Since Senators-elect Reverend Raphael Warnock and Jon Ossoff won the January 5 Georgia run-off elections, the Senate will be evenly divided between 50 Republicans and 50 Democrats. Vice-President-elect Kamala Harris will decide the outcome of any tied votes through her role as President of the Senate, giving Democrats the majority. With Democrats winning control of the Senate, 2021 offers a good chance for advances in affordable housing legislation.
The majority status of the Democrats means they will have the leadership of the full Senate and all committees, the ability to set the Senate floor agenda and more easily confirm Biden administration nominees, and the ability to take advantage of the budget reconciliation process. This allows the controlling party to bypass filibuster rules (which require 60 votes to pass legislation) and pass certain types of legislation with a simple majority.
The control of the Senate also means the Biden administration will have an easier path to enacting components of its comprehensive housing plan that calls for a $640 billion investment over ten years, including strengthening and expanding the Low-Income Housing Tax Credit (LIHTC) program, provision of Housing Choice Vouchers to all eligible families, creating a new renter’s tax credit, and providing a new $100 billion affordable housing fund.
With regard to the LIHTC program, the Biden Affordable Housing Plan calls for expanding the LIHTC with a $10 billion investment. This will be designed to make the credit more efficient, dramatically increasing the number of new or rehabilitated affordable housing units. The Plan will also ensure that urban, suburban, and rural areas all benefit from the LIHTC.
Following are some of the major elements of the Biden Housing Plan that now stand a much greater chance of moving forward:
Most of these proposal will require Congressional action, so the issue of who controls Congress is no small thing. Now that the Democrats control the Senate, the chance for passage of Biden’s plan increases.
Impact on Agencies
As with any change in administrations, the top leadership of both HUD and Agriculture will change. An additional factor is that during the past four years, many agency professionals have retired or resigned; these positions are harder to replace than the political appointees. Having said that, the appointment of qualified leadership can go a long way in attracting qualified professionals and retaining those that are there. President-Elect Biden has named his choices to head HUD and Agriculture.
Secretary of Housing & Urban Development (HUD)
President-elect Biden has nominated Rep. Marcia Fudge (D-OH) to lead HUD.
HUD will play a key role in the incoming administration’s response to the COVID-19 pandemic, which has caused millions of people to fall behind on rent and mortgage payments.
If confirmed, which is highly likely, Rep. Fudge will take over amid an acute housing crisis, as millions of tenants walloped by the pandemic-driven economic crisis face eviction and massive back-rent bills. The Biden administration is expected to push for Congress to pass a relief package dedicating billions of dollars to rent relief, and HUD will likely seek additional funding to address homelessness.
Fair housing will also be a priority. The Biden transition lists "racial equity" as a Day One priority, alongside COVID-19, the economic crisis and climate change. The gap in homeownership rates between white and Black Americans has never been wider, a key driver of the persistent racial wealth gap.
Among the new secretary’s first tasks will be restoration of the 2015 Affirmatively Furthering Fair Housing (AFFH) rule, which outgoing HUD Secretary Ben Carson revoked this past summer. The original rule - which the Obama administration introduced as a way to beef up enforcement of the Fair Housing Act - would have required local governments to track patterns of segregation with a checklist of 92 questions in order to gain access to federal housing funds.
The AFFH was not the only fair housing rule that the Trump administration has tried to gut. Carson’s HUD also introduced a regulation revamping the Agency’s 2013 "disparate impact" rule to make it harder to prove unintentional discrimination. A federal judge in October issued a preliminary injunction to stop HUD from implementing the new rule, which would have required plaintiffs to meet a higher threshold to prove unintentional discrimination, known as disparate impact, and given defendants more leeway to rebut the claims. It is likely that HUD, under Fudge, will return to a more neutral disparate impact test.
The naming of Fudge has resulted in an immediate improvement in the morale at HUD, which has deteriorated under the leadership of Ben Carson. Under Fudge, other initiatives of the Trump/Carson era will certainly be rolled back, including (1) the anti-Transgender rule changes to the Equal Access Rule, and (2) elimination of the proposal to force mixed-status immigrant families to separate or face eviction from HUD-assisted housing.
As for the Department of Agriculture, which oversees the rural housing programs, Biden has selected Tom Vilsack, who was the Agriculture Secretary under President Obama. Vilsack served as governor of Iowa from 1999 to 2007 and served as Agriculture Secretary for both of Obama’s terms. Since then, he has been a lobbying executive for the dairy industry. While not a popular choice among environmentalists, Vilsack was supportive of the RD housing programs, although he was not an aggressive advocate. His presence is unlikely to slow down the current push to roll RD housing programs into HUD.
In the not-to-distant future, the efforts to revise America’s approach to affordable housing will begin. It is certain that greater priority will be given to affordable housing over the next four years than during the most recent four years.
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