Report Finds Housing Tax Credits Promote Interests of Children
On May 15, the Center for Housing Policy released a report on state housing policies that help remediate child poverty, promote family and residential stability for children, and help families access communities of opportunity that offer good schools and other amenities that make them especially good places to raise children. The report, entitled “Reviewing State Housing Policy with a Child-Centered Lens: Opportunities for Engagement and Intervention,” found that affordable housing positively affects the lives of children and that there are numerous opportunities for state-level action to strengthen these policies and improve outcomes for children.
The report identified six ways states could best use the federal low-income housing tax credit to benefit families with children:
- Encourage the development of projects for families with children—either directly (through a set-aside or incentive)—or indirectly by encouraging the development of larger units with three or more bedrooms;
- Encourage the project-basing of housing vouchers in low-income housing tax credit sites;
- Encourage the use of low-income housing tax credits for the preservation of existing affordable rental housing for families with children, particularly when well located near strong schools or in gentrifying neighborhoods where the risk of sites opting out of affordable requirements is high;
- Encourage the adoption of “healthy homes” standards for low-income housing tax credit rehabilitation and new construction;
- Encourage family properties to be developed in good school districts or in areas with good job access; and
- Encourage the inclusion within family projects of amenities to support working families with children, such as day care centers, computer centers, and job training/placement services.
The authors also reported that increasing the use of the 4 percent credit is one way to “expand the pie” of federal resources that are available to develop affordable rental housing. But they also emphasized that the 4 percent credits are rarely enough by themselves to develop a new multifamily site and ensure the rents remain affordable to households at 60 percent of the area median income. When used alone, they noted that it will rarely be able to produce units below the maximum allowable rents, meaning the units will be unaffordable to extremely low- and very low-income families. For these reasons, they recommended that states wishing to derive maximum benefit from the 4 percent credits will need to identify other resources to layer onto it to make projects more feasible and produce lower rents. These resources can include implicit subsidies such as inclusionary zoning, as well as explicit subsidies such as HOME, CDBG, or state housing trust funds.
More like this
- Report Finds Room for Improvement in Promoting Access to Opportunity for Bay Area Developments
- Report Finds Residents Generally Satisfied with LIHTC Housing
- Study Finds LIHTC Housing Promotes Racial and Income Diversity
- Freddie Mac Reports Increase in Low-Income Housing Tax Credit Partnerships in 2009