The U.S. Senate Committee on the Budget held a hearing, “The Costs of Inaction: Economic Risks from Housing Unaffordability,” on September 25. Witnesses included the Honorable Joseph Shekarchi, Speaker of the Rhode Island House of Representatives; Paul Williams, founder and executive director of the Center for Public Enterprise; Greta Harris, president and CEO of the Better Housing Coalition; Ed Pinto, senior fellow and co-director of the AEI Housing Center; and Jack Salmon, director of policy research at Philanthropy Roundtable.
Chairman Sheldon Whitehouse (D-RI) opened the hearing by stating that housing affordability is a non-partisan issue that impacts communities across the country. He emphasized that stable, affordable housing is essential to education, employment, physical and mental health, and economic outcomes. Chairman Whitehouse highlighted his newly introduced “Affordable Housing Construction Act of 2024” and mentioned several NLIHC-endorsed bills, including the “Family Stability and Opportunity Vouchers Act (S.1257, H.R.3776),” the “Fair Housing Improvement Act” (S.1267, H.R.2846), and the “Housing for All Act” (S.2701, H.R.5254), among others. To end his introductory remarks, the Chairman urged that “inaction is not an option!”
Ranking Member Chuck Grassley (R-IA) argued that the federal government should avoid excessive government spending, an agreement echoed by many Republican senators at the committee hearing, including Senators Ron Johnson (R-WI), John Kennedy (R-LA), and Mike Braun (R-IN). Ranking Member Grassley also stated that rent control policies are dangerous, urged Congress to focus on improving existing programs, and recommended increased enforcement related to HUD.
Speaker Shekarchi emphasized the importance of producing more affordable homes, reducing regulatory barriers, expanding accessory dwelling units and housing vouchers, and providing assistance for first-time homebuyers. He endorsed the Affordable Housing Construction Act of 2024, which would expand the Low-Income Housing Tax Credit (LIHTC) program and provide additional funds for developing affordable homes. Mr. Williams proposed improving the permitting and financing process, reforming zoning laws, and increasing the supply of houses. Ms. Harris described how 10 million Americans spend half of their income on housing and how the lack of affordable housing disproportionately harms low-income and minority communities. She emphasized that the federal government must expand housing vouchers, housing trust funds, and financial intermediaries and institutions; invest more in LIHTC; and support zoning reforms. While Mr. Pinto supported the notion that lack of supply leads to unaffordability, he argued that many of Vice President Kamala Harris’s proposals would lead to overall higher prices. This point was supported by Mr. Salmon, who argued that new deficit spending would lead to higher inflation and interest rates, which would end up hurting the lowest-income homeowners the most.
Senator Patty Murray (D-WA) used data from NLIHC’s The Gap to describe the affordable housing crisis in Washington State. She urged the importance of expanding the LIHTC program, removing barriers to development, and increasing federal investments in affordable housing. Furthermore, Senators Tim Kaine (D-VA), Mark Warner (D-VA), Alex Padilla (D-CA), and Chris Van Hollen (D-MD) described multiple policies that the federal government could enact to improve housing affordability. One proposal was the Housing for All Act – introduced by Senator Padilla and Representative Ted Lieu (D-CA) – which would provide robust investments in deeply affordable housing, housing vouchers, and homelessness response services (see Memo, 2/26). Senators of both parties largely agreed on the need to reduce regulations and streamline the process of building new affordable homes.
View a recording of the hearing and read the witnesses’ testimony at: https://tinyurl.com/5yp3wuea