- The Build Back Better plan addresses childcare, elder care, affordable housing, and climate change.
- The affordable housing aspect of the proposed spending plan will affect low-income households, the elderly, and disabled people in need.
- Review specifics as to who will benefit from this spending plan and the programs through which the funding will flow.
The largest, most comprehensive investment in affordable housing in history
What actions does President Biden propose in his Build Back Better spending plan? Improving childcare and caregiving options, efforts to combat climate change, expanding affordable health care, and strengthening the middle class — which includes affordable homes, public housing, and rental assistance.
"The framework will enable the construction, rehabilitation, and improvement of more than 1 million affordable homes, boosting housing supply and reducing price pressures for renters and homeowners. It will address the capital needs of the public housing stock in big cities and rural communities all across America ...” — www.whitehouse.gov
The legislation passed the House of Representatives on November 19, 2021. A partial breakdown of the $1.75 trillion proposal includes:
- $555 billion aimed at fighting climate change, mainly through tax incentives for renewable and low-emission sources of energy
- $400 billion for free and universal preschool for all 3- and 4-year-olds
- $150 billion to build more than one million affordable housing units
The affordable housing aspect of the spending plan will affect low-income households, the elderly, and disabled people in need. The proposed legislation intends to create more equitable communities by investing in redevelopment projects in under-resourced neighborhoods and incentivizing state and local zoning reforms.
Let’s take a look at who could benefit from this spending plan and the programs through which the funding will flow.
Low-income households — Section 8
$880 million is earmarked for new Section 8 project-based rental assistance. Section 8 of the Housing Act of 1937 authorizes the rental housing assistance to private landlords on behalf of low-income households in the United States.
$1.77 billion is designated for energy/water efficiency and climate resiliency improvements to the Section 8 project-based rental assistance, Section 202, and Section 811 portfolios. The Section 202 program helps expand the supply of affordable housing with supportive services for the elderly. It provides very low-income elderly with options to live independently in an environment that provides support activities such as cleaning, cooking, transportation, etc. The program is similar to Supportive Housing for Persons with Disabilities.
Preservation of HUD multi-family housing
$1.45 billion is available for the preservation and improvement of HUD multifamily housing (Section 8 project-based rental assistance, Section 202, and Section 811 portfolios).
Revitalization of public housing
$65 billion is intended for revitalization of public housing.
Very low-income families, elderly, and the disabled
$24 billion is set for the new Housing Choice Vouchers program. The housing choice voucher program is the federal government’s major program for helping extremely low-income families, the elderly, and the disabled afford decent, safe, and sanitary housing in the private market. Since housing assistance is provided on behalf of the family or individual, participants are able to find their own housing, including single-family homes, townhouses, and apartments.
Rental housing for extremely low-income people
$15 billion is marked for the National Housing Trust Fund — a new affordable housing production program that will complement existing federal, state, and local efforts to increase and preserve the supply of decent, safe, and sanitary affordable housing for extremely low-income and very low-income households, including homeless families.
$10 billion is designated for the HOME program. These funds are given to states and units of general local government to implement local housing strategies designed to increase homeownership and affordable housing opportunities for low and very low-income Americans.
How CLA can help
We are here to help you navigate the complex regulatory environment of affordable housing. CLA engages with more than 500 affordable housing projects throughout the country on an annual basis and our industry professionals provide services beyond traditional tax and assurance, including consulting and outsourcing.