SEATTLE, WA – Today, U.S. Senator Maria Cantwell (D-WA) stressed the need for more affordable rental housing in Washington state, which not only provide homes but create construction jobs and stimulate local economies. Specifically, Cantwell called for an extension of a one-year program included in the 2009 American Recovery and Reinvestment Act called the Low-Income Housing Tax Credit Exchange. The Exchange makes it easier for states to access the needed capital to move forward on stalled housing construction projects. In the past year, the program has allowed 21 stalled projects to get underway in Washington state, representing 971 housing units. Together, these projects support jobs in at least 16 communities across the state and constitute a total investment of $96.7 million.
“Affordable housing continues to be a major concern and challenge across our nation and here in Washington,” said Senator Cantwell, who held a press conference at Bakhita Gardens, an affordable housing development project in Seattle. “By building these units, we are not only providing homes for Washington families, we are also creating construction jobs and bringing investment to surrounding communities. I am proud to have helped win Senate passage of this legislation that gets stalled housing projects moving again. My goal now is to get the bill to the president’s desk so we can create immediate construction jobs right here in Washington and provide homes for those in need.”
Senator Cantwell played a key role in passing an extension of the Exchange through 2010 as a part of the Senate’s second jobs bill, the American Workers, State and Business Relief Act. The bill passed on March 10, 2010 and next goes to the House of Representatives.
The Low-Income Housing Tax Credit (LIHTC), the nation’s primary mechanism for developing affordable rental housing, is a permanent fixture of the tax code that provides a 70 percent subsidy for the development of affordable rental housing. States leverage this funding to attract private investment and move forward on housing projects. The effectiveness of the tax credit was severely hampered by the economic downturn in 2008 and 2009. The value of the credits depends on demand by the large corporate investors, and in the slumping economy, that demand dropped sharply. These large corporate investors included Fannie Mae and Freddie Mac. As a result, funding gaps arose, and tens of thousands of housing units stalled for lack of private investment capital. Senator Cantwell was instrumental in including the Exchange program in ARRA to address this absence of LIHTC private capital.