Take Action: Resist Elimination of Key Housing Tools in Tax Plan
With more than 61,000 men, women, and children going to sleep in NYC shelters tonight and countless others struggling to pay rents each month, all levels of government must fully support proven, housing solutions to address homelessness. Coalition for the Homeless and our allies have consistently called for more deeply subsidized affordable housing for New Yorkers with the lowest incomes, and our advocacy has resulted in several notable victories – such as historic commitments from the City and the State to fund a total of 35,000 units of supportive housing. Unfortunately, the fulfillment of those hard-fought housing commitments will be impossible if the House tax reform plan released this week is passed as is.
The financing of affordable housing is a complicated process, and projects usually rely on a combination of various funding streams and tax credits to build and sustain the kind of truly affordable developments that can house homeless and extremely low-income renters. Instead of expanding and improving these funding mechanisms, the newly released tax bill proposes the elimination of Tax-Exempt Private Activity Bonds, which are a key tool for financing affordable housing: One-third of all affordable housing created or preserved in New York City’s much-touted affordable housing plan is financed with Private Activity Bonds and the 4% Housing Credits they generate.
The tax reform plan, “The Tax Cuts and Jobs Act (HR 1)”, released by House Republicans yesterday proposes the elimination of Tax-Exempt Private Activity Bonds which generate as-of-right 4% Low Income Housing Tax Credits (LIHTC). Over a 5-year period, housing bonds have created more than 140,000 jobs across the state. This program is critical to affordable housing development and preservation in New York. The elimination of Private Activity Bonds or “volume cap” would be a devastating blow to affordable rental housing in New York as well as to affordable homeownership opportunities for many first-time homebuyers receiving home financing through the State of New York Mortgage Agency (SONYMA). While the 9% LIHTC program would be retained, it will be weakened by the lower corporate tax rate, requiring more subsidy in projects and none of the bi-partisan reforms to the program found their way into this bill. Additionally, New Markets Tax Credit and Historic Tax Credit are also repealed in this bill – they are often used to support community development and/or affordable housing projects.
Elimination of this program will devastate NYC’s affordable housing plan and will certainly impede plans recently announced to expand it. Similarly, Governor Cuomo’s statewide housing plan with emphasis on supportive housing for the homeless will be severely impacted.
If developers cannot finance this desperately needed affordable housing, the homelessness crisis will only worsen as New Yorkers languish in shelters. Take action against this catastrophic proposal today:
Please join us in advocating against the elimination of Private Activity Bond!
- Call your member of Congress and also call NY Republicans, especially Rep Tom Reed (23rd) on the Ways & Means Committee linked here: Members of Congress
- Tell them that the elimination of tax-exempt bonds would hurt low-income renters in need of affordable housing.
CALL TODAY as this bill is moving quickly!