Washington Wire: Affordable Housing on the Campaign Trail

Published by Michael Novogradac on Thursday, October 1, 2015
Journal thumb October 2015

Affordable housing has not been a visible part of most presidential campaigns to date, despite a growing volume of research that the nation’s shortage of affordable housing has reached crisis levels. It is possible that broader topics such as income inequality would provide an opportunity for the candidates to address their positions on affordable housing. To that end, the housing community will hold housing forums in Iowa, whose caucuses have long been the first major electoral event in the presidential nomination process, and New Hampshire, home of the first-in-the-nation primary, to engage the candidates in a conversation about the future of the nation’s housing.

Two Forums Planned

Iowa Forum

The National Association of Local Housing Finance Agencies and the Iowa Finance Authority will host a first-of-its-kind bipartisan national summit on housing policy Oct. 14-15 in Des Moines, Iowa. “Housing represents 18 to 20 percent of the national economy. On Maslow’s hierarchy of needs, shelter is a basic need,” said David Jamison, executive director of the Iowa Finance Authority. “It’s tied to so many important things, but it’s been largely absent from the presidential campaign.”

Jamison said the Building America summit will provide a safe zone for presidential candidates to discuss housing issues in a balanced and bipartisan forum. The event will feature informal, sit-down conversations with candidates, who will take questions from a politically friendly moderator.

A bipartisan advisory committee of state housing finance agency directors worked together to develop the key issues to be discussed at the summit. In addition to Jamison, the committee includes Mary Kenny, executive director of the Illinois Housing Development Authority; Mary Tingerthal, commissioner of the Minnesota Housing Finance Agency; and Ralph Perry, executive director of the Tennessee Housing Development Agency. Representatives from the Iowa Association of Realtors, the Home Builders Association of Iowa and the Iowa Bankers Association also weighed in on the issues. While the final topics and questions are still being honed, Jamison said likely topics could include the U.S. Department of Housing and Urban Development (HUD) and its programs, the Low-Income Housing Tax Credit (LIHTC) program, housing finance/government sponsored enterprise (GSE) reform, the mortgage interest deduction, the Dodd-Frank Wall Street and Consumer Protection Act (Dodd-Frank) and the associated regulatory environment, the National Housing Trust Fund (NHTF) and HOME Investment Partnerships (HOME) program. Jamison said the group will work to carefully form the final questions with the goal of eliciting an informed and enlightened response.

“After this is done, the hope is that the next president is better informed on the issues of our industry,” Jamison said. In addition to informing and engaging the candidates–and the eventual president–a secondary goal is to inform and engage Iowa caucus-goers as well as the larger national audience on important housing issues. Jamison said that while Iowa is in “a unique political position in the political process” to host an event like this, the partnership with NAHLFA was key to making sure the event is not just about Iowa.

At the time of this writing, candidates had not yet committed to participate but Jamison reported a lot of interest and “toe dipping” by the campaigns. He was optimistic that growing registration for the event would help solidify candidates’ interest in participating. The event will be free, but ticketed; within the first three days of registration, about 300 attendees had already signed up–nearly a third of the group’s goal of 1,000 likely Iowa caucus attendees. Jamison said registrants include Realtors, bankers, business people, advocates and community leaders.

If the event achieves the immediate goal of informing the next president about housing issues, Jamison said the long-term goal would be to keep the momentum going. “Hopefully this will be something that will happen every four years,” he said. Jamison is not alone in that hope. In fact, as he put it, “Something that has never happened before is going to happen twice.”

New Hampshire Forum

The J. Ronald Terwilliger Foundation for Housing America’s Families has worked to encourage presidential candidates to commit to supporting solutions to the nation’s housing crisis. Launched in June, the foundation’s stated mission is to “to recalibrate federal housing policy to address the nation’s critical affordable housing challenges of today and to meet the housing needs of future generations of Americans.”

On Oct. 16, the J. Ronald Terwilliger Foundation for Housing America’s Families and the Bipartisan Policy Center will host a New Hampshire Housing Summit to offer a platform for presidential candidates to engage in dialogue with New Hampshire business leaders about housing as an issue critical to the well-being of New Hampshire citizens and the strength of the economy. The audience will include New Hampshire residents, real estate professionals, leading economists, national political correspondents and journalists.

