Low-income tax loan remains necessary for transparency and reform

LIHTC provides too little housing for too much money.

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Another persistent problem, in which we speak and the act on housing price and costs are constant dominance of low income tax loans as a leading way to create new, subsidized, affordable housing. I’ve been a critic of the program for a long time, and the passage of the “great beautiful account” with his expansion of the loan just secured his life into the future. The evidence is irreversible: LiHtc housing is expensive and it takes a long time to be installed compared to similar market rates. However, the momentum behind the loan works unstoppable. Reforms and eventually a LIHTC pass must be at the top of the agenda if the country wants to move towards a residential abundance and distance from shock and housing inflation.

I wrote about the insidious influences of LIHTC. And I stressed How difficult is the loan to use effectivelyAnd I wrote about how credit can be reformed and changed In builders and households for deduction directly. The bottom line is that the apartment units of LiHTC are now approaching A million dollars per unit. There were findings from the guard agencies who found serious issues of compliance and vulnerability on credited credits and lack of transparency. Where does all the money go? One would think that tax credit would result in $ 13 billion in forgetting on tax revenues that could answer that question. LIHTC has very cloudy data on what buildings built in, where, how much it costs, and is still accessible. And routinely, I emphasize that the costs of almost any LIHTC in the country are more than the purchase price of a family home.

What is this discontinued system obtaining so much political support despite consciousness of high cost production in this way? First, politicians like to cut tape. It could look somewhat fluttered, but LIHTC projects are blitzi, new and often involve all types of bells and whistles. The costs of the building certification as crossing the legal requirements for energy efficiency, for example, see themselves as high points, not surpluses, because efficiency serves another agenda.

All of this money and complexity in the system imply the industry of consultants, trade unions, lawyers, planners, accountants and performers who are all profitable actors, earning money from sunbathing all money moving through the system. What I call a non-profit housing industrial complex relies on tax loans and multiple sources of capital compressed from the government and philanthropic sectors.

Finally, capital It is common in housing development. There may be more sources of money borrowed in the project. But when and sources of capital have different programs, design requirements and design requirements, result can slow projects and add layers of requirements that add costs on buildings. Things like the required minimum size for units can limit the unit of account in the project and increase by unit costs. It is not a question number of bedroom, but the total size of the unit; More, smaller units, even less, means more income for renting and multiple units at lower prices per unit.

Responsive LiHTC system is to start with More transparency and responsibilities. Let’s find out where all the money went and where is it going? Then some discipline per cost should be imposed. It is simply not true that accessible housing must be more expensive. Then the loan should be moved to a direct deduction program for developers involving renting limited housing in their projects that serve people with higher income and households fighting each month. This would help more people faster and spared us the construction of the apartment complexes that Mahal who make politicians, media and some advocates to feel better, but work very little to contact people on the economy margins.