HUD Secretary Ben Carson to propose tripling rent for some low-income Americans receiving federal housing subsidies

April 25, 2018                            By: Tracy Jan

Housing and Urban Development Secretary Ben Carson on Wednesday will propose tripling the amount the poorest households are expected to pay for rent as well as encourage those receiving housing subsidies to work, according to the administration’s legislative proposal obtained by The Washington Post.

U.S. Secretary of Housing and Urban Development Ben Carson testified before a Senate Banking Committee hearing last month. (Reuters/Kevin Lamarque)

The move to overhaul how low-income rental subsidies are calculated would affect more than 4.5 million families relying on federal housing assistance. The proposed legislation would require congressional approval.

Tenants generally pay 30 percent of their adjusted income toward rent or a public housing agency minimum rent — which is capped at $50 a month for the poorest families. The administration’s legislative proposal sets the family monthly rent contribution at 35 percent of gross income or 35 percent of their earnings working 15 hours a week at the federal minimum wage. Under the proposal, the cap for the poorest families would rise to approximately $150 a month, three times higher than the current minimum..........................Read More

Two Steps to Ensure Affordable Housing Production is not Lost

April 2, 2018                       By: Michael Novogradac

Affordable rental housing survived the tax reform war of 2017, though not unscathed. Now it needs to stabilize and prepare to rebuild–and it took a first step to do so in March.

Tax credits and private activity bonds (PABs) were all under significant threat during 2017’s yearlong battle over tax reform, which resulted in the passage of H.R. 1 in December 2017. The legislation preserved the low-income housing tax credit (LIHTC), PABs, the new markets tax credit (NMTC) and renewable energy investment tax credit (ITC) and production tax credit (PTC); while preserving but changing the historic tax credit (HTC). Considering that the House version of tax reform included the elimination of the tax-exemption of PABs, which help fund more than half of LIHTC developments every year, things could have been considerably worse.

However, merely preserving these incentives doesn’t mean they escaped unharmed–particularly the LIHTC. The damage to affordable housing from the tax legislation is steep, primarily because the reduction of the top corporate tax rate from 35 percent to 21 percent.

That means the value of the tax losses that accompany LIHTC investments is reduced. A Novogradac & Company analysis found that the 14 percent lower corporate tax rate likely reduces the amount of LIHTC equity that can be raised by about 14 percent. In dollar value, that’s roughly $1.7 billion each year........................Read More

Congress Helps Affordable Housing Developers

April 3, 2018                            By: Bendix Anderson

The new federal budget just passed by Congress includes a few changes that will strengthen the LIHTC program.

Affordable housing developers got a nice surprise when Congress passed its federal budget for 2019, which became law in March 2018.

“The recently enacted omnibus contains some welcome increases that will help affordable housing production,” says Scott Hoekman, senior vice president and chief credit officer for Enterprise Community Investment, a non-profit based in Washington, D.C. that helps finance and build affordable housing.

The affordable housing industry has been troubled by uncertainty recently. The Tax Cuts and Jobs Act of 2017 kept the low income housing tax credits (LIHTC) program, but its new, lower corporate tax rate has made the LIHTC program less effective.

The new federal budget just passed by Congress will make up for some of those losses. Plus, the budget includes a few changes that will strengthen the program.

“The industry can now once again focus on building and preserving affordable housing,” says Hoekman.....................Read More

This beautiful neighborhood is defying Section 8 housing stereotypes - take a look

April 1, 2018                                                        By: Leanna Garfield

Today's stereotypes of what public housing looks like originated four decades ago.

In 1978, the Jimmy Carter administration created the Housing Choice Voucher program, also known as Section 8, which provides assistance to low- and moderate-income families to rent affordable housing built by local housing authorities.

Westlawn Gardens, a public-housing development in Milwaukee, Wisconsin. HUD/APA

You've likely seen some of these 1980s-era apartment buildings — characterized by their boxy shapes and shabby brick facades — which come with a number of negative stereotypes. A 2010 analysis points to five major public concerns around Section 8 units: a lack of maintenance, expectation of crime, disapproval of housing as a handout, reduction of property values, and physical unattractiveness.

A redeveloped public-housing neighborhood in Milwaukee, Wisconsin could defy those old attitudes. Called Westlawn Gardens, it features green lawns, a community garden, new sidewalks and stormwater drains, and attractive apartment units with bright exteriors and modern interiors. Milwaukee's housing authority contracted the architecture firms Torti Gallas & Partners and Kindness Architecture & Planning to redesign Westlawn....................Read More