Cantwell Continues Affordable Housing Push, Presses Treasury Secretary Mnuchin to Work on Solution
Cantwell: “We certainly have a supply problem” when it comes to affordable housing
WASHINGTON, D.C. – In a Senate Finance Committee hearing today, U.S. Senator Maria Cantwell (D-WA) pressed Secretary of the Treasury Steven Mnuchin on the need for more affordable housing.
“I particularly want to ask you about the Low Income Housing Tax Credit,” Cantwell said. “90 percent of the [federally-financed] affordable housing that is built is built with the tax credit, which means if we don’t expand the capacity for the credit, we’re not going to get more supply, and we certainly have a supply problem.”
In her questions, Cantwell specifically asked about a fix for the four percent housing tax credit, which helps finance the construction and rehabilitation of affordable housing units. Cantwell referred to bipartisan work she is leading to fix the value of the credit to ensure more units can be built.
“So one of the things that my colleague, Senator Young, and I have been working on is making that four percent a floor, if you will, on the tax credit. A fixed rate. This would help us immediately provide more affordable housing in the marketplace,” Cantwell said.
In response to Cantwell’s questioning, Mnuchin agreed with the need to fix the credit and pledged to work on the proposal.
In recent years, Washington state has experienced a severe housing affordability crisis. Between 2006 and 2015, the median income in the state increased three percent, but the median rent increased by 18%. More than 450,000 households – or nearly 17% of all households in the state – spend more than 30% of their monthly income on rent, and nearly 220,000 of these households pay more than half of their monthly income on rent. These statistics are even more drastic among extremely low-income renters in the state – 71% pay more half or more of their monthly income on rent.
Since its creation 30 years ago, the Low Income Housing Tax Credit (LIHTC) – also known as the Affordable Housing Tax Credit –has built or rehabilitated more than 3.2 million affordable housing units, leveraging more than $190 billion in private investment to do so. During that time, the credit has been responsible for nearly 90 percent of all federally-funded affordable housing. Between 1986-2013, more than 13.3 million people lived in homes financed by the Affordable Housing Tax Credit.
Senator Cantwell has been the leading champion of the program. In 2018, she secured a nearly $3 billion down payment toward addressing the affordable housing crisis, helping to build over 28,000 new units. This year, she introduced bipartisan legislation to permanently expand the LIHTC by 50 percent, which would allow 550,000 more units to be built in the next decade than otherwise possible, and strengthen critical housing protections for at-risk groups.
Here’s how many units of affordable housing the Affordable Housing Tax Credit has built in each county in Washington state since the tax credit was created in 1986.
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