Trump Budget Means Big Cuts To Affordable Housing Programs

SACRAMENTO, Calif. (AP) – Cuts to affordable housing funding in President Donald Trump’s proposed budget would be devastating to California, Democratic state lawmakers said Friday, stressing that the White House’s plans increase pressure on them to address the state’s housing crisis.

Trump’s budget blueprint calls for more than $6 billion in cuts to the federal Housing and Urban Development Department, including eliminating Community Development Block Grants and reducing money for public housing.

The blueprint likely faces weeks of negotiations and has already drawn opposition from some Republicans and Democrats in Congress, which must approve the budget. But it still has California lawmakers worried.

The average California home costs about two and a half times as much as the average U.S. home, and average monthly rent in the state is 50 percent higher than the rest of the country, according to a Legislative Analyst’s Office report from 2015. An estimated 1.5 million California families lack access to affordable housing, lawmakers said Friday, and the state has disproportionately high rates of homelessness.

“This is a housing crisis that preceded Donald Trump, but it is about to be exacerbated by our president,” Assemblyman David Chiu, D-San Francisco, said at a news conference. “More homeless will die on the streets of Los Angeles, San Francisco – the streets of California – if he gets his way. This is why it is important for us to act.”

California lawmakers for years have failed to pass major legislation to address the housing crisis. This year, legislative leaders identified housing as a priority, but the issue is perennially challenging because it draws many competing interests with different ideas about how to address the problem.

Trump’s promised reductions to domestic spending and cuts to the corporate tax rate would reduce available money for individual affordable housing projects by millions of dollars, said Holly Benson of Abode Communities, a Los Angeles group that builds housing for low-income people. If the Legislature doesn’t act, the proposed federal cuts would severely hamper affordable housing creation.

“We would do a lot less new construction,” if state lawmakers fail to address the problem this session, Benson said. “If we don’t have assurance that there are funding sources there at the end of the day to fund these projects, we are not going to take those risks. We are not going to create new housing.”

Chiu, who chairs the Assembly’s housing committee, has said the Assembly is considering roughly twice as many housing bills this session as it did at the beginning of the previous session. More than 130 housing bills have been introduced in both houses of the Legislature. They include proposals to fund affordable housing through fees on real estate transaction documents and cutting mortgage interest deductions on vacation homes. Another proposal would put a proposition on the 2018 ballot for a $3 billion bond to fund affordable housing.

Over the past few years, the Legislature has tried to subsidize units for low-income Californians using General Fund revenue. Gov. Jerry Brown has generally opposed those plans, instead favoring approaches to streamline housing construction by curbing local regulations that slow building and increase costs.

Some of the Legislature’s proposals attempt to streamline construction by removing development restrictions in cities that fail to meet housing production goals and by creating incentives for cities to build housing near public transportation.

In his state budget proposal, Brown stressed the importance of building more housing and said he would work with the Legislature to achieve that goal. But “any new funding should not rely on the General Fund,” he cautioned.

 

Copyright 2017 The Associated Press.

Comments

One Comment

  1. I’m here for research, which is why you might be seeing me a lot lately.

    And to leave a response about this article.. we are definitely not in a housing crisis.

    Yours truly,
    RP

  2. Perhaps if all the illegal aliens in California are deported, a large amount of affordable housing will open up.

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