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Affordable Housing Disappearing in US 10/07 06:17
LOS ANGELES (AP) -- For more than two decades, the low rent on Marina
Maalouf's apartment in a blocky affordable housing development in Los Angeles'
Chinatown was a saving grace for her family, including a granddaughter who has
autism.
But that grace had an expiration date. For Maalouf and her family it arrived
in 2020.
The landlord, no longer legally obligated to keep the building affordable,
hiked rent from $1,100 to $2,660 in 2021 -- out of reach for Maalouf and her
family. Maalouf's nights are haunted by fears her yearslong eviction battle
will end in sleeping bags on a friend's floor or worse.
While Americans continue to struggle under unrelentingly high rents, as many
as 223,000 affordable housing units like Maalouf's across the U.S. could be
yanked out from under them in the next five years alone.
It leaves low-income tenants caught facing protracted eviction battles,
scrambling to pay a two-fold rent increase or more, or shunted back into a
housing market where costs can easily eat half a paycheck.
Those affordable housing units were built with the Low-Income Housing Tax
Credit, or LIHTC, a federal program established in 1986 that provides tax
credits to developers in exchange for keeping rents low. It has pumped out 3.6
million units since then and boasts over half of all federally supported
low-income housing nationwide.
"It's the lifeblood of affordable housing development," said Brian Rossbert,
who runs Housing Colorado, an organization advocating for affordable homes.
That lifeblood isn't strictly red or blue. By combining social benefits with
tax breaks and private ownership, LIHTC has enjoyed bipartisan support. Its
expansion is now central to Democratic presidential candidate Kamala Harris'
housing plan to build 3 million new homes.
The catch? The buildings typically only need to be kept affordable for a
minimum of 30 years. For the wave of LIHTC construction in the 1990s, those
deadlines are arriving now, threatening to hemorrhage affordable housing supply
when Americans need it most.
"If we are losing the homes that are currently affordable and available to
households, then we're losing ground on the crisis," said Sarah Saadian, vice
president of public policy at the National Low Income Housing Coalition.
"It's sort of like having a boat with a hole at the bottom," she said.
Not all units that expire out of LIHTC become market rate. Some are kept
affordable by other government subsidies, by merciful landlords or by states,
including California, Colorado and New York, that have worked to keep them
low-cost by relying on several levers.
Local governments and nonprofits can purchase expiring apartments, new tax
credits can be applied that extend the affordability, or, as in Maalouf's case,
tenants can organize to try to force action from landlords and city officials.
Those options face challenges. While new tax credits can reup a lapsing
LIHTC property, they are limited, doled out to states by the Internal Revenue
Service based on population. It's also a tall order for local governments and
nonprofits to shell out enough money to purchase and keep expiring developments
affordable. And there is little aggregated data on exactly when LIHTC units
will lose their affordability, making it difficult for policymakers and
activists to fully prepare.
There also is less of a political incentive to preserve the units.
"Politically, you're rewarded for an announcement, a groundbreaking, a
ribbon-cutting," said Vicki Been, a New York University professor who
previously was New York City's deputy mayor for housing and economic
development.
"You're not rewarded for being a good manager of your assets and keeping
track of everything and making sure that you're not losing a single affordable
housing unit," she said.
Maalouf stood in her apartment courtyard on a recent warm day, chit-chatting
and waving to neighbors, a bracelet with a photo of Che Guevarra dangling from
her arm.
"Friendly," is how Maalouf described her previous self, but not assertive.
That is until the rent hikes pushed her in front of the Los Angeles City
Council for the first time, sweat beading as she fought for her home.
Now an organizer with the LA Tenants' Union, Maalouf isn't afraid to speak
up, but the angst over her home still keeps her up at night. Mornings she
repeats a mantra: "We still here. We still here." But fighting day after day to
make it true is exhausting.
Maalouf's apartment was built before California made LIHTC contracts last 55
years instead of 30 in 1996. About 5,700 LIHTC units built around the time of
Maalouf's are expiring in the next decade. In Texas, it's 21,000 units.
When California Treasurer Fiona Ma assumed office in 2019, she steered the
program toward developers committed to affordable housing and not what she
called "churn and burn," buying up LIHTC properties and flipping them onto the
market as soon as possible.
In California, landlords must notify state and local governments and tenants
before their building expires. Housing organizations, nonprofits, and state or
local governments then have first shot at buying the property to keep it
affordable. Expiring developments also are prioritized for new tax credits, and
the state essentially requires that all LIHTC applicants have experience owning
and managing affordable housing.
"It kind of weeded out people who weren't interested in affordable housing
long term," said Marina Wiant, executive director of California's tax credit
allocation committee.
But unlike California, some states haven't extended LIHTC agreements beyond
30 years, let alone taken other measures to keep expiring housing affordable.
Colorado, which has some 80,000 LIHTC units, passed a law this year giving
local governments the right of first refusal in hopes of preserving 4,400 units
set to lose affordability protections in the next six years. The law also
requires landlords to give local and state governments a two-year heads-up
before expiration.
Still, local governments or nonprofits scraping together the funds to buy
sizeable apartment buildings is far from a guarantee.
Stories like Maalouf's will keep playing out as LIHTC units turn over,
threatening to send families with meager means back into the housing market.
The median income of Americans living in these units was just $18,600 in 2021,
according to the Department of Housing and Urban Development.
"This is like a math problem," said Rossbert of Housing Colorado. "As soon
as one of these units expires and converts to market rate and a household is
displaced, they become a part of the need that's driving the need for new
construction."
"It's hard to get out of that cycle," he said.
Colorado's housing agency works with groups across the state on preservation
and has a fund to help. Still, it's unclear how many LIHTC units can be saved,
in Colorado or across the country.
It's even hard to know how many units nationwide are expiring. An accurate
accounting would require sorting through the constellation of municipal, state
and federal subsidies, each with their own affordability requirements and end
dates.
That can throw a wrench into policymakers' and advocates' ability to fully
understand where and when many units will lose affordability, and then funnel
resources to the right places, said Kelly McElwain, who manages and oversees
the National Housing Preservation Database. It's the most comprehensive
aggregation of LIHTC data nationally, but with all the gaps, it remains a rough
estimate.
There also are fears that if states publicize their expiring LIHTC units,
for-profit buyers without an interest in keeping them affordable would pounce.
"It's sort of this Catch-22 of trying to both understand the problem and not
put out a big for-sale sign in front of a property right before its
expiration," Rossbert said.
Meanwhile, Maalouf's tenant activism has helped move the needle in Los
Angeles. The city has offered the landlord $15 million to keep her building
affordable through 2034, but that deal wouldn't get rid of over 30 eviction
cases still proceeding, including Maalouf's, or the $25,000 in back rent she
owes.
In her courtyard, Maalouf's granddaughter, Rubie Caceres, shuffled up with a
glass of water. She is 5 years old, but with special needs, her speech is more
disconnected words than sentences.
"That's why I've been hoping everything becomes normal again, and she can be
safe," said Maalouf, her voice shaking with emotion. She has urged her son to
start saving money for the worst.
"We'll keep fighting," she said, "but day by day it's hard."
"I'm tired already."
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