Building Industry Wins with the American Jobs Plan

The proposed legislation is a step forward for green housing and affordability in Southern California.

By Christine Harada 

With an eye on U.S. infrastructure, environmental protection and competition with China, President Joe Biden debuted the American Jobs Plan this Spring, calling on Congress to place significant investments into rebuilding the U.S. economy. As the second part of a presidential agenda labeled “Build Back Better,” the plan focuses on job creation and improvements to infrastructure—including a focus on more affordable and efficient housing. The plan also calls for significant investments into research and development (R&D) and jobs for manufacturing.  

This plan of course represents great opportunities for builders in the Southern California area. The bulk of the jobs created by the American Jobs Plan will be in the construction, manufacturing, transportation, distribution and healthcare industries.  And that tracks for green jobs, too. Manufacturing jobs, including those in clean energy, will generate large numbers of excellent jobs for non-college-educated workers – many of whom have been left behind for the last 20 years.

For the housing industry, the American Jobs Plan would:

Produce, preserve and retrofit more than a million affordable, resilient, accessible, energy-efficient and electrified housing units.
Through targeted tax credits, formula funding, grants and project-based rental assistance, the plan would extend affordable housing rental opportunities to underserved communities nationwide, including rural and tribal areas.

Build and rehabilitate more than 500,000 homes for low- and middle-income homebuyers.
Biden is calling on Congress to pass the Neighborhood Homes Investment Act (NHIA). Offering $20 billion worth of NHIA tax credits over the next five years would result in approximately 500,000 homes being built or rehabilitated, creating a pathway for more families to buy a home and start building wealth.

Eliminate exclusionary zoning and harmful land-use policies.
Biden is calling on Congress to enact a new competitive grant program that awards flexible and attractive funding to jurisdictions that take concrete steps to eliminate such needless barriers to producing affordable housing.

Address long-standing public housing capital needs.
Biden is calling on Congress to invest $40 billion to improve the infrastructure of the public housing system. This funding would address critical life-safety concerns, mitigate imminent hazards to residents and undertake energy efficiency measures that will significantly reduce ongoing operating expenses. The plan says that these improvements would especially benefit women, people of color and people with disabilities.

Put union building trade workers to work upgrading homes and businesses to save families money.
The plan would upgrade homes through block grant programs, the Weatherization Assistance Program and by extending and expanding home and commercial efficiency tax credits. It also would establish a $27 billion Clean Energy and Sustainability Accelerator to mobilize private investment into distributed energy resources; retrofits of residential, commercial and municipal buildings; and clean transportation. These investments would have a particular focus on disadvantaged communities that have not yet benefited from clean energy investments, the plan says.

As we have long believed, housing represents a critical piece of our region’s overall infrastructure. While a lack of inventory and rising prices continue to limit opportunities for homeownership – especially for younger Angelenos and minority populations – policies like this that support nationwide housing affordability are now more important than ever.

The American Jobs Plan is not without its challenges.  For example, we will need to be prepared to address the logistics required by highly coordinated efforts between the Federal Government, state and local governments and the private sector. The programs would be funded mostly by a combination of federal grants and tax credits, but managed by the state of California, and executed at the local level in public/private partnerships. That’s a lot of moving parts, and it will be important for our community to keep our “eyes on the prize.”

Additionally, the program depends, to an extent, on the elimination of exclusionary zoning and “harmful land use practices,” which has historically limited the development of multi-family and other affordable housing units. There will certainly be some backlash. It remains to be seen if local leaders will risk facing the wrath of NIMBY-oriented constituents to participate in a program like this.

Partisan issues aside, a focus on rebuilding the infrastructure while also rehabilitating the housing market is smart economics.

Christine Harada is the Board Chair for USGBC-LA.  She was previously the Federal Chief Sustainability Officer at the White House under Pres. Obama.

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