Projects Developed With Low-Income Housing Tax Credit Differ From Traditional Public Housing Development Projects
T-RCED-93-54: Published: Jun 17, 1993. Publicly Released: Jun 17, 1993.
- Full Report:
GAO provided information on how public housing authorities (PHA) use the low-income housing tax credit program as an alternative to the public housing program. GAO noted that: (1) PHA use the tax credit program to serve the elderly and different types of tenants in mostly low- and middle-income neighborhoods and develop a greater variety of housing unit types than the public housing program; (2) most of the public housing units serve families with children in middle-income neighborhoods; (3) the tax credit program generates only half of the costs needed for development and requires additional federal subsidies to cover operating expenses and serve tenants with incomes comparable to tenants in public housing projects; (4) although Department of Housing and Urban Development (HUD) grants cover virtually all of the development costs for public housing projects, tax credit projects are given less federal assistance than public housing projects, are more expensive to operate, and incur greater administrative fees and returns to investors; (5) the greatest obstacles with the tax credit program is finding alternative funding sources to offset development costs; and (6) PHA believe tax credit programs are a valuable tool for augmenting the development of additional low-income housing.