Federal Housing Policy Outlook - 2017 & Beyond: Event Recap
Since the election in November, many have been considering what a Trump Administration might mean for housing policy and practice in the next four years. Last Tuesday, California Housing Consortium and the Terner Center for Housing Innovation welcomed over 100 people to Oakland to explore this question in a panel discussion titled, Federal Policy Outlook: 2017 and Beyond." The panel brought together housing experts Michael Novogradac of Novogradac & Associates, Chris Gouig of Alameda County
, Matt Schwartz of California Housing Partnership Corporation, Carol Galante the I. Donald Terner Distinguished Professor in Affordable Housing and Urban Policy and the Faculty Director of the Terner Center for Housing Innovation, and was moderated by CHC Policy Director Marina Wiant.
The morning's discussion focused on the implications of impending changes in federal leadership in housing, speculated on the nature and implications of tax reform, and assessed potential changes to major housing programs. Questions from the audience, which included members of the development community, state and local policy and advocacy organizations, and a range of others,
enriched the conversation with an exploration of how these changes may affect local practice and policy-making here in California.
The panel began with a discussion of the expectations for the incoming Administration, transition timing, and next level appointments at the Department of Housing and Urban Development (HUD) that may influence the direction of the agency and what it might be able to accomplish. One panelist noted that the appointment of Dr. Ben Carson as Secretary of HUD, while unsettling for many who are concerned about his lack of qualifications, may actually indicate that a major overhaul of the department may not be a high priority of the incoming Administration. Further, the panelist pointed out, many past HUD secretaries haven't had a deep expertise in housing policy or program administration, and the next level appointments within HUD - where much of the expertise is often concentrated - will be just as important to watch.
The conversation continued with an exploration of the prospects for major tax reform and how it will affect the market for tax credits, especially the Low Income Housing Tax Credit (LIHTC).
Panelists expect, LIHTC to be affected by possible tax reform, as one panelist noted, "Lowering the corporate tax rate to 15% or 20%, could lower the investor equity price per credit by as much as $0.10-$0.20. We now live in a time where the new 'normal' is - we don't know the rate and the market and investors adjust as they see fit." Major tax reform could be seen in July at the earliest, if at all. One panelist noted that LITHC is showing its power already by adjusting, reacting and responding and doesn't expect it to see any major cuts because of the strength of the
advocacy activated around the preservation of LIHTC.
The dialogue then shifted to the future funding of certain HUD programs, a concern on many attendees' minds. Panelists agreed that housing subsidies for a number of major programs such as HOME and CDBG are at risk in the upcoming years, but some - such as Project Based Section 8 Housing - are less likely to be targeted for cuts by this Congress and Administration. Beyond funding, there are likely to be programmatic changes within existing programs, such as job requirements and time limits in public housing. A brief discussion on the Affirmatively Furthering Fair Housing rule suggested that while it may face some hostility and resistance in implementation, its roll back or repeal would be a slow and difficult process, and unlikely to transpire, at least in the short term.
Audience members engaged panelists on a range of questions, including what opportunities and reason for optimism the new Administration might present. As one panelist noted, plans for investment in infrastructure present one potential opportunity to tap into new sources of funding that might be tied to housing development. Meanwhile, some programs that have relatively strong bipartisan support, such as the Rental Assistance Demonstration (RAD) program, may be expanded and made permanent in the near future. Ending on a "cautiously optimistic" note, panelists noted that while the housing community may not face a great expansion of programs and resources in the coming four years, sustained advocacy efforts and capitalization on new opportunities may
allow housers to hold ground and continue to do their important work in 2017. To these efforts, CHC looks forward to engaging with you throughout the year.