BY REP. KEITH ELLISON (D-MINN.) AND DIANE YENTEL, OPINION CONTRIBUTORSThe recent report from the National Low Income Housing Coalition (NLIHC), Out of Reach: The High Cost of Housing, illustrates why President Trump’s budget proposal is so shortsighted and cruel. The report’s key findings—there is no state, city or country where a minimum-wage worker can afford to rent a modest two-bedroom apartment—affirms that rent is out of reach for not only minimum-wage workers but also for average renters earning $4.83 below the national Housing Wage.
Take, for example, Asma. She’s a Somali immigrant in Minnesota who is proud of her newly earned citizenship. She’s optimistic about her family’s future, but the cost of housing is eating up nearly half of the precious little money she and her husband earn each month. They must pay rent first — before diapers, medicine or food. Asma and her family are not alone. Despite the growing need, Congress has failed to address the affordable housing crisis. Under President Trump’s budget, our already tight housing resources would be slashed.
The Trump administration’s proposal would take affordable housing resources away from more than 250,000 families, seniors and people with disabilities struggling to make ends meet to help pay for tax cuts for millionaires and billionaires. The administration claims these unconscionable funding cuts are needed because we cannot afford these investments. That’s simply not true. We already have the resources and solutions to effectively end homelessness and housing poverty for millions of families. We just need the political will to do what is right.
Each year, Congress spends $200 billion to help house American families. Three-fourths of these resources go to help subsidize the homes of the highest-income households through the mortgage interest deduction (MID) and other homeownership tax benefits. This means that we spend more to subsidize the homes of the richest 7 million households, who earn more than $200,000 a year, than to assist the 55 million lowest-income renters, those with the greatest and the clearest needs.
Today, federal housing resources serve approximately 5 million low-income households, but the needs of millions more go unmet. Due to chronic underfunding, only one out of every four eligible families receives needed rental assistance. The national Housing Wage of $21.21 per hour for a two-bedroom apartment indicates that the average full-time worker earning the minimum wage will need to work 117 hours per week to afford a modest two-bedroom rental home. The high cost of housing has resulted in more than 11.2 million severely cost-burdened renter households spending more than half of their income on housing. This is wrong.
NLIHC and the United for Homes campaign supports Rep. Keith Ellison’s Common Sense Housing Investment Act (H.R. 948) to realign federal housing expenditures to better assist households that face the greatest challenges finding decent and affordable housing.
H.R. 948 reforms the MID and reinvests the savings to help more families struggling to pay their rent. In fact, under the plan, 25 million low- and moderate-income families who own their homes will receive a tax break. More than $241 billion will be reinvested into proven solutions to ending homelessness and housing poverty, like the national Housing Trust Fund, rental assistance and other affordable housing investments. All without adding costs to the federal government.
This smart tax reform proposal is more important than ever. The affordable housing crisis is hitting rural, urban and suburban communities alike, as well as people of all ethnicities, cultures and faiths. NLIHC has found that more than 7 million extremely low-income families do not have an affordable place to call home and half a million people are living on the street, in shelters, or in their cars on any given night. The problem is systemic and is reaching almost epidemic proportions. Rents are soaring in every state and community at the same time when most Americans haven’t seen enough of an increase in their paychecks.
This is unacceptable. We can and must do better as a nation, because everyone deserves a safe place to live and no one should be forced to give up food and necessities to keep a roof over their heads. The best way to right this wrong is to protect existing affordable housing investments from any further budget cuts and make smart, modest reforms to the MID to invest scarce resources to provide families stable, affordable and decent housing. For the millions of families like Asma’s, it is the lifeline they need.
Ellison represents Minnesota’s 5th District and Yentel is president and CEO of the National Low Income Housing Coalition.