SacBee: GOP tax bill would kill a California tool to build housing

SacBee: GOP tax bill would kill a California tool to build housing
December 8, 2017 Joanna Rivas

Ali Youssefi, 34, and his father, Cyrus Youssefi, of CFY Development Inc. stand at their Warehouse Artist Lofts project. Youssefi is the lead developer on the 700 and 800 blocks of K Street.While California’s housing crisis has been well documented, what isn’t as widely understood are the financing tools we use to build affordable housing. One indispensable tool, Private Activity Bonds, is in danger of being eliminated in the federal tax reform. This would be devastating for the millions of low- and moderate-income Californians struggling to afford housing.  After years of hard work by housing advocates and lawmakers, Gov. Jerry Brown signed a package of housing bills in September. Like the homes it would help create, the package was built on a foundation of partnerships with the federal government. Private Activity Bonds are used in public-private partnerships and are required for developers to obtain low-income housing tax credits. These bonds and tax credits are the building blocks of affordable housing. Ending access to the tax credits would result in the loss of $2.2 billion of financing in our state each year.

 

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