2022 101
On May 16, 2022, the Biden Administration announced a Housing Supply Action Plan to “ease the burden of housing costs over time by boosting the supply of quality housing in every community.” The plan, unveiled at a White House briefing, includes both legislative and administrative actions to help close the nation’s housing supply shortfall in five years. Among other provisions, the plan calls for:
- Financing more than 800,000 affordable rental units by expanding and strengthening the LIHTC through enactment of provisions included in the House-passed reconciliation bill. The bill (also known as the Build Back Better Act) would increase tax credit allocations, provide additional capacity for private activity bonds to finance affordable housing, target tax credits for housing that serves extremely low-income Americans, and make it easier to produce and preserve affordable housing with tax credits in Indian Country.
- Providing an additional subsidy through the LIHTC to developments that add net new supply and that would otherwise not be financially feasible. This proposal was included in the Administration’s FY 2023 budget.
- Strengthening Government-Sponsored Enterprise (GSE) financing for multifamily development and rehabilitation.
- Leveraging American Recue Plan funds for investments in affordable housing.
- Finalizing the LIHTC Income Averaging proposed guidance by the end of September 2022.
- Advancing HOME as a key tool for the production and preservation of affordable rental and homeownership housing.
- Providing tax credits to build and rehabilitate homes for low- and moderate-income homebuyers. This proposed legislation, the Neighborhood Homes Investment Act (NHIA), is included in the House-passed reconciliation bill.
- Improving the alignment of federal funds to reduce transaction costs and duplications and accelerate development.
- Supporting the construction of more than 8,000 rural multifamily housing units.
- Supporting new and existing affordable housing in Indian Country.
- Providing incentives for land use and zoning reforms and reducing regulatory barriers.
- Addressing supply chain disruptions for building materials.
- Recruiting more workers into good-paying construction jobs.
HUD Secretary Marcia Fudge further discussed the plan at a May 16 housing event in Columbus, OH. She was joined by U.S. Senator Sherrod Brown (D-OH), U.S. Congresswoman Joyce Beatty (D-OH), and Columbus Mayor Andrew Ginther.
We also want to call to your attention a Wall Street Journal op-ed, America Needs More Houses, co-authored by Brian Deese, Director of the White House Economic Council, and Suzanne Clark, President and CEO of the U.S. Chamber. It describes the housing shortage and highlights the LIHTC and NHIA as two policy tools that have bipartisan support and are necessary for closing the housing supply gap.
We are very appreciative of the Administration’s efforts to expand affordable housing preservation and production. We are dismayed that the Average Income Test regulation will not be released until late September but are hopeful it will conform to Congressional intent and encourage investment in mixed-income properties. While these steps are very welcome, it is incumbent that Congress act on legislation that would increase resources for production of new affordable housing. We continue to work with our colleagues in the industry and supporters in Congress to see our LIHTC agenda enacted.