Mercury News: Affordable housing in California takes hit under GOP tax plan

Mercury News: Affordable housing in California takes hit under GOP tax plan
December 25, 2017 Peter

This affordable housing development built by Mercy Housing at 1180 4th St.,
San Francisco, couldn't have been completed without the bonds and tax
credits the GOP tax plan threatens to eliminate. (Marisa Kendall/ Bay Area
News Group)The new Republican tax overhaul will likely chop plans for thousands of new affordable homes in California and further squeeze low-income renters, but experts say the impact could have been more severe. The tax law, signed by President Donald Trump last week, preserved two threatened federal programs that are key to building tens of thousands of affordable homes in California — low-income housing tax credits and tax-exempt private activity bonds. But experts estimate the new tax rules could still reduce federal funding for subsidized housing in the state by 20 percent, translating to roughly $500 million a year of projects and 4,000 new units lost. “The worst possible hits were taken out of the bill,” said Carolina Reid, assistant professor of city and regional planning at UC Berkeley. But, she added, “It does nothing to actually promote affordable housing.”

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