The letter highlights key provisions that if included will address critical national needs.
Washington, D.C.— Today, a bipartisan group of 225 mayors from across the country sent a letter to Congressional leadership highlighting priorities and opportunities in the upcoming reconciliation bill that will strengthen the local-federal partnership and address critical issues, including the affordable housing crisis. The letter addresses the need to provide major housing tax credits to encourage new builds, protect tax exempt municipal bonds, and the restore and expand the Child Tax Credit.
The mayors write, in part: “Through our partnership with the federal government, cities have worked to create opportunity for all our residents and to attract economic development benefiting both urban and suburban communities.”
They continue later: “The reconciliation package provides Congress the opportunity to solve the nation’s housing crisis, protect tax exempt financing, fund essential community development and housing assistance programs, significantly reduce child poverty, and protect health care for the poor.”
As congressional leaders begin the process of developing a reconciliation plan, the mayors are urging them to consider the impact of policies on cities and to build on the progress that has made American cities as strong as ever.
Full text of the letter can be found here and below:
The Honorable Mike Johnson
Speaker
United States House of Representatives (LA)
The Honorable John Thune
Majority Leader
United States Senate (SD)
The Honorable Hakeem Jeffries
Democratic Leader
United States House of Representatives (NY)
The Honorable Charles E. Schumer
Democratic Leader
United States Senate (NY)
Dear Speaker Johnson, Leader Thune, Leader Jeffries and Leader Schumer:
As the nation’s mayors, we write to express the opportunities we see in the upcoming re-write of the 2017 tax law; and other components of the reconciliation bill.
At the outset, the tax bill should continue to build upon bipartisan proposals that advance the federal-city partnership that has yielded strong economic growth over the decades. US Metro cities and suburbs now are home to over 90% of the nation’s Gross Domestic Product (GDP); 88% of its jobs; 93% of economic growth; and 76% of job growth in 2024. Our metro economies provide the infrastructure and ecosystem for our nation’s future economic growth.
Through our partnership with the federal government, cities have worked to create opportunity for all our residents and to attract economic development benefiting both urban and suburban communities.
We, therefore, support the following provisions in the reconciliation bill which we believe will strengthen America and address critical national needs.
- Provide major housing tax credits to spur production including a robust expansion of the Low- Income Housing Tax Credit, creation of the Neighborhood Homes Tax Credit, tax credits to convert vacant commercial property to housing, and expansion of the Historic Tax Credit. Research shows significant increases in housing production directly correlate to reduced rents and the moderation of housing prices, exactly what is needed to address our national housing crisis. But these credits must spur sufficient production to adequately respond to the depth and breadth of our nation’s shortage of units, which we estimate to be between 4-7 million. Given the role that rising home prices and rents play in “kitchen table” inflation, we believe the production credits should be a top priority in the tax bill.
- Provide full funding of the Community Development Block Grant (housing rehab) and HOME Partnership (new construction) programs, along with increased resources for FHA mortgage insurance, rental assistance, and affordable housing programs to further address our housing crisis.
- Protect tax exempt municipal bonds, including private activity bonds, which are the main financing tool of locally funded, essential infrastructure, including transportation, water and wastewater facilities, along with housing, schools, and hospitals, to name a few. We oppose any effort to restrict this time-honored mechanism for raising local revenues to support locally driven projects. State and local governments finance 75% of the nation’s infrastructure, mostly through tax exempt financing. Removing the tax exemption on municipal bonds would cost households on average $6,500 over a ten-year period.
- Continue innovative Direct Pay energy credits within the IRS to support local government energy efficiency and conservation projects to lower energy bills. Federal investment credits and direct pay policies provide a critical incentive for leveraging investments in new and upgraded energy sources. Direct pay policies also enhance local efforts to modernize the electricity transmission grid and ensure that electricity transformers are available.
- Restore and Expand the Child Tax Credit, proven to reduce child poverty in our nation. In fact, CTC levels during our economic recovery reduced child poverty by 40%. This bill should do the same. An economically stable and secure family enriches early childhood development and emotional health; poverty yields the opposite. Expanding the CTC is an investment in the future of our children’s lives and our nation.
- Protect Medicaid benefits to ensure current levels of service and access to health care Medicaid is the principal source of health care funding for countless seniors in nursing homes in cities and rural America alike; and is a major source of health care for the nation’s children. We also want to emphasize the importance of maintaining the funding for the Supplemental Nutrition Assistance Program (SNAP) and other child nutrition programs, as they are vital for supporting child health.
The reconciliation package provides Congress the opportunity to solve the nation’s housing crisis, protect tax exempt financing, fund essential community development and housing assistance programs, significantly reduce child poverty, and protect health care for the poor.
We look forward to working with you to fashion key components of the tax and reconciliation bill that impact the American people’s daily lives and to address their most urgent needs.
Sincerely,