Affordable Housing for North Carolina — Sen. Jeff Jackson
Note for North Carolina renters:
1) Due to rising COVID rates, the CDC recently extended the national eviction moratorium through October 3rd — but only for counties that are seeing “high” or “substantial” transmission. Currently, that includes the vast majority of counties in our state. You can learn more here.
2) If you are low-income, you should also know that you may be eligible for the North Carolina Housing Opportunities and Prevention of Evictions Program (HOPE) program. It provides rent and utility assistance to low-income renters that are experiencing financial hardship due to the economic impacts of COVID. You can learn more about eligibility here.
The lack of affordable housing in North Carolina comes up in every county we visit — but the reason for the lack often varies county to county.
In some urban counties, exclusionary zoning is a real constraint on housing supply.
In some rural counties, they don’t even have zoning, so we know that’s not the issue.
We’re focusing on a pro-housing policy early in our campaign because what we’ve heard from people in our county visits is that this issue intersects with almost every other issue.
Want to help working families make ends meet? Focus on making housing more affordable.
Want to help build the kind of cities that can grow sustainably, facilitate the use of mass transit, and reduce carbon pollution? That’s housing.
Want to bring children out of poverty and improve academic outcomes? Make sure they’re housing secure.
Want to reduce the racial wealth gap, which was made worse by decades of redlining? Housing.
Want to improve our ability to treat mental health and substance abuse? You need a housing-first approach to take people out of survival mode and let caseworkers know where to find them on a regular basis.
And in North Carolina, we have a particular challenge with affordable housing. Right now, we have a massive shortage of 190,910 affordable rental homes for low-income renters.
Freddie Mac sums it up like this:
The ongoing housing shortage is large and rising, in part due to the effects of the COVID-19 pandemic. Our estimates suggest that the shortage has increased 52% from 2.5 million in 2018 to 3.8 million in 2020. And given the low mortgage interest rate environment, the high demand and the need for more space, we expect this shortage to continue into the near future. In fact, the decline in entry-level supply is even more pronounced than the overall shortage. The share of entry-level homes in overall construction declined from 40% in the early 1980s to around 7% in 2019… The combination of low supply (especially entry-level) and high demand (especially entry-level) is causing entry-level prices to rapidly escalate well above overall prices, triggering affordability issues for buyers to come up with even larger down payments.
Here’s what we should do:
1. Strengthen the Low Income Housing Tax Credit
There’s a quote I like that explains just how effective LIHTC has been.
“The Low Income Housing Tax Credit is the country’s most successful affordable housing program. Since its creation, it has built or rehabilitated more than 3.5 million affordable housing units — nearly 90 percent of all federally-funded affordable housing during that time. Roughly eight million American households have benefitted from the credit, and its activity has supported 5.5 million jobs and generated more than $617 billion in wages and business income.”
That was Republican Senator Todd Young (Indiana). And he’s absolutely right. Both parties should be able to agree on the potential for expanding the LIHTC.
LIHTC is one of the strongest levers we can pull to create more affordable housing. I also sponsored similar legislation in the state Senate.
We should embrace the bipartisan appeal of strengthening the Low Income Housing Tax Credit and use it to dramatically increase the number of new affordable housing units.
2. Revive the first-time home buyer’s tax credit
If it weren’t for the G.I. Bill, I probably wouldn’t own a home. Life for my family would be very different.
We have to make homeownership more accessible for those who want it. Owning a home is one of the most effective ways for families to save money and build generational wealth.
The affordable housing crisis is enormous and will take long-term solutions to address fully. But we need to help folks now. We should re-establish a refundable tax credit for first-time homebuyers.
3. Increase funding for the Housing Trust Fund
The Housing Trust Fund provides grants to states to produce and preserve affordable housing.
Although the funds are dispersed to states as block grants — giving each state flexibility on how funds are ultimately used — states must use 80% of each annual grant for rental housing and up to 10% for homeownership.
The program is paid for by issuing a slight fee (0.042%) on Freddie Mac and Fannie Mae activity.
According to the National Low Income Housing Coalition, “Most states have chosen to use their HTF investment to build and preserve affordable rental housing for extremely low-income veterans, seniors, people with disabilities or special needs, and people experiencing homelessness.”
