Op-Ed Notes Weakened LIHTC as a Result of Tax Reform Legislation
An op-ed by Sue Reynolds, president & CEO of Community Housing Works, and Matt Schwartz, president & CEO of California Housing Partnership, published in the San Diego Union Tribune notes that the adoption of last year’s tax reform legislation has weakened the Low-Income Housing Tax Credit. The op-ed explains that the Tax Cuts and Jobs Act reduced the top corporate tax rate from 35 to 21 percent, which has reduced pricing and subsequent production for the Housing Credit.
The authors highlighted the potential impact of the legislation for the San Diego region and highlighted what the LIHTC program has accomplished thus far. According to the authors, in San Diego County, the LIHTC program has created more than 23,000 affordable rental homes and 14,000 jobs that generate $248 million annually in revenue for state and local governments. And with the reduction in the corporate tax rate, it could mean the loss of as many as 5,000 affordable apartments in the next 10 years, and the new tax law would make San Diego’s homeless and housing crisis harder to solve.
The authors encourage passage of the Affordable Housing Credit Improvement Act of 2017 to fix these losses and bolster the LIHTC for creating and preserving apartments for homeless and low-income people. This legislation would expand the LIHTC by 50 percent.