Biden, Yellen Urge Local Officials To Spend Billions In Remaining Federal Aid On Housing
Biden and Treasury Secretary Janet Yellen, speaking to hundreds of local officials Tuesday at the National Association of Counties' Legislative Conference in D.C., said one of the administration's top priorities for how that money should be spent is affordable housing.
"We urge you to use the rescue plan money to make communities safer, to invest in affordable housing, get small businesses back on their feet, train your workforce," Biden said in his Valentine's Day speech at the Washington Hilton hotel.
As of June 30, large cities and counties — those with over 250,000 people — had spent $15B of the $65B they were allocated from the ARPA law, according to the National Association of Counties, meaning they have billions of dollars left to spend. A NACO report analyzing projects through Dec. 31, 2021, found that $979M had been spent on housing.
New guidance released in early 2022 from the Treasury Department, which is implementing the program, provided more flexibility to use the relief funds for long-term investments such as affordable housing programs.
Atlanta this month had to return $10M in emergency rental assistance funding after it wasn't provided to residents by a December deadline. Local officials at the conference responded that the funds could be difficult to access for municipalities with small staffs.
Yellen, speaking earlier in the day, said the administration has two top areas where it urges counties to invest the remaining relief funds: workforce development and affordable housing.
"The goal is to close the housing supply shortfall by 2027," Yellen said, sparking a round of applause.
The Treasury secretary discussed the Housing Action Plan the Biden administration released in May. The plan's pillars included incentivizing local jurisdictions to allow for more housing density, launching new financing programs for small-scale housing production, expanding federal programs like the Low-Income Housing Tax Credit and disposing of federally owned land to help create housing.
"As part of this action plan, we announced a series of steps that would make it easier for our recipients to use state and local fiscal recovery funds for affordable housing construction and preservation," Yellen said. "This includes permitting governments to use these funds to fully finance long-term affordable housing loans."
Yellen said that as of last year, state and local governments had budgeted over $14B of recovery funds for over 1,800 projects focused on housing.
"And this is just the beginning," she said.
She cited the example of New Hanover County, North Carolina, which has announced the development of a 278-unit apartment complex that is scheduled to break ground this year.
Multiple commercial real estate leaders told Bisnow last month they want to see the Biden administration take more action on housing issues in the remaining two years of his term. While the Republican takeover of the House may limit Biden's ability to pass more major legislation, the president said the full impact of the bills he signed — including the infrastructure bill, the CHIPS Act and the Inflation Reduction Act — has yet to be felt.
“I’m really optimistic for the year ahead as we implement the laws we’ve already passed," Biden said toward the end of his speech. "If we didn’t pass another single thing, the things that are going to take place just by implementing laws we passed last year will have real benefits to people.”
Travis County Judge Andy Brown, the top elected official in the Texas county that includes Austin, spoke at the conference Tuesday before Biden cited his county as an example of one spending relief funds on housing. Brown said the county received $247M in ARPA relief funds and used half of that to provide housing for people who were previously homeless.
"We invested funds in a consortium of local in nonprofits working with private entities to not just build housing but provide a sustained funding model to provide ongoing supportive services," Brown said. "These investments will help build 2,000 units, housing around 3,000 people in Travis County, and none of this would have been possible without the Biden administration and the rescue act funding."
While billions of federal dollars are available for local jurisdictions, some counties have had a difficult time accessing the money.
Marguerite Pridgen, director of federal policy at the Corporation for Supportive Housing in New York, told Bisnow she has been at the conference since Saturday and housing issues have come up in nearly every session.
She said many county officials have said they don't have the resources to put together applications for money that is disbursed at the state level.
"Some counties don’t have teams of grant writers and people to access that, and it can be hard to figure out how to get it from the state," she said. "They like the idea of all the money that’s out there, but sometimes it’s a lot of trouble to get to it. That was the theme."