Senators Agree on Housing Supply Needs, Divided on Federal Investment Levels

By: Gabriel Smith, Legislative Affairs Analyst

This week, the Senate Budget Committee held a hearing entitled, “A Blueprint for Prosperity: Expanding Housing Affordability.” In this hearing Senate Democrats and witnesses from across the affordable housing industry made the case that greater access to affordable housing supply will ultimately lead to long term economic prosperity. Senate Republicans cautioned against expanded funding without proper oversight to curb fraud, waste, and abuse of existing programs. Despite universal agreement that the housing crisis touches every part of American life and the urgency to expand access to housing, lawmakers remain divided on whether increased federal investment is enough to equitably meet demands at the state and local level. 

Several witnesses praised federal programs and partnerships between federal and state parties, but echoed calls for increased federal investment to help fill needs that state and local governments are unable to face alone. Witnesses representing federal, county, and local perspectives, offered mirroring praise for the creativity with which their respective levels of government have increased housing supply through the tools at their disposal, but all had particularly high praise for critical programs like LIHTC, rental assistance, HCV, HOME, and others signaling that improvements to the programs themselves will give them added strength to address the challenges facing the industry. 

With any hearing, there are clear messaging objectives that both sides of Congress hope to convey to their colleagues and to the public. In this hearing, the Democrat majority members make the case that expansion of existing programs and the introduction of legislation to create new ones are both vital to addressing the housing affordability crisis. Several lawmakers including Chairman Whitehouse announced that they plan to introduce new legislation while acknowledging that existing federal assistance in their current forms only goes so far. Sen. Whitehouse explained, “Our appropriations support housing programs like the Home Investments Partnerships, Community Development Block Grants, and Housing Choice Vouchers, but it obviously isn’t enough.” 

While this level of commitment from the majority is encouraging, the level of support that may actually appear in FY 24 appropriations may be undercut by Republican minority members’ skepticism of the Biden Administration’s management of HUD and the agency’s oversight of local PHAs citing extreme cases of mismanagement. Despite witnesses promptly defending the work and leadership of PHAs, overcorrection of extreme cases persists by opponents of expanded funding and programs for HUD. Further, the possibility of a divided government and new Presidential administration may also lead to tempered expectations of the desired impact the majority hopes for. Acknowledgement of the problem is helpful, and may even be an aspiring policy idea, but is not a voucher or a tax credit a family can use today. Senator Padilla explained to his committee colleagues, “the housing crisis is a crisis of supply,” and the facts bear that the demand will continue to rise, what remains to be seen is if Congressional action will rise to meet it.