Former Senators Announce Support for Permanent Rate Floor Legislation
Last month, Congressmen Pat Tiberi, R-Ohio, and Richard Neal, D-Mass., introduced bipartisan legislation (H.R. 4717) that would encourage additional private investment in affordable rental housing. The Tiberi-Neal bill would make permanent the 9 percent Housing Credit for new construction and create a new 4 percent credit rate floor for investment in existing developments.
According to the latest data from Harvard’s Joint Center for Housing Studies, there are 11.8 million renters with extremely low incomes (at or below 30 percent of the area median) and only 6.9 million affordable rental units that are currently available in the market. While the ranks of extremely low-income renters rose by three million from 2001 to 2011, the number of affordable rentals remained essentially unchanged during this period. The affordable rental shortage will only get worse in the future absent a concerted effort to address the lack of supply, and the legislation is intended as a step in the right direction.
Recently, former U.S. Senate Majority Leader George Mitchell and former U.S. Senator Christopher Bond, co-chairs of the Bipartisan Policy Center Housing Commission, issued the following statement in response to the recent introduction of H.R. 4717:
The Low-Income Housing Tax Credit is our nation's most effective program supporting the preservation and construction of affordable rental homes. By leveraging the resources of the private sector, the Housing Credit has helped finance some 2.6 million affordable rental units since it was first created in 1986. Remarkably, the aggregate foreclosure rate experienced by Housing Credit properties over this period is less than one percent. With rents rising throughout the country and with the shortage of affordable rental housing now at crisis levels, the need for the Housing Credit has never been greater.
We commend Representatives Pat Tiberi, R-Ohio, and Richard Neal, D-Mass., for their leadership in introducing H.R. 4717, bipartisan legislation that would make permanent the 9-percent credit for new construction and create a new 4-percent credit rate floor for investment in existing developments. By establishing permanent floors on the credit rates, H.R. 4717 will introduce much-needed certainty into the marketplace that will encourage additional private investment in rental housing that is affordable to our nation's low-income families. We urge the House Ways and Means Committee to act favorably on H.R. 4717 and do so as expeditiously as possible.