(Washington, D.C.) – Following a scathing investigative piece by the Washington Post, Congressman Glenn Grothman (R-WI) is doubling down on his call to end the Low-Income Housing Tax Credit (LIHTC). The article confirms that the LIHTC program enriches developers, banks, and lawyers while failing to effectively help the low-income Americans it was meant to serve.
“The Washington Post article exposed what we’ve known all along: the LIHTC program is not only inefficient, it’s scandalous,” said Grothman. “Projects built with LIHTC subsidies can cost up to $1.3 million per unit in Washington, D.C, far more than the average market-rate home in the city. These units aren’t modest, often including extravagant amenities in some of D.C.’s most affluent neighborhoods, and they’re mostly funded by taxpayer dollars. One developer boasted about including ‘a fitness room to encourage physical activity, a library, a large café with an outdoor terrace, a large multi-purpose community room with a separate outdoor terrace, an indoor bike room, on-site laundry, lounges and balconies on every floor.’ These luxurious amenities are costly, unnecessary for these developments, and paid for with taxpayer dollars.
“As costs rise, developers, banks, and lawyers take a bigger cut. The more expensive the project, the more these wealthy individuals profit. Meanwhile, fewer units are built because the costs are so high. LIHTC wastes taxpayer dollars and fails to deliver real help to struggling Americans. It’s a system rigged to reward developers, not the people it claims to assist. At one D.C. development, taxpayers shelled out nearly $800,000 per one-bedroom unit. Meanwhile, the same developers built a neighboring market-rate complex for about $350,000 per unit. The difference? The LIHTC-backed project generated an $8.5 million developer fee.
“This isn’t just the Washington Post sounding the alarm,” Grothman continued. “Even the Wall Street Journal is calling out LIHTC as a sweetheart deal for politically connected developers that runs through taxpayer money while producing few results.
“Despite the blatant waste and inefficiency occurring with LIHTC, the House reconciliation bill currently proposes increasing LIHTC funding by $14 billion over the next decade. This approach is far off the mark from serving the American people, and my colleagues must recognize that this program hurts taxpayers.
“I introduced the Low-Income Housing Tax Credit Elimination Act, to shut down this broken, bloated program. It’s time to end LIHTC and invest in solutions that truly help American families, not line the pockets of wealthy developers.”
