Domestic spending: Why Congress should invest more in housing

On Thursday, the Senate Committee on Appropriations, chaired by Sen. Richard Shelby (R-Ala.), marked up their 2019 “Transportation, Housing and Urban Development, and Related Agencies” appropriations bill.

As the full Senate begins to consider fiscal year 2019 appropriations legislation, they should continue their support for affordable homes they demonstrated in the spending bill passed in March. Then, members of Congress on both sides of the aisle voted to expand several key housing programs and wisely rejected proposed cuts to HUD’s budget.

{mosads}Now, they must do it again. Choosing this route will benefit people across the country, in all kinds of communities, because an affordable home is an essential foundation for capitalizing on opportunity.

Currently 18 million households are housing insecure, meaning they pay more than 50 percent of their income for housing, and often do so for homes that have serious problems. 

Federal housing programs are critical to families across America – to families like Jaimi’s. A working mother of two in suburban Atlanta, Jaimi struggled to meet all her family’s needs for health care, education, nutrition and housing. She spent years renting an old apartment, where recurring leaks led to mold and mildew and gave her children asthma attacks. It made her family sick, but it was all she could afford.

Jaimi and her kids would still be in that unhealthy home if not for a HUD program known as Section 4, which provides grants to community-based organizations to improve their ability to serve low-income people. It was one of these Section 4 grants that allowed an Atlanta nonprofit to develop a program that rehabilitates foreclosed homes, then sells them to low- and moderate-income families, including Jaimi’s.

Thanks to Section 4, Jaimi became a first-time homeowner in 2016, moving her family to a much better place. Today, both of her children have their asthma under control. She’s building wealth with each month’s mortgage payment. And she can now focus on other priorities in life, like studying for the bachelor’s degree she’s about to earn.

Jaimi personifies the power of an affordable home to improve health, strengthen education and increase opportunity. Section 4 grants are helping families like hers across the country, in all 50 states. Over the last seven years, they have created or preserved 61,000 affordable homes and 112,000 jobs.

The Section 4 program that helped Jaimi’s family is one of many programs that show the power of affordable, well-designed homes to improve lives. The HOME Improvement Partnerships Program (HOME) funds a wide range of activities including building, buying and rehabilitating affordable housing and providing direct rental assistance to low-income people. HOME too has an outstanding record, creating more than 1.2 million affordable homes and providing rental assistance for more than 320,000 families since the 1980s.

Both programs are enormously efficient investments, delivering consistent results while multiplying the reach of our tax dollars: HOME leverages $4 in other funding for every federal dollar invested, and Section 4 leverages a whopping $20 for each federal dollar. They are simultaneously fiscally responsible and good for the economy.

Fully funding proven programs like these is even more important because of the tax bill that became law at the end of 2017. Due to that legislation’s unintended impact on the Low-Income Housing Tax Credit, the main method our country uses to build and preserve affordable rental homes, the future supply of affordable homes will be cut by approximately 200,000 units over the next decade.

The bottom line is this: millions of Americans cannot afford well-designed homes in thriving communities. By continuing to support and strengthen the Housing Credit and vital programs like Section 4 and HOME, Congress will improve lives and strengthen communities. This will enable people to spend more on other necessities, funneling money into local economies, creating jobs and benefitting us as a nation.

The people like Jaimi who benefit from these programs are all around us. They are our neighbors, our veterans and our children. Our budget needs to reflect the fundamental importance of a place to call home.

Terri Ludwig is CEO of Enterprise Community Partners, a national nonprofit that makes well-designed homes affordable and creates vibrant communities. Enterprise is a Section 4 intermediary.