A Federal Perspective: Time for Texas to Move the Nation on Affordable Housing

Like it or not, as Texas goes, so goes the nation.

By Debra Guerrero, The NRP Group (TAAHP Past President)

Gail Collins not only penned this phrase but wrote an entire book about the phenomenon. Many may not always like the results, but it does frame the importance of our great state and the impact our housing industry can have in the national narrative. Given the strength of the Texas market, burgeoning economy, and demand for affordable housing our state has much to gain by not only directing its influence to obtain its share of resources but also to expand them.

Federal housing tax credit financing programs have enjoyed diverse bipartisan support from our federal elected officials. Even amid an international pandemic, 2020 was a banner year for the Affordable Housing Credit Improvement Act (AHCIA) with the passage of one of the most important initiatives — the minimum 4 percent credit rate for housing tax credits. According to Novogradac, this change is expected to finance 130,000 additional affordable rental homes over ten years. But there is still much more to do to ensure that production of affordable housing continues to meet the demand of our nation’s seniors, families, and children.

The AHCIA of 2021, reintroduced in April, further strengthens and expands the low-income housing credit. Key provisions include a 50 percent LIHTC increase over two years, a reduction of the 50 percent bond financing threshold to 25 percent, and various credit boosts for specific priorities. Additionally, other significant sections will focus on removing barriers to affordable housing preservation, streamlining program rules to promote efficiency and allowing the program to better serve rural and special populations. The passage of this bill will result in 2+ million additional affordable homes over the next decade.

Nationally, Texas receives the 2nd largest number of 9 percent tax credit allocations. This significant position indicates that Texas should embrace opportunities to be at the table where national tax credit policy is drafted, forge political support and ultimately lead in implementation once adopted. Further, due to its policy influence with tenured leaders in Congress, Texas can, and should, be leading the way beyond tax credits with similar emphasis on all policy areas surrounding affordable housing.

Currently, the AHCIA is the predominant federal affordable housing legislation being considered. It’s champions include Senators Maria Cantwell (D-WA), Todd Young (R-IN), Ron Wyden (D-OR), and Rob Portman (R-OH), as well as House Representative members Suzan DelBene (D-WA), Jackie Walorski (R-IN), Don Beyer (D-VA), and Brad Wenstrup (D-OH). If AHCIA is successful, the likelihood is that these representative states will benefit by affecting provisions that support their respective interests.

So where are our Texas leaders?

Texas is a powerful voice on its own, and if there was ever an opportunity to impact this national conversation, it is NOW! Texas is indeed fortunate with the recent appointment of former Congressman Kenny Marchant (R-TX) by Governor Greg Abbott to the Texas Department of Housing and Community Affairs (TDHCA) Board of Directors. As a former member of the Congressional Committee on Ways & Means and as one of the original co-sponsors of the AHCIA, former Rep. Marchant was a critical voice representing Texas in national affordable housing policy. With his formidable policy credentials and new role as a member of the governing board overseeing housing for Texas, we have a wonderful opportunity to make great strides as key participants in the national development of affordable housing policy.

Much as Congressman Marchant did with his 16 years of service, it is essential that our current Texas delegation of Senators and Representatives become armed with housing data, facts, and rationale for them to support our industry. If the pandemic and weather crises have made anything abundantly clear, it is that affordable housing sits at the intersection of health outcomes and economic resurgence. The constraint for both of these fundamental needs is supply.

The 2020 Census reports that Texas’ population will top 29 million (a 16 percent increase from the last census) and with almost 50 percent of Texans experiencing some level of housing cost burden by spending more than 30 percent of their income on rent, the crisis in Texas is very real. Even with an economy that is once again showing signs of life, the most recent National Low-Income Housing Coalition Gap Report shows Texas is on the lower end of the affordable housing supply scale with just 29 units available per 100 Extremely Low Income (ELI) renters.

Our 38 congressional members must stand up for Texas and be counted among those who support investment in our state’s future success. However, this engagement cannot be expected unless our industry leads the way by providing the arguments and recommended policies to educate our elected officials on the importance the public-private initiative under the tax credit program as well as all other resources that support affordable housing development. Every one of TAAHP members’ properties are a testament to the success of these programs and house families who are becoming self-sufficient and thriving.

The premise is simple. Housing is a major component in so much that makes our community richer. It is our role to help our leaders understand the impacts of how investments in affordable housing directly link to greater economic growth by providing a safe and secure place for our populations to live, work, and play. With these opportunities, our communities will experience continued economic development, greater health outcomes, higher educational attainment, and overall long-term sustainability.

So, let’s activate and engage. Texas has the power to expand its economic prowess through affordable housing, but nothing will change if we only act as individuals and not with the growing strength of our industry. Let’s demonstrate the dire needs, the program adjustments, and the greater good our members provide every day. Let’s show that we can multiply our successes across the state and across the nation by being the tip of the spear of change where everyone wins. Join with your TAAHP colleagues to lead the nation in advocating for the programs we all know are solutions to the affordable housing crisis. We need your help. Sign up for TAAHP advocacy alerts at taahp.org/advocacy-action-center. If you have relationships with legislators or have donated to campaigns, fill out the “Who Do You Know” form so we can leverage those relationships. Your engagement is critical to our success.