Policymakers across the nation are concerned about the high costs of housing for moderate‐income families. One federal response to the problem is the low‐income housing tax credit (LIHTC), which provides income tax credits to developers of multifamily housing. Currently, Congress is considering expanding the LIHTC and adding a new middle‐income or workforce version of the credit.
Downsizing Blog
Evidence Builds Against the Low‐Income Housing Tax Credit
The Low‐Income Housing Tax Credit (LIHTC) is a federal housing subsidy that allocates tax benefits to the states for constructing apartment buildings and other projects.
Let There Be Tax Reform
The low‐income housing tax credit hands out $11 billion a year in tax subsidies, which are supposed to flow to tenants in lower rents.
Reconciliation Bill Would Expand Housing Subsidies Prone to Fraud and Corruption
The Democratic reconciliation bill includes dozens of new and expanded tax credits for businesses and other special interests.
Federal Aid Failure #12
In my upcoming Cato study, “Restoring Responsible Government by Cutting Federal Aid to the States,” I discuss 18 reasons why federal aid to state and local governments should be zeroed out. Reason #12 regards how aid induces states to delay important projects such as infrastructure.
Housing Prices, Supply, and Innovation
Housing prices have soared in many U.S. and international cities, which has generated affordability problems for middle- and lower-income families.
Community Development Aid for Beer and Burritos
Over the past two years, the White House budget called for eliminating Community Development Block Grants (CDBG) twice. If history is any indication, CDBG will once again be proposed for elimination when the budget is published next week. Most likely, Congress will reject the White House’s suggestion, as it has in previous years.
If Congress cares about helping low-income people, it isn’t clear why they would reject the White House’s suggestion, or at least why Congress wouldn’t repurpose CDBG money for activities that address low-income needs directly.
Little Political Downside in Ending CDBG
President Trump’s annual budget is slated for release March 11th. Although there are many decisions to make, the most challenging choices will likely be regarding what to cut.
HUD’s Inexperienced Bureaucrats
The Washington Post slammed Ben Carson’s Department of Housing and Urban Development today. The paper found that “loyalty eclipses expertise” in the upper ranks of the agency given that 24 of HUD’s 70 political appointees have little housing experience.
Cost and Abuse Problems in Low-Income Housing
A new Government Accountability Office report on the Low Income Housing Tax Credit echoes some of the concerns about the programs vulnerability to abuse that Vanessa Brown Calder and I suggested in a 2017 Cato report.