The HTF has proven to be an effective (and cost-effective) means to fund affordable housing solutions. We should strengthen our support for the program as was proposed by the bipartisan Johnson-Crapo housing finance reform legislation.
4. Support the Build More Housing Near Transit Act of 2021
Exclusionary zoning exists, and it’s a problem for affordable housing.
Zoning rules — like minimum lot sizes or parking requirements — often have the effect of excluding multi-family residences that allow for more housing units, denser development, and a wider range of price points for potential homeowners.
Zoning is largely a local matter, but it can be influenced by federal policy.
The bipartisan Build More Housing Near Transit Act encourages the construction of low and middle-income housing in transit-served, walkable locations. It would provide incentives for local governments who are applying for federal transportation funding to meet requirements related to building more housing along the future transit corridor.
In other words, local governments that want federal funds to help develop major transportation projects would be given a strong incentive to allow for denser development along those corridors. Denser development would facilitate the use of mass transit, allow for more sustainable urban development, and would allow more housing units to be constructed, increasing supply and creating more affordable options.
5. Support Mass and Multi-Modal Transit
There’s no way to have a full conversation about affordable housing in North Carolina without addressing the need for greater investment in mass transit options like light rail and bus rapid transit. Our state needs a federal partner that understands the value of those long-term investments in creating the density we need to keep housing affordable.
We should also think in multi-modal terms by investing in infrastructure for pedestrians and cyclists. And unless that kind of multi-modal infrastructure is incorporated in the initial planning for our transportation projects, the final result is often something that isn’t safe or practical for pedestrians and cyclists, so let’s ensure we plan with pedestrian traffic in mind.
6. Support the Legal Assistance to Prevent Evictions Act of 2020
Over 6,000 people are evicted each day — disproportionately women and people of color. Only 10% of tenants in eviction cases have legal counsel — while roughly 90% of landlords do.
Helping to provide access to legal counsel for tenants involved in eviction proceedings would reduce the number of evictions and ensure fair treatment of all parties.
Introduced by Majority Whip James Clyburn and co-sponsored by Rep. David Price, the purpose of the bill is to establish a competitive grant program to provide legal counsel to tenants in eviction cases.
According to Rep. Price, this bill “will boost the efforts of state and local organizations that are working to resolve tenant-landlord disputes and prevent unnecessary evictions in our communities.”
7. Support Community Development Financial Institutions
Community Development Financial Institutions provide affordable lending options to low-income consumers and businesses, often in rural or economically distressed areas. North Carolina has eight CDFI non-profit lenders. They serve a crucial role in helping developers for affordable housing obtain financing.
We should expand CDFI funding and strengthen their capacity to finance affordable housing developments.
Due to the particular importance of CDFIs in rural North Carolina, our state’s Rural Center has made stronger support for CDFIs one of their top recommendations in addressing rural small business growth and affordable housing.
8. End Housing Discrimination
The Fair Housing Act bans several forms of discrimination in housing, but it is incomplete. We must ensure that no one is denied housing on the basis of sexual orientation, gender identity, marital status, veteran status, or the fact that they’re using a housing choice voucher.
9. Support the Earned Income Tax Credit and the Child Tax Credit
Both of these are targeted measures designed to help working families make ends meet — and both can make the difference between a safe home and housing insecurity.
10. Support low-income housing assistance
Very low-income renters often rely on assistance to afford housing — but there’s a years-long waitlist in practically every major city in the country.
For example, Charlotte has been limited to offering assistance to roughly 4,200 low-income families for the last 20 years. This has led to a waitlist for housing assistance that is at least five years long. Nationally, approximately three out of every four people who are eligible for housing assistance aren’t receiving it.
In addition, to ensure that the assistance reaches everyone who needs it, we should ensure that discrimination by landlords against those who rely on low-income housing assistance is not permitted.
Additionally, if you are low-income, you should know that you may be eligible for the North Carolina Housing Opportunities and Prevention of Evictions Program (HOPE) program. It provides rent and utility assistance to low-income renters that are experiencing financial hardship due to the economic impacts of COVID. You can learn more about eligibility here.