>> Even as polls find more Americans warming up to President Trump's tax reform, there's one sector that is stone cold to the changes, developers and advocates of affordable housing. That's because most affordable housing projects across the US are funded by a tax credit, which allows corporations to get a tax break for investing in affordable housing nationwide.
So when the corprate tax rate was slashed from 35 to 21% in December the value of those tax credits fell dramatically. Hurting every facet of affordable houseing development.>> If you're involved in lending, investing, building, owning or managing affordable housing it just got a lot harder.>> Real estate lender, Greystone, says the tax credit program helped to produce roughly 3 million rental units since its inception in 1986.
Now it's a lot harder.>> A lot of projects now have a gap, whereas they were previously able to finance the development 100% with the tax credits and the bonds. They now need additional sources of capital. And so there are a lot of projects that are going back to municipalities, and they're looking for additional subsidy.
>> Experts say the changes in tax reform could mean a sharp drop in affordable housing units over the next decade, compounding an existing shortage. In not state in this country can someone working fulltime at the federal minimum wage afford a two bedroom apartment at fair market rent. So this is a crisis of really national proportions.
And what that means is that we have to use every tool, advocate the types of policies to increase the resources and not diminish them.>> A scaling back by investors could hurt the most vulnerable New Yorkers like folks who live at this post-war building in the Bronx, which was revamped in 2017 partially through funding by the tax credit.
>> They're working families from sort of municipal type jobs, nurses, a lot of healthcare stuff. To sort of people really struggling to get by and make their ends meet.
Law makers on both sides of the aisle in Washington have recognized the problem. Democratic Senators Maria Cantwell of Washington and Republican Orrin Hatch of Utah have sponsored a bill to increase the number of low income housing tax credits by 50% to encourage new construction.
But until then, those who build affordable housing and those that depend on it have a reason to worry.