Community Developments: Ensuring that Community Needs are Addressed in Opportunity Zones
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- An article in Nonprofit Quarterly explains that given the length of Opportunity Zone designation, which will last for the next 10 years, as well the estimated $6 trillion in unrealized capital gains that could be invested in distressed communities across the nation, it is critical that nonprofits and communities that could be affected by the new tax benefit become familiar with its components and ensure that equity issues are interwoven into the resulting economic development efforts. The article points out that Opportunity Zones designations are nearly finalized, making now the time to provide feedback and input, and cites an op-ed from Enterprise Community Partners President Laurel Blatchford published in Shelterforce earlier this month. Blatchford explained that Enterprise will continue to weigh in based on the kind of principles our organization outlined in a March letter to Treasury and that CEO Terri Ludwig emphasized during her Congressional testimony: 1) define abuse to protect communities and residents, and 2) establish informative annual reporting requirements. (NPQ, May 24) Learn more about Ludwig’s testimony before the Joint Economic Committee in Enterprise’s blog post and join our May 30 webinar on “State and Local Policies to Prevent Displacement and Attract Investment.”
- Yesterday President Trump signed the Economic Growth, Regulatory Relief and Consumer Protection Act into law. The bill, which passed the Senate in March and was approved in the House earlier this week, revises and removes key parts of The Dodd-Frank Wall Street Reform and Consumer Protection Act. (HousingWire, May 24) As previously highlighted in Community Developments, an analysis by American Banker identified controversial provisions in the bill, including amendments that: exempt 85 percent of banks and credit unions from Home Mortgage Disclosure Act (HMDA) reporting requirements, meaning they are no longer required to report the race, sex or credit scores of applicants, which could increase discriminatory lending; give manufactured-home retailers the ability to make financing recommendations, which could lead to lending abuses; and grant Qualified Mortgage (QM) status to loans in the portfolios of banks and credit unions with less than $10 billion of assets, which could be a return to making bad loans.
- An article in Next City notes that Massachusetts lawmakers have approved a bill that would authorize $1.8 billion in housing bonds, advancing it to the governor’s desk for final approval. The bill, which would provide $400 million for the state’s Affordable Housing Trust Fund and $600 million for Department of Housing and Community Development projects, is expected to help create at least 17,000 new housing units over the next five years. The article points out that states and municipalities have issued $894 billion in bonds over the last two years, noting that the city of Austin is considering a $161 million housing bond as part of an $816 million bond package and Californians will vote in November on a $4 billion housing bond. (Next City, May 24)
- Last week the Houston City Council voted 13-2 to require developers who receive tax abatements to commit to providing community benefits in at least one of eight areas: local job recruitment; public improvements; crime prevention through environmental design; affordable or workforce housing; job training; participation in re-entry programs; or paid internships for low-income students. According to Next City, more cities are “reassessing the ways they incentivize private development, with an eye toward extracting more public benefit in the process.” In 2016, the Philadelphia Redevelopment Authority began requiring developers to outline the “social impact” of their proposals when responding to request for proposals for developments on publicly owned land, and Minneapolis is considering requiring an affordable housing component in projects that take advantage of tax increment financing. (Next City, May 24)
In Case You Missed it
- The House Appropriations Committee voted 34-17 to approve their Fiscal Year (FY) 2019 Transportation, Housing, and Urban Development (THUD) Appropriations Bill, advancing it to a full floor vote. The bill provides $43.6 billion in net discretionary funding for HUD, which represents a $941 million increase above FY 2018 enacted levels. The House THUD Appropriations bill would: increase funding for Section 8 Housing Choice Vouchers, providing $22.476 billion, which is a $455 million increase over FY 2018 enacted levels; provide level funding for the Community Development Block Grant Program at $3.3 billion and the Section 4 Capacity Building for Affordable Housing and Community Development Program at $35 million; and allocate $50 million for a new family mobility demonstration project, which would allow families living in HUD-supported housing to move to lower-poverty, higher-opportunity areas. However, the bill would cut funding for the HOME Investment Partnerships Program by $162 million to $1.2 billion. For more information on the House THUD Appropriations bill, see Enterprise’s blog post and updated appropriations and budget chart.
- Representative Carlos Curbelo (R-FL-26) is circulating a ‘Dear Colleague’ letter asking his House colleagues to cosponsor the Affordable Housing Credit Improvement Act (H.R. 1661), bipartisan legislation that would strengthen the Low-Income Housing Tax Credit (Housing Credit). In the letter, Representative Curbelo notes that the legislation “will make the Housing Credit more flexible, simplify program requirements, support the preservation of existing affordable housing, facilitate Housing Credit development in challenging markets and for hoard-to-reach populations, and institute other modifications to make the Credit an even more effective program.” Congress enacted income averaging, a provision from H.R. 1661, in the March omnibus spending bill. Representative Curbelo now urges Congress to advance the remaining provisions of H.R. 1661 to strengthen the Housing Credit and ensure that the program will be best able to meet today’s affordable housing challenges. The ACTION Campaign urges Housing Credit stakeholders to share this letter with elected officials and ask them to cosponsor H.R. 1661.
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