Free Market Frenzy

All across the District of Columbia, affordable rental units, subsidized by government programs or tax credits, will expire from their contracts requiring them to remain affordable.

This issue recently caught public attention when the Museum Square Apartment complex was suddenly set for demolition, giving its residents an ultimatum, pay $250 million for the building or move. This decision has recently been reversed, due to public disapproval and an attempt at emergency legislation from Councilmember David Catania.

There have been a host of ways the District government has gone about subsidizing the development of affordable housing, but one of the most popular has been the Low Income Housing Tax Credit program. According to the U.S. Department of Housing and Urban Development, one-third of all rental apartments constructed between 1987 and 2006 took advantage of these tax credits. Apartments subsidized through this program must keep their rents under a specified level for 15 years.

Although the Museum Square issue seems to be resolved, it has shed light on the much larger issue of expiring contracts all over the city. This may not be a big issue for all LITHC subsidized building owners, but for those in emerging areas market rate prices are just too enticing to pass up. Over next five years, 45 properties will reach the end of their mandated 15 years of affordability. These include the 224-unit Rockburne Estates in Buena Vista (expiring next year), the 406-unit Columbia Heights Village along 14th Street NW (expiring 2017), and the 422-low-income-unit Capitol Park Plaza in Southwest (expiring 2018).

The District has tools like TOPA (Tenant Opportunity to Purchase Act) to help tenants purchase their building if the owner decides to sell. However, other tools are needed to help tenants in LITHC buildings be able to afford to stay in their buildings or elsewhere if the owner decides to not renew the LITHC status for another 15 years. As the District changes, we need to create more creative and nimble policies that ensure hard-working District residents are not financially squeezed out of their homes, communities, and lives.

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