From coast to coast, the foundation of a thriving community is affordable housing. Making sure hardworking families have a safe and reliable place to live is essential to economic growth and to quality of life. Unfortunately, a chronic lack of supply and soaring demand has deepened America’s affordable housing shortage. This has been a serious issue for years but has been transformed into a crisis by recent events such as the COVID-19 pandemic, supply chain difficulties, rising interest rates and inflation. With over 11.6 million households nationwide paying more than half their monthly income on rent, too many families must choose between paying rent and other essentials such as food, gas or medicine. At the end of 2022, our country was 3.8 million homes short of meeting the general housing needs of Americans and 7 million homes short of housing for extremely low-income renters.
Fortunately, there is a solution with a 37-year track record of proven results and support from both Republicans and Democrats: The Low-Income Housing Tax Credit. Since its inception through bipartisan legislation signed by President Ronald Reagan, the Housing Credit has financed the production of over 3.7 million homes. Through a model of public-private partnerships utilizing private capital and private development, and a pay-for-performance structure that ensures not a dime of taxpayer money is spent until affordable housing developments are serving people in need, the Housing Credit has become our nation’s primary tool for affordable housing production. Without it, virtually no affordable housing is built.
The success of the program is laudable, and the mounting need for affordable housing means improving and expanding it has never been more critical. That is why we must enact our bipartisan bill — the Affordable Housing Credit Improvement Act (AHCIA). Every community in America is impacted by this crisis and the growing bipartisan support for the AHCIA shows it. Since it was introduced seven months ago, our House bill has gained over 200 co-sponsors equally divided between Republicans and Democrats — a remarkable feat in our current Congress. Along with the Senate companion bill, we have the support of over 40 percent of Congress.
Through the bill’s key production provisions, we will be able to finance nearly 2 million more affordable homes. One immediate need is the reversal of an unprecedented cut the Housing Credit faced at the end of 2021. Congress enacted a 12.5 percent increase in Housing Credit resources in 2018 with bipartisan support but allowed it to expire because of inaction. This could not have come at a worse time for the working families, veterans, seniors and other Americans desperately seeking affordable housing in our country. That is why we must not only reverse the 12.5 percent cut, but also increase the affordable housing supply. A key provision of the AHCIA would help by reducing the amount of bonds required for a development to access Housing Credit equity. There are thousands of shovel-ready projects on the sidelines that could immediately get under development.
Let’s be clear — affordable housing and economic prosperity are inextricably linked because a workforce needs workforce housing. There is also no job growth if workers can’t find an affordable place to live and if employers can’t find workers. We see this vicious cycle playing out in local economies nationwide. By producing stable workforce housing in a broad range of areas, from fast-growing cities to farmworker housing in rural areas, enactment of the AHCIA and addressing the affordable housing crisis is a key part of our continued economic recovery. Also, because the Housing Credit is targeted at the local level based on area median income, in many areas this is housing for teachers, firefighters, police officers and other hardworking professions like restaurant, hospitality and retail workers — all essential parts of a thriving community.
At a time of heightening division in our politics, this crisis transcends party because it affects everyone. By enacting the AHCIA, we can show that impactful bipartisan accomplishments aren’t a thing of the past in Washington. Congress has a lot on its plate, but we cannot let any more time go by without addressing the affordable housing crisis head on. We urge our leaders and colleagues to act now and not let this crisis get any worse.
Darin LaHood represents the 16th District of Illinois and is chairman of the House Ways and Means Subcommittee on Work and Welfare. Suzan Delbene represents the 1st District of Illinois and is a member of the House Ways and Means Committee.