Given that Joe Biden is now the odds-on favorite to become the presidential nominee of the Democratic Party, it may time to take a closer look at his plans for housing. This article focuses on aspects of his housing plans that apply to multifamily housing.
More is better
Overall, Biden plans to increase spending on housing related programs by $640 billion over 10 years. He plans to cover the cost by raising taxes on corporations and large financial institutions.
Many elements of Biden’s plan seek to expand existing programs. For example, the plan seeks to increase funding for the Low-Income Housing Tax Credit (LIHTC) program by $10 billion. The plan also seeks to increase funding for the Housing Choice Voucher program (section 8) so that all eligible applicants can receive a voucher. Currently, it is estimated that only one in four renters who qualify for assistance under this program actually receive it.
Biden plans to increase funding for the Housing Trust Fund (HTF) by $20 billion, paid for by increasing taxes on Fannie Mae and Freddie Mac. According to HUD, the existing HTF provides funds which “may be used for the production or preservation of affordable housing through the acquisition, new construction, reconstruction, and/or rehabilitation of non-luxury housing with suitable amenities. All HTF-assisted units will be required to have a minimum affordability period of 30 years.” Eighty percent of HTF grants are used to support rental housing.
The USDA’s Multi-Family Direct Loan program, which provides support for housing in rural areas, would be expanded under the Biden housing plan.
Biden’s plans also contain a number of new initiatives, many of which require legislation to be passed in order to be implemented.
The Biden housing plan would require all landlords to accept renters using section 8 vouchers to pay part of their rent. Currently some landlords choose to not accept these renters because of the compliance costs of participating in the section 8 program.
Biden supports legislation that would create a federal program to provide legal assistance to all renters facing eviction.
Biden calls for the creation of a new Renter’s Tax Credit as proposed by the Terner Center, that would be available to low-income renters who make too much money to qualify for the section 8 voucher program. The credit would subsidize their rent so that the total of their rent and utility payments would not exceed 30 percent of their income. Biden would allocate $5 billion per year to this program.
The Biden housing plan would create a government run credit reporting agency that would seek to broaden the sources of credit scoring, such as by including rent and utility payment history. The first objective of the program is to allow more people to get credit scores. Another explicit goal of the program is to eliminate racial disparities in credit scores.
Nationalizing housing policy
Biden also plans to get the Federal Government involved in areas which have been under the control of local governments in the past. These include zoning where Biden supports a bill that would eliminate “exclusionary” zoning. It does this by mandating that high density and multifamily zoning be allowed, that off-street parking requirements be eliminated, that density bonuses be given for the inclusion of affordable housing, that height restrictions be eliminated, lot size restrictions be relaxed and other measures. The bill also prohibits source of income discrimination and prohibits landlords from asking about renters’ criminal histories. Jurisdictions that failed to comply would be denied participation in certain Federal block grant programs.
In addition, a Biden administration would bring back disparate impact analysis in assessing discrimination claims. This is a system where a screening process that only considers non-racial factors like income, job history and criminal record, could be considered discriminatory if it resulted in outcomes that differed by racial group. This sort of analysis had been used during the Obama administration but had been de-empathized under the Trump administration.
Biden also pledged that in his first 100 days in office, he would commission a task force to explore making housing a government guaranteed right.
This description of candidate Biden’s plans is not comprehensive. The plans also cover addressing home ownership issues and homelessness. The full Biden Campaign housing program outline may be found here.