Affordable housing is a big focus of Biden’s infrastructure plan - Affordable Housing Online

Affordable housing is a big focus of Biden’s infrastructure plan

By on April 8th, 2021

Tagged As: Editorials

Photo by osha.gov

President Biden’s $2 trillion infrastructure plan — The American Jobs Plan — will rebuild the nation’s aging infrastructure. It will create millions of good paying jobs, support the shift to a clean energy economy, address longstanding racial equity issues, and invest heavily in affordable homes for low-income renters.

The proposal has billions of dollars for roads, bridges, and public transit needs. It will repair 20,000 miles of roads, the 10 most economically critical bridges, and 10,000 small bridges. Transit hubs and other public buildings will be repaired and upgraded.

In addition, it supports manufacturing improvements, research and development, and supply chain support to help make America more economically competitive. The plan will also speed the shift to clean energy technologies in the fight against climate change.  It will upgrade the nation’s digital infrastructure and give everyone access to affordable broadband.

President Biden’s plan treats housing as infrastructure. If businesses are to grow, workers need decent, affordable places to live. Affordable housing is one of the largest items in the proposal. 

40% of the plan’s climate and clean infrastructure investments are supposed to benefit disadvantaged communities. The plan also calls for investments in rural communities and places impacted by shifts to a clean energy economy, such as former mining towns.

Here are the proposals in the American Jobs Plan that will have the most direct impact on low-income renters:

Affordable Housing

Low-income renters will benefit most directly from the plan’s investment in affordable housing. President Biden commits $213 billion to affordable housing. This is almost twice the amount proposed for repairing roads and bridges.

The funds will be used “to produce, preserve, and retrofit more 2 million affordable and sustainable places to live.” The units will be built and upgraded through a combination of “grants, formula funding, targeted tax credits and project-based rental assistance.”

$40 billion has been designated to repair Public Housing. Appropriations for the Public Housing Capital Fund have lagged behind need for decades. This has left an aging public housing stock with years of deferred repairs. The new funds will replace critical systems like boilers and roofs, they will also be used for accessibility and safety improvements. Most importantly, the funds will be used for energy efficiency upgrades at Public Housing properties.

Biden’s plan also calls for building and rehabilitating more than 500,000 homes for low- and moderate-income buyers. The plan calls for $20 billion in tax credits to support building and fixing the homes. This will provide many low-income renters the chance to become homeowners.

President Biden also calls for local governments to remove exclusionary zoning and harmful land use practices. Exclusionary zoning includes not allowing any multifamily rental development by zoning most of the residential land for single-family homes. Other examples include requiring large lot sizes or features like two-car garages. These requirements often put new homes out of reach for low-income buyers.

The plan proposes creating a competitive grant program. Local governments could receive flexible funding for a variety of community needs if they take concrete steps to remove barriers to affordable housing.

The plan also will extend affordable rental opportunities to underserved areas, including tribal lands and rural communities.

Universal Broadband

The American Jobs Plan proposes revitalizing the nation’s digital infrastructure. It proposes $100 billion to connect every household to high-speed broadband.

The coronavirus pandemic highlighted how much we have come to depend on the internet. The president’s plan observes that in today’s society, access to high speed broadband is almost as essential as water and electricity. 

Many disadvantaged communities have limited access to reliable and affordable broadband. Many rural areas are not wired, and internet service is too expensive in many markets for low-income renters.

Low-income renters without broadband access face challenges finding jobs and apartments. Without internet access, students cannot do remote schooling. Also, more rental assistance and supportive service programs are using online applications than in previous years.

In-Home Care

The largest item in the plan is $400 billion to improve in-home care. The plan expands eligibility for seniors and disabled persons to access care and stay in their homes. The plan also provides incentives to increase the pay of caregivers. This move has significant gender and racial equity impacts, as the majority of care-givers are female and a large portion are minority. Raising caregiver pay will benefit many low-income renters, especially those with children.

Clean Drinking Water

The president’s plan wants access to safe, clean drinking water to be a right for all Americans. The plan calls for $66 billion to improve drinking water, storm water, and wastewater systems  It also provides $45 billion to replace all lead pipes and service lines.

Programs for Workers

When the country shifts more to a clean energy economy, many workers in outdated industries will lose their jobs. An example is the loss of jobs in the coal industry, as countries take steps to reduce greenhouse gas emissions. 

President Biden is proposing $40 billion for a Dislocated Workers Program. The program would provide sector-based job training in high-demand areas, like clean energy, manufacturing and caregiving. This would help workers get jobs in expanding industries that pay well.

How Will the Government Pay for the Plan?

President Biden proposes to pay for the American Jobs Plan by raising the corporate tax rate from 21% to 28%. The corporate tax rate had been lowered from 35% in the 2017 Trump tax cuts. Corporations would still be paying lower taxes than they did five years ago.

What Happens Next?

The American Jobs Plan is just a proposal. House of Representatives staff will be drafting the actual legislation. It may also change more once the bill is discussed in committees and debated on the House floor.

It will likely pass in the House, and then face challenges clearing an evenly divided Senate. Democrats may use the budget reconciliation process to push the bill through without Republican votes. This is how they passed coronavirus relief in American Rescue Plan.

President Biden has tapped five cabinet members to help push the legislation through Congress, including HUD Secretary Marcia Fudge. The other members of his “Jobs Cabinet” are Transportation Secretary Pete Buttigieg, Energy Secretary Jennifer Granholm, Labor Secretary Marty Walsh, and Commerce Secretary Gina Raimondo.

The secretaries will represent the president when dealing with Congress. They will also engage the public when seeking support for the plan. They are the administration’s key officials for working out details as the legislation is drafted and revised.

Published by

Chris Holden

Chris Holden, Affordable Housing Online's Senior Housing Analyst, has been in the affordable housing field for 25 years. Originally from Keene, New Hampshire, he has worked as a researcher, policy analyst, lender, trainer and real estate developer. He also taught political science at Keene State College. He is focused on making housing policies more accessible for low-income renters.