May 3, 2017

Community Developments: Tax Reform, Energy Efficiency, OCC Leadership

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  • At the AHF Live Forum in New Orleans last week, Emily Cadik of Enterprise, Bob Moss of CohnReznick, Jeff Whiting of CREA and David Gasson of the Housing Advisory Group and Boston Capital discussed the possibility of tax reform and its impact on the Low Income Housing Tax Credit (Housing Credit). While the potential for tax reform and a corporate rate reduction have created some uncertainty in the Housing Credit market, it is extremely unlikely that Congress will approve the President’s proposed plan to lower the corporate tax rate to 15 percent, said the speakers. According to Cadik, the best way to protect the Housing Credit right now is to get legislators out to communities and properties in their districts. (Affordable Housing Finance, May 2)
  • As the city’s largest landlord, the New York City Housing Authority (NYCHA) needs to focus on cost-effective ways to improve energy efficiency in the hundreds of buildings it manages, writes Judi Kende, vice president and New York market leader at Enterprise, in a letter to the editor of Crain’s New York Business. NYCHA knows how critical it is to reduce energy usage, but it needs resources to do so. According to Kende, this is one of many reasons why the proposed federal cuts to public housing funding are troubling. (Crain’s New York Business, May 1)
  • Comptroller of the Currency Thomas J. Curry will step down on Friday, May 5 and Keith A. Noreika will serve as Acting Comptroller of the Currency. Noreika is currently a partner at Simpson Thacher & Bartlett LLP and was a partner at Covington & Burling, specializing in banking regulation. (Office of the Comptroller of the Currency, May 3) Reportedly, Noreika will serve on an interim basis until a permanent replacement is confirmed. (Politico Pro, May 3)
  • During his tour of HUD-assisted properties in Columbus, Ohio, last week, Secretary Ben Carson met with residents and local officials, who explained the importance of HUD programs, some of which were eliminated in the president’s proposed skinny budget. In an interview, Secretary Carson acknowledged that some people, like the elderly and the disabled, require housing assistance, but he was resolute in his belief that government assistance can lead to dependence. Housing officials also discussed with the secretary the evidence-based shift to “Housing First,” a policy that stably houses people who are chronically homeless or suffer from mental illness or substance abuse, allowing them to successfully connect with supportive services. Previously, people were required to be clean and sober before gaining access to housing, but “Housing First” has been shown to more effectively keep people healthy and stably housed. (The New York Times, May 3)
  • Homelessness prevention has emerged as a major strategy of Los Angeles County’s homeless initiative, with the goal of assisting families on the verge of homelessness by providing temporary rental assistance, security deposits, moving expenses and legal aid. This strategy was tested in a $2 million pilot program last year and continues on a limited basis with a grant from the county’s Department of Public Social Services. County officials acknowledge that it is still early to measure the success of the program; however, initial results show that of the 228 people who have exited the program, nearly 80 percent obtained permanent housing. (Los Angeles Times, May 3)

  • An article by Richard Florida in CityLab explores the challenges that sprawling suburban patterns present for individuals as well as the economy. As previously reported in Community Developments, one in four suburban residents are poor or nearly poor and economic mobility in the suburbs is significantly lower than in denser cities. While housing is often less expensive in the suburbs, high transportation costs and long commuting times disproportionately burden low-income residents. Florida also argues that suburban sprawl is costly to the economy broadly. Infrastructure and vital services like water and energy can be 2.5 times more expensive to deliver to the suburbs than to urban centers. According to a 2015 study by the London School of Economics, sprawl costs the U.S. economy roughly $1 trillion a year. (CityLab, May 2)

  • An analysis by Trulia shows that the housing recovery has been uneven across America’s largest 100 metros. According to Trulia, the share of homes that have recovered to their pre-recession peak value range from less than 3 percent in Las Vegas and Tucson to over 94 percent in Denver, Oklahoma City and San Francisco. Currently, only 34.2 percent of homes nationally have recovered to their pre-recession peak, and the metros with the strongest income growth between 2009 and 2017, such as San Francisco and Seattle, have seen the largest share of homes surpass their pre-recession peak values. (Trulia, May 3)

  • A report by the Centers for Disease Control and Prevention (CDC) shows that the life expectancy gap between black and white Americans has narrowed over the past 17 years, as the death rate for black Americans dropped by 25 percent between 1999 and 2015. However, the report shows that health disparities still persist, as black Americans in every age group under 65 continue to have significantly higher death rates than white Americans, and their life expectancy remains four years less than that of white Americans. (The Washington Post, May 2)

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