Study Finds LIHTC May Increase Political Participation

Published by Michael Novogradac on Wednesday, July 2, 2014 - 12:00am

While much has been written about the economic and housing affordability benefits of the low-income housing tax credit (LIHTC), a recent paper, “Fighting Poverty, Mobilizing Voters: Housing Investment and Political Participation,” by Dr. Claudine Gay of Harvard University suggests a potential benefit of the LIHTC program that has not been as well explored: increasing political engagement. The draft paper, presented recently at New York University (and cited here with the author’s permission), says, “As the number of LIHTC subsidized housing units in a county grows, so too does the proportion of the voting age population turning out to vote in gubernatorial and presidential elections.”

Although the paper’s results are preliminary, and may change due to revisions, the initial findings are intriguing. Dr. Gay found that the construction of 1,500 units over four years increased voter turnout in a county by half a percentage point on average. In the overwhelming majority of counties, turnout increased by more than half a point. In the average county, each additional LIHTC unit developed resulted in as many as 0.6 additional voters. Dr. Gay writes that because the effects on voter turnout are strong enough to be detected on a county wide level, it is likely that the gains are not caused by shifting low turnout voters from one area to another. In fact, Dr. Gay suggests that one major reason why LIHTC boosts political engagement and turnout is that investments in new and rehabilitated housing can change the behavior of the residents who lived in the county prior to the LIHTC construction or rehabilitation. The paper finds that LIHTC housing improves neighborhood quality, making it easier for residents to get involved, boosts the perception that local government is relevant and important in the daily lives of residents, and offers local leaders the opportunity to spotlight their successes in the community, mobilizing voters.

So, to the long list of benefits created by the LIHTC program, such as increases in property values and reduction in violent crime, we may be able to add increased engagement in the civic process. This is important in the context of tax reform, as certain proposals such as the tax reform discussion draft released by House Ways and Means Chairman David Camp, R-Mich., could reduce the amount of LIHTC units produced and in turn, prevent a potential increase in political participation.