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GOP House tax plan could hurt Delaware low-income home ownership

Delaware Public Media

The tax plan passed by the U.S. House of Representatives Thursday could hurt low-income Delawareans’ ability to find affordable housing or own a home.

The Delaware State Housing Authority uses tax-exempt financing to help developers build affordable housing developments. But the tax overhaul the House GOP approved would kill that tax break.

DSHA Director Anas Ben Addi said the change would make building and redeveloping rental units more expensive. They would have to cut back on the number of projects they help with.

“It would probably move us from being able to assist 4-to-6 projects a year to maybe 3-to-4 projects a year," he said. "So we are talking about probably an average of about 100, 150 apartments a year that we will not be able to help.”

Delaware has struggled to satisfy demand for affordable housing in the state. More than 20,000 Delawareans spend at least half of their income on rent.

Ben Addi said state assistance to homebuyers would also be impacted by the loss of the tax break.

He said low income residents may get back between $500 and $1,500 hundred in taxes under the proposed plan, but lose the chance to own their own home.

“It may be not even a wash for some of these families, they may be even harmed by reducing or eliminating some of these social programs on the housing side to give them a nominal tax savings.”

He said DSHA would have to limit its mortgage assistance services if the House plan becomes law.

The Senate’s proposal keeps the tax free financing for states.

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