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Q&A
Federal funding and tax credits for affordable housing development
0:37:34
·
150 sec
Acting Commissioner Tigani delves into the specifics of federal funding and tax credits for affordable housing, highlighting recent developments and potential improvements in the system.
- Tigani explains the importance of low-income tax credits in financing affordable housing projects.
- He discusses ongoing advocacy efforts to modify federal rules, such as reducing the required percentage of project funding from tax credits from 50% to 25%.
- Tigani mentions recent positive developments in the House Ways and Means Committee, including potential increases in tax credits that could significantly boost affordable housing production.
- He also touches on local challenges, such as the multiple steps and costs involved in getting permissions for affordable housing projects.
Ahmed Tigani
0:37:34
Rather than build two or three very expensive projects, we've been able to leverage federal, state, and local resources to finance tens of thousands of units.
0:37:45
That involves the use of low income tax credits, one of the nation's most innovative solutions to building affordable housing, creating millions of units nationally.
0:37:54
We use our own city capital.
0:37:56
We use federal funds like the HOME partnership funds to build senior housing.
0:38:01
On the federal piece, and I think we've discussed this before, the low income tax credits are a really important program, but we've been advocating for years that some of the rules around it makes it harder to do what I just described, is maximize the money we have to spread it out effectively to do more projects, to get more projects through the pipeline.
0:38:21
They have within the rules a requirement that 50% of that project needs to be funded using low income tax credits.
0:38:32
We have advocated to bring that basis point down to 25, basically cut in half.
0:38:37
Last year there was a bill that if it had went through at the federal level would have allowed us to finance another 4,400 units of affordable housing.
0:38:49
I will say just twenty four hours ago in the House Ways and Means markup of in the reconciliation, they included a budget item that says that they are going to move forward not only with reducing they want to propose moving forward not only with reducing the 50 to 25, but also increasing the 9% tax credit which is a even more advantageous tax credit that we use for expensive deals by increasing that by 12%.
0:39:18
So by making the efficiencies at the federal level, it actually lets us use our capital more efficiently to fund more projects and move more projects through the pipeline.
0:39:28
So we're going to follow that.
0:39:30
There's at least a hundred sponsors.
0:39:32
It is a strong bipartisan bill and we had good conversations in DC about what we can do to support that to move forward.
0:39:38
And then on the local level, think a lot of things that make it difficult is how many different steps people have to go through and how much it costs to go through those steps to get the permission that they need for affordable housing.
0:39:52
And we're looking through that and trying to figure out how to move through it.
0:39:55
And as you point out staffing continues to be a piece of it, but we're working to make investments, train up the staff that we have, put them in a position to work through projects.