Whitehouse reintroduces bill to triple the low-income housing tax credit
The Rhode Island Democrat said his Affordable Housing Construction Act would increase the supply of affordable rental homes and help bring down rents. It would also extend required affordability periods from 30 years to 50.
U.S. Sen. Sheldon Whitehouse, D-R.I., has reintroduced a bill that would more than triple the federal Low-Income Housing Tax Credit, his office said Wednesday. Whitehouse argued that the expansion would help bring down rents in Rhode Island.
According to Whitehouse's office, the Affordable Housing Construction Act would make permanent a temporary 12.5 percent boost to the credit from 2018. Beginning in 2027, it would triple both each state's allocation of the credit and the minimum allocation for small states. One-third of each state's allocation would be set aside for projects that meet certain requirements, such as paying a prevailing wage, using renewable energy, being near public transportation, providing accessible units or reserving at least 20 percent of units for extremely low-income renters.
The bill would also extend the period that housing financed by the credit must remain affordable from 30 years to 50. It would lower the private activity bond threshold for the rehabilitation credit from 50 percent to 15 percent. And it would repeal what the office called the "qualified contract" loophole, which the office said allows developers to pull units out of affordability requirements early.
"Rhode Island families are paying the price for decades of sluggish housing supply investment, too often getting priced out of the neighborhoods where they want to live," Whitehouse said.
Whitehouse's office said the credit has financed 3.9 million housing units since its creation in 1986 and produces an average of 115,000 affordable rental units a year. The office said the program is oversubscribed, with too many eligible projects competing for too few funds. Citing an analysis by RIHousing, the office said the bill would bring at least an additional $68 million a year for affordable housing development in Rhode Island, creating hundreds of additional units in the state each year.
Sen. Jack Reed, D-R.I., is a cosponsor. The office said the bill is endorsed by the Rhode Island Executive Office of Housing, Housing Works RI, RIHousing, the Housing Network of Rhode Island and the Rhode Island Coalition to End Homelessness.
"Rhode Island is working to create more homes and expand access to housing that Rhode Islanders can afford, but we cannot meet the scale of this need alone," said Rhode Island Secretary of Housing Deborah Goddard.
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