California's Low-Income Housing Crisis Could Get Worse Under GOP Tax Plan #realestate #investment #homeownership

Source:  KPCC

The Republicans federal tax cut proposal would have a "devastating" impact on California's affordable housing and homelessness crisis, experts say.

GOP members of the U.S. House of Representatives released an initial proposal Thursday that would drop the corporate tax rate from 35 percent to 20 percent, and enact a host of other changes.  Also in the plan:  the complete elimination of a set of programs that currently fund about 40 percent of affordable housing construction in the country, along with financing for community centers and health clinics.

The largest of these proposed cuts calls for the elimination of tax-exempt private activity bonds, which developers use to finance construction for developments benefiting low-income people.  Without the tax-exempt bonds, California stands to lose about $2.2 billion in funding for affordable housing construction each year, said Matt Schwartz, CEO of California Housing Partnership Corp.

"We're going to lose over 20,000 affordable homes annually if this bill becomes law," Schwartz said.  "That's over two-thirds of our production that would be wiped out.  And that would be just a devastating blow at a time when we were just hoping to start making progress again."

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