GILLIAN FLACCUS, Associated Press
PORTLAND, Ore. (AP) — Municipal governments worry the tax overhaul in Washington, D.C. could chill the construction of affordable housing as homelessness reaches a crisis point on the West Coast.
Officials with the housing authority in Portland, Oregon, said Tuesday the U.S. could lose nearly 1 million units of affordable housing over 10 years if the final bill eliminates the tax-exempt status for a type of bond commonly used by developers to finance affordable housing.
That estimate comes from a recent analysis by Novogradac & Co., a San Francisco-based accounting firm that specializes in real estate and affordable housing issues.
While the tax bill is not finalized, developers are now racing to lock in financing and the uncertainty over the bonds has raised upfront costs for some projects, affecting projects from Oregon to Massachusetts to Illinois to Minnesota. The concern comes at a time when homelessness is soaring on the West Coast amid an acute shortage of affordable housing. Cities, including Portland, are rushing to get projects in the pipeline to address the crisis.