Elections have consequences. With the election of Joe Biden as President, the consequences for the affordable housing industry are likely to be very positive and will at the least put an end to the ambivalent – and even hostile – approach that the Trump administration has taken toward affordable housing during the past four years.
The incoming administration has presented a detailed and comprehensive blueprint for how it will approach the housing affordability problem for the next four years. Following are some of the major elements of the plan, with a focus on affordable rental housing.
- End redlining and other discriminatory housing practices. The Biden Plan includes a Homeowner & Renter Bill of Rights that will expand protections for renters, including a law prohibiting landlords from refusing to accept vouchers. The mechanism for this would be a revision to the Fair Housing Act, adding “Source of Income” as new protection.
- Tenant eviction protection will be pushed with the passage of The Legal Assistance to Prevent Evictions Act of 2020. This will assist tenants facing eviction in obtaining legal assistance.
- The elimination of local and state housing regulations that perpetuate discrimination – specifically exclusionary zoning. Biden’s proposed legislation would require any state or locality receiving Community Development Block Grant (CDBG) funds or (more significantly) Surface Transportation Block Grants to develop a strategy for inclusionary zoning and will fund states to assist them in eliminating exclusionary zoning policies. This is a particularly important proposal, especially the withholding of transportation funds. While not all localities use CDBG money, virtually every city and state want to share in the federal transportation funds. The inability to build new roads or improve highways would be a major issue for localities and the potential withholding of such funds would be a serious “stick” in the push for inclusionary zoning. This could open up substantial new urban areas for the development of affordable rental housing.
- Strengthen the Community Reinvestment Act (CRA) to ensure that non-bank financial service institutions (e.g., mortgage and insurance companies) serve all communities.
- Provide downpayment assistance through a refundable and advanceable tax credit of $15,000 and fully fund the Housing Choice Voucher and Project-Based Rental Assistance (PBRA) programs. Under this proposal, Housing Choice Vouchers would be made available to every eligible household. Currently, 75% of eligible families do not receive assistance. This, along with fully funding the PBRA programs, would provide assistance to 17 million households.
- Creation of a new renter’s tax credit, designed to reduce rent and utilities to 30% of income for families who make too much money to qualify for rental assistance.
- Expand housing benefits for first responders, public school teachers, and other public and national service workers who commit to live in persistently impoverished communities. This program would provide additional down-payment assistance and low-interest rehab loans.
- Establish a $100 billion Affordable Housing Fund to construct and upgrade affordable housing – primarily in areas with a short supply of affordable housing.
- Increase funding for the HOME program by $5 billion.
- Increase funding for the Housing Trust Fund (HTF) Program by $20 billion.
- Expand the Low-Income Housing Tax Credit Program (LIHTC) by $10 billion.
- Increase funding for repairs to the Rural Development Section 515 Program.
Most of these proposals will require Congressional action, so the issue of who controls Congress is no small thing. Obviously, if the Democrats win both the Georgia Senate seats in the January 5 runoff election, the chance for passage of Biden’s plan increases. However, even if Republicans retain the Senate, there is strong support for affordable housing. Susan Collins of Maine was re-elected. She heads up the Subcommittee on Transportation, Housing & Urban Development (THUD) and is a strong advocate for affordable housing. In fact, it has been the Republican Senate, along with the Democratic House, that has prevented many of the draconian cuts to affordable housing favored by the Trump Administration.
Impact on Agencies
As with any change in administrations, the top leadership of both HUD and Rural Development 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, appointment of qualified leadership can go a long way in attracting qualified professionals and retaining those that are there. President Elect Biden has not yet named his choices to head HUD and Agriculture, but a number of names have been floated:
- High on the list of possible HUD Secretaries is Alvin Brown, the former Mayor of Jacksonville, FL and former executive director of the White House Community Empowerment Board. Brown worked at HUD under Bill Clinton.
- Maurice Jones, who held the number two slot at HUD under Secretary Shaun Donovan is also high on the list. Jones left HUD to serve as Virginia’s Secretary of Commerce and Trade and now leads the Local Initiatives Support Corporation (LISC), a nonprofit that supports community development.
- In the mix as well is Diane Yentel, the president and CEO of the National Low-Income Housing Coalition. Yentel was also at HUD during the Obama administration, directing the public housing management and occupancy division.
- Representative Karen Bass (D-CA) and Atlanta Mayor Keisha Lance Bottoms have also been mentioned as possible nominees, along with Tampa Mayor Jane Castor.
Any of the named individuals would result in immediate improvement in the morale at HUD, which has deteriorated under the leadership of Ben Carson. Regardless of who is selected to head HUD, some initiatives of the Trump/Carson era will certainly be rolled back, including (1) the anti-Transgender rule changes to the Equal Access Rule, (2) changes to the Affirmative Fair Housing Plan requirements, (3) the changes to the Disparate Impact Rules, and (4) 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, former Senator Heidi Heitkamp of North Dakota appears to be the front runner. She has strong moderate credentials and would likely be supported in the Senate – even by Republicans.
Members of the Congressional Black Caucus have been pushing Representative Marcia Fudge (D-OH). Fudge is the top candidate among progressives, and currently chairs the House Agriculture subcommittee on nutrition and has been a strong critic of USDA budget cuts.
A longer shot is Representative Cheri Bustos (D-Il), who chairs the democrats campaign arm. She is also on the House Agriculture Committee but her seat is in a vulnerable district and could go to a Republican in a special election. For this reason, her selection seems unlikely.
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.