Issue #148, Winter 2006

2006 Housing & Community Development Victories

In 2006, housing advocates across the country scored numerous legislative victories in their states. From new funding sources for housing trust funds to improving local tax credit regulations, policies are now in place to promote the production of affordable housing, protect residents from displacement and help low-income workers afford their housing. Here are some of the highlights.

Compiled By Nichole Brown

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In Kentucky legislation passed that allows the state's Affordable Housing Trust Fund to receive $6 in recording fees on 23 instruments, including deeds and mortgages - a victory attributed to broad grassroots mobilization, including that of the Homeless and Housing Coalition of Kentucky. Advocates believe this will provide $4.3 million or more in funding each year.

Rental Assistance Programs
New Jersey advocates, led by the Housing and Community Development Network of New Jersey, convinced Governor Jon Corzine (D) and other state legislators to approve a 50 percent increase in the state's Rental Assistance Program - from $25 million to $37.5 million. It is expected to provide housing vouchers for 1,250 additional families in 2007.

Connecticut's Rental Assistance Program (RAP) received a $1.8 million increase, bringing its annual budget to $15.9 million - enough to serve more than 1,800 households, thanks to the hard work of the Connecticut Housing Coalition. Connecticut legislators also added $250,000 to the Security Deposit Guarantee Program (now totaling $1 million) to provide a guarantee to landlords in lieu of a traditional deposit. Program eligibility had been limited to families at imminent risk of homelessness, but the new funding will allow the program to be expanded to households receiving RAP or Section 8 assistance.

Housing Bonds
In California, voters approved a $2.85 billion housing bond that will provide resources to build emergency shelters, affordable homes and housing-related infrastructure throughout the state. Advocates, led by Housing California, waged a months-long campaign to win voters' support. The bond will provide support for the Multifamily Housing Program, Emergency Housing Assistance Program, Supportive Housing Program, Farmworker Housing Grant Program, Cal-HOME Program and the California Homebuyer Downpayment Assistance Program.

The Housing Network of Rhode Island helped convince voters to approve a $50 million, four-year bond for affordable housing production by an overwhelming 66 percent. Forty million dollars will be targeted to rental production and the remaining $10 million will assist people at 80 percent of median income move into homeownership.

Tax Credits
Because of the efforts of the Affordable Housing Coalition of South Carolina, the state legislature passed a bill that standardizes rules for developers of tax credit properties. In some counties, the value of the tax credits was treated as income, which increased property assessments, and therefore taxes. Under the new law, federal or state income tax credits for low-income housing are not to be factored in valuing land and buildings for state property tax purposes.

The Connecticut Housing Coalition scored a significant victory with the doubling of the state housing tax credit. The new state budget increased available credits in the Connecticut Housing Tax Credit Contribution Program from $5 million to $10 million annually. The program provides a dollar-for-dollar tax credit to businesses that contribute to nonprofit-sponsored affordable housing initiatives.

The Vermont Affordable Housing Coalition and its allies worked with legislative leaders to increase the state's affordable housing tax credit from $150,000 to $300,000 in 2007 and to $400,000 in 2008. This five-year credit will raise nearly $1.8 million in equity.

Predatory Lending Protections
Under pressure from the Coalition on Homelessness and Housing in Ohio, the Ohio state legislature passed a sweeping anti-predatory lending bill: one of the most comprehensive in the nation, with rules regulating flipping, prepayment penalties, coercion of appraisers and other unscrupulous manipulation of circumstances. The final bill requires the mortgage lending industry to adhere to the state's consumer protection law, meaning brokers and lenders will have to work in "good faith" for home buyers. The law gives powers to the state attorney general and to county prosecutors to press criminal charges, and consumers are given the right to sue for uncapped damage awards. The names of loan officers who violate the new laws will be collected in a database and made available on a Web site. The bill passed with overwhelming majorities in both Republican-led houses of the legislature.

Housing Commitments
The Vermont legislature reaffirmed the long-standing state Consolidated Plan housing priorities, emphasizing permanent affordability, family housing and the needs of Vermont's lowest-income citizens. The legislature rejected a proposal of Governor Jim Douglas' (R) administration to divert funds from Vermont's HOME funding, which the state uses to help create permanently affordable housing, to short-term rental assistance.

Governor Rod Blagojevich (D) signed several bills in the 2006 legislative session that were priorities of Illinois housing advocates, including the Comprehensive Housing Planning Act, which turned into law a 2003 executive order of the governor requiring the state to develop an annual Comprehensive Housing Plan. The purpose of the plan is to coordinate and streamline the allocation of available housing resources in order to prioritize the development of housing for underserved populations, such as people at-risk of homelessness and people with disabilities.

Because of the work of the Homes for New Jersey coalition, Governor Jon Corzine (D) committed to build or preserve 100,000 homes for low-income residents in the next decade. The governor made a public announcement while delivering the keynote address at the semi-annual meeting of the Housing and Community Development Network of New Jersey.

South Carolina state legislators approved the creation of an Affordable Housing Study Committee in the lieutenant governor's office. Although Governor Mark Sanford (R) vetoed the bill, the House and Senate both voted to override the veto.

Eminent Domain
Following on the heels of the Supreme Court decision in 2005 supporting the use of eminent domain for economic development purposes, legislators around the country introduced measures to strengthen or weaken the use of eminent domain. In the last election, eight ballot measures that focused solely on restricting eminent domain - Florida, Georgia, Michigan, New Hampshire, Nevada, North Dakota, Oregon and South Carolina - passed. All but Georgia's banned the taking of property by eminent domain if it is going to end up in private hands, though some built in exceptions for things like health and safety. Others also specified that economic development is not an acceptable public purpose for eminent domain, increased compensation requirements and increased administrative hurdles. But thanks to the efforts of progressive coalitions, three out of four attempts to piggy back "regulatory takings" onto eminent domain outrage failed. Only Arizona passed a law containing regulatory takings. California, Idaho and Washington rejected such measures.

Minimum Wage
Labor, religious and community advocates have continually pushed for a higher minimum wage. This year their efforts resulted in increases in 11 states, by $1 or higher in seven. Arizona, $6.75; Arkansas, $6.25; California, $7.50 ($8.00 in 2008); Colorado, $6.85; Massachusetts, $7.50 ($8.00 in 2008); Michigan, $7.40 over two years; Missouri, $6.50 per hour, except for certain agricultural employees and employers, if certain conditions are met; Montana, $6.15, only for employers whose annual gross sales are more than $110,000; Nevada, $6.15, only for employers who do not provide health benefits; North Carolina, $6.15; Ohio, $6.85; Pennsylvania, $7.15, for businesses with more than 10 employees (effective in July 2008 for businesses with fewer than 10 employees). Other states with increased minimum wages: Delaware, $6.65 ($7.15 in 2008); Hawaii, $7.25; Illinois, $7.50; and New York and New Jersey, $7.15.

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