Sen. Elizabeth Warren, D-Mass., is seeking to put her stamp on affordable housing with a sweeping overhaul of the current system.
The progressive icon plans to introduce legislation Wednesday aimed at dramatically increasing funding for affordable housing, while also offering financial incentives to local governments to cut back on regulations that restrict housing construction and drive up prices.
Though unlikely to see a vote in this Congress, the bill plants a marker on the issue for progressives in the event that Democrats take control of the Senate following the November midterm elections — and perhaps carves out a platform on a key issue for Warren to run on in the event she seeks her party’s presidential nomination.
The bill directs a sizable multi-hundred-billion dollar investment towards new housing for middle and lower-income individuals and families, though Warren claims the bill does not significantly add to the long-term deficit, despite raising affordable housing spending by $500 billion over 10 years. The bill would dedicate $10 billion in funding for state, county, and local governments that ease up on land use regulations.
Much of that cost would theoretically be offset by a substantial increase in taxes paid by wealthier individuals upon their death: the estate tax, often referred to as the “death tax” by low-tax advocates. Warren’s plan would undo a Bush administration cut to that tax and set new thresholds to raise taxes on the 10,000 wealthiest families in the U.S.
[Opinion: Someone needs to remind Elizabeth Warren that she is part of the 1 percent]
The combination of new spending and eliminated tax breaks would almost certainly set her at odds with Republicans, especially President Trump, whose Trump Organization also has a substantial interest in real estate development and whose family would be hit by the proposed tax increase.
Along with the support of a number of affordable housing activists, Warren’s plan claims a noteworthy supporter from the financial world: Mark Zandi, chief economist at the Wall Street financial analysis agency Moody’s.
“Low- and middle-income households are struggling to make their rent and mortgage payments, suffering through increasingly long commutes, and unable to take better jobs because they cannot afford housing near the available work,” Zandi wrote in an analysis of the ambitious overhaul, in which he argues more affordable housing will lead to greater economic growth. “[Warren’s plan] will go a long way toward addressing these problems.”
Warren’s plan also expands fair lending requirements to financial companies that don’t currently fall under the Community Reinvestment Act, a 1970s era law meant to prevent discriminatory practices in banking.
“This bill presents a vision for updating the Community Reinvestment Act that places the well-being of communities at the center of it,” said Jesse Van Tol, CEO of the National Community Reinvestment Coalition, a lead nonprofit organization on fair lending issues, in a statement. “Senator Warren has outlined a broad commitment to safer and more accessible economic opportunity in neighborhoods, communities, cities and rural areas across the country.”
