President's Budget Proposes Increased LIHTCs, New Programs
The Biden administration recently submitted to Congress the President's budget request for fiscal year (FY) 2023. As part of the request, the budget proposes additional LIHTCs to help increase housing supply and help to stabilize housing prices over the long term.
The context: The President's budget request signals the start of the appropriations process, as Congress must now pass appropriations bills to provide money to carry out government programs for that year. The President's budget proposal serves as a fiscal indicator of the administration's policy priorities and signals to Congress what the White House hopes to accomplish over the coming years.
One level deeper: The budget proposes $50 billion in mandatory funding to increase the supply of affordable housing, including $35 billion for a new Housing Supply Fund to be administered by HUD. The Housing Supply Fund would provide funding to state and local housing finance agencies and their partners for grants, revolving loans, and other streamlined financing tools to increase housing supply, as well as grants to advance state and local jurisdictions’ efforts to remove barriers to affordable housing.
The $50 billion also includes a $10 billion investment in the LIHTC program over 10 years, which would go toward basis boosts for certain bond-financed Housing Credit developments, and $5 billion for the U.S. Department of Treasury’s Community Development Financial Institutions Fund.