The U.S. House of Representatives passed a reconciliation package on August 12 providing roughly $433 billion in new spending over the next 10 years for climate-, energy-, and health-related provisions. Dubbed the “Inflation Reduction Act of 2022,” the bill excludes vital affordable housing investments needed to address skyrocketing rents and the severe shortage of affordable, accessible rental homes available to the lowest-income renters despite the central role housing plays in inflation. The cost of housing is the single largest component of the Consumer Price Index (CPI), a key measure of inflation, and addressing the rising cost of housing is vital to efforts to relieve inflationary pressure on households, especially in the long term.
The House previously passed the “Build Back Better Act,” which included $150 billion in targeted affordable housing investments to bridge the widening gap between incomes and rising housing costs and address the severe lack of deeply affordable, accessible rental homes. By leaving the act’s historic affordable housing investments out of the reconciliation package, Congress has missed a once-in-a-generation opportunity to address homelessness and housing poverty in the U.S.
The U.S. Senate passed the bill last week (see Memo, 8/8), and President Biden is expected to sign the bill into law this week.