Featured speakers scheduled at the time of this writing include two presidential candidates: former Arkansas Gov. Mike Huckabee and Sen. Lindsey Graham of South Carolina. Other candidates are expected to confirm participation before the event. In addition, other speakers include Sen. Kelly Ayotte of New Hampshire, and former Sen. Scott Brown of Massachusetts, former HUD Secretary Henry Cisneros, former FHA Commissioner Nic Retsinas, former Rep. Rick Lazio, Mortgage Bankers Association President and CEO Dave Stevens, Chairman of Habitat for Humanity International Renée Glover and American Bankers Association President and CEO Frank Keating.

On the Record to Date

Underscoring the necessity of the forums to be held this month, there is very limited information available about the candidates’ positions about affordable rental housing in the meantime.

Republicans

  • While he has been mum on the topic to date, Donald Trump does have a connection to affordable housing: his father, Fred Trump, built and operated affordable rental housing in New York City. The elder Trump is credited with building 27,000 low-income multifamily apartments and row houses in Brooklyn and Queens.
  • In July Ben Carson wrote a column for the Washington Times in July in which he compared HUD’s affirmatively furthering fair housing rule to forced busing in the 1970s. Carson advocates a simpler tax code that includes a form that can be completed in fewer than 15 minutes and an end to the Internal Revenue Service (IRS) “as we know it.”
  • Jeb Bush released an economic plan in August but it doesn’t specifically deal with housing. According to housingwire.com, in a May fundraising event in New Hampshire, Bush said that Fannie Mae and Freddie Mac need reform and that the current housing and debt system is unsustainable. Bush calls for a 20 percent corporate tax rate and the elimination of business interest tax deductions, both of which would significantly affect the LIHTC market.
  • While announcing his candidacy in Hope, Ark., in May, Huckabee called for more resources for affordable housing such as Habitat for Humanity. However he also said “our federal policies for affordable housing aren’t designed to protect families, but to protect bureaucrats.” Huckabee wants to abolish the IRS, eliminate corporate income tax and establish a “Fair Tax,” which replaces all federal income taxes with a consumption tax on retail sales.
  • According to nj.com, in April, a state appeals court blocked N.J. Gov. Chris Christie’s attempt to balance the New Jersey state budget by seizing trust funds that towns used to build homes for low- and moderate-income residents. Christie calls for a 25 percent corporate tax rate.
  • Rand Paul advocates eliminating the entire tax code and replacing it with 14.6 percent tax on all individuals and businesses. Presumably, that would end tax credits. He proposed a federal budget in 2013 that would have eliminated HUD and several other departments.

Former Sen. Rick Santorum did cosponsor legislation during his time in Congress to expand and enhance various affordable housing programs, including the LIHTC. Lindsey Graham also cosponsored LIHTC legislation during his time in the House of Representatives. There is virtually nothing relevant to note on the record about the positions on affordable rental housing from Ted Cruz, Marco Rubio, Carly Fiorina, Bobby Jindal, John Kasich or George Pataki. We do know that Rubio calls for a 25 percent corporate tax rate; Pataki calls for a top corporate rate of 24 percent; and Santorum calls for dropping the top corporate rate to 20 percent.

Democrats

  • Hillary Clinton’s 2016 economic plan doesn’t specifically mention housing, nor did she mention housing in a July speech about her economic policy. However, Clinton does have some ties to HUD, including being consistently rumored to be interested in Julian Castro as potential running mate.
  • Bernie Sanders has been an outspoken advocate of the NHTF, calling its funding “really excellent news.” Sanders first proposed legislation to create the NHTF in 2001, according to his website. He has consistently cosponsored legislation to improve and expand the LIHTC.

Conclusion

In light of how central housing is to the nation’s economy and how essential safe, affordable housing is to the nation’s communities, it’s hard to believe that the events scheduled this month are the first of their kind. But regardless of how we got here, what these events reveal about candidates’ positions on affordable housing will be the most important takeaway.