DC Council Approves 2022 Budget Increasing Affordable Housing Spending

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The D.C. City Council voted unanimously on Tuesday to approve the final piece of the district’s $17.5 billion 2022 budget — upping spending on affordable housing and homelessness.

The budget increases spending on housing and homeless services, payments to low-income residents and spending on violence interruption programs, and trims spending on police, DCist reported. But the council rejected a last-minute proposal to include a 35-year, $140 million tax abatement for developers who convert vacant downtown office buildings into housing, The Washington Post reported.

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Mayor Muriel Bowser has said she plans to sign the approved budget, which increases the funding for the Housing Production Trust Fund — an organization charged with building and preserving affordable housing in the city — to $400 million, from $100 million, over the next two years to build 2,800 housing units, according to DCist. Another $17.7 million is dedicated to preserving affordable housing, and $50 million is directed toward repairing public housing.

It also incorporates funding for a proposal by Councilmember Robert White to purchase existing rental units to convert them to permanently affordable housing by subsidizing the rents for residents. 

By raising taxes on residents who make more than $250,000 a year, the budget also raises funds to help pay for permanent housing for the more than 3,000 people experiencing homelessness in the city, DCist reported. 

But the final version of the budget did not include a proposed $4 million annual tax abatement to incentivize the redevelopment of vacant office buildings, according to a statement from the City Council. The credit would have benefited developers who converted office buildings in the downtown and Golden Triangle business improvement districts into workforce affordable housing and residential space, according to the statement.

The council plans to hold hearings next year on standalone legislation to implement the tax abatement program, which was criticized by lawmakers for not going far enough to create affordable housing units, The Post reported. The proposal, from Councilmember Brooke Pinto, meant that 20 percent of the new housing created would be affordable for residents who made less than, or equal to, 80 percent of the region’s median family income — about $100,000 for a family of four, The Post reported. 

The proposal was similar to one from Bowser in her 2021 budget proposal, which would offer the same amount of money annually for the construction of affordable housing developments with roughly 33 percent of the units designated as affordable, The Washington Business Journal reported. Pinto did not immediately respond to a request for comment.

The budget also included $88 million in aid for the city’s hospitality industry, part of which can be used to pay overdue rent, per DCist

Celia Young can be reached at cyoung@commercialobserver.com.