The Build Back Better Act (BBB), now in Congressional negotiations, delineates the Biden Administration’s domestic social policy agenda. Its current form is a $1.75 trillion package that would increase funding, establish programs, and modify provisions across a wide array of government activities. Notably, it includes $150 billion in funding for affordable housing and community development programs intended to address some of the systemic barriers that disproportionately harm people of color and families with the lowest incomes. To these ends, the BBB Act targets funding streams for new construction, rehabilitation/preservation, rental assistance and down payment assistance, among other investments. 

These investments would improve the prospects for mobility from poverty for millions of Americans by providing them with housing choice and equitable access to wealth-building opportunities. As federal officials continue to work out the details of the plan, it’s critical that Congress prioritize housing in this package and in future bills in order to improve outcomes for people and families with critical housing and economic needs. 

Mobility from poverty consists of three core principles, defined by the US Partnership on Mobility from Poverty: economic success, power and autonomy, and being valued in community.  Achieving it requires simultaneous pursuit of five interrelated goals we collectively call the Housing Bundle. The Housing Bundle includes:

  1. Housing Quality: physical conditions of housing that support physical and mental health
  2. Housing Affordability: housing that is secured without an unsustainable financial burden
  3. Housing Stability: housing that protects against unwanted moves and life disruption
  4. Housing that Supports Wealth Building: housing that creates pathways to long term economic security
  5. Neighborhood Context: housing located in an environment that supports thriving for residents

In this blog post, we will look at BBB through the lens of economic mobility, focusing on the implications of five of the legislation’s housing proposals. 

HUD Rental Assistance

The BBB Act’s current configuration would direct $24 billion to the Housing Choice Voucher (HCV) program and support services to increase housing and economic opportunity, reduce the number of individuals and families experiencing or at risk of homelessness and reverse the effects of residential segregation in the pursuit of racial equity. This includes $300 million for competitive grants for mobility-related services and $230 million for landlord incentives.  Of this funding, $7.2 billion is slated for individuals and families experiencing or at risk of homelessness, and survivors of domestic violence, dating violence, sexual assault, stalking and human trafficking. $880 million is allocated to the Project-Based Rental Assistance (PBRA) program to support more than families with decent, safe, and affordable housing. 

Housing Choice Vouchers are portable and allow households to move to located in areas they prefer. The PBRA program designates affordable units in market rate rental properties.  These financial supports help residents with low incomes to afford stable, healthy, and safe housing, as well as other necessary expenses. They also offer households funds that permit moves to areas where job, educational, health, and other resources are available to promote increased economic mobility for current and future generations. 

Public Housing Preservation 

The legislation proposes a $65 billion investment to fully address the backlog of capital needs in public housing. It would also provide place-based grants that support communities in developing and implementing locally-driven plans to transform disinvested neighborhoods into thriving communities for all residents. 

Through repair, purchase, and construction, these investments would bring additional units of high-quality public housing online, providing durable affordability options to hundreds of thousands of  households. These improvements make it possible for more households to live in high-quality units protected from the mental and physical harms of substandard housing that can lead to health challenges, diminished academic performance for children, and lost days of work.   

Affordable and Accessible Housing Production and Preservation

The BBB Act would set aside $15 billion under the national Housing Trust Fund to support the preservation and creation of new rental homes for the lowest income households. Another $10 billion would be allocated for the HOME Investment Partnerships Program to fund the construction, purchase, or rehabilitation of affordable homes. This investment would create, repair or rehabilitate homes, provide rental assistance to low-income families, and move families into sustainable homeownership. 

These two programs connect state and local governments as well as nonprofit partners with flexible financial support to conduct a range of activities that support the ability of households to secure and maintain affordable rental and owned housing and develop robust community resources. The broad benefit of these programs is to offer long term stability for households that rent or own their homes by first creating housing and then resolving cost and practical concerns that threaten the affordability and sustainability of housing for residents with low incomes.

First-Generation Downpayment Assistance

A $10 billion funding pool would provide first-time, first-generation homebuyers with the greater of $20,000 or 10% of the purchase price of an eligible home for down payment costs, closing costs, and costs to reduce the rates of interest. Another $500 million are furnished for housing counseling agencies to help qualified home buyers meet the bill’s housing counseling and education requirements. In addition, $5 billion are dedicated to subsidize 20-year mortgages for first-generation homebuyers.

These funds would help to make affordable homeownership and wealth building possible and sustainable for households who otherwise face significant difficulties in meeting the financial and informational demands of making the transitions from renting their homes.

Community Development Block Grants (CDBG) for Affordable Housing and Infrastructure

The latest version of the BBB Act would provide $3 billion for the Community Development Block Grant program, which assists urban and rural communities by expanding economic opportunities and improving quality of life for low- and moderate-income persons. These grants include set-asides of $700 million and $500 million to address the housing and community infrastructure needs of colonias (unincorporated towns on or near the US/Mexico border) and resident-owned manufactured housing communities, respectively. 

Flexible funding from the CDBG program allows recipients to meet a considerable variety of needs. Local uses of these grants can reap benefits for residents by making repairs to bolster housing quality, as well as providing financial resources that can increase home affordability and stability. In addition, these funds can be spent in pursuit of improved conditions outside of homes that determine a range of quality-of-life factors in the communities where people live, work, worship, and play. 

Enterprise supports strong housing investments in the Build Back Better Act and encourages Congress to pass them into law. These investments will extend the possibility of mobility from poverty to more people living in this country and reinvigorate the economy with the increased participation that shared prosperity will bring.