WASHINGTON, D.C. - Congressman Mike Flood called a hearing of the Housing and Insurance Subcommittee of the 119th Congress to order saying America is not building enough housing to meet demand.

He said a rise in house prices since 1995 creates affordability challenges.

 Flood: “Young people saving up to buy their first home are renting for longer, middle class workers are struggling to make the rent and Americans today feel less secure about their financial future because their bills are going up.”

He encouraged the subcommittee to explore root causes of the pricing problems. He said the problem isn’t that people aren’t making enough money or saving enough money, nor is it a lack of government spending on federal programs.

Flood: “The reason for high housing costs is simple, we are not building enough homes in this country to meet demand. Some estimates put the gap between housing supply and demand at around 3.85 million units nationwide. Some put it even higher at more than 5 million units.”

Rep. Flood said the subcommittee will consider barriers to construction including government regulations, costs of materials and labor and financing.

Columbus City Administrator Tara Vasicek joined the “Building Our Future: Increasing Housing Supply in America” hearing as a witness.

Vasicek said Columbus has made significant increases in housing production, but its proactive approach has not been enough.

She said efforts include removing barriers in city regulations.

Vasicek: “Many cities have regulations that limit housing density, Columbus does not. Accessory dwelling units, mixed use types are allow by right in all zones.

We have changed our codes to make in-fill development and adaptive re-use easy to complete. Our local permitting process is efficient. All housing permits are issued within two weeks of the city receiving a completed application.

“Currently the city is leading a workforce housing development subdivision. There are currently 325 housing units of various densities being constructed, six times the units being constructed a short time ago.

The other major financial tool used for this project, tax increment financing or TIF, is similar to tax abatement in other states.

 

Vasicek: "TIF allows for the capture of up to 15 years of property taxes paid on the project’s improvements to use as funding to build out the project. TIF is the most efficient tool available to Nebraska communities for housing development.

“In addition to TIF, the city allows allocation of a portion of local sales tax to economic development. Primarily this funding goes to housing.

“We have also been successful in securing many grants. We currently have a significant revolving loan fund, which acts as a short-term gap financing for workforce housing projects.”

She said some federal grants have requirements that limit the number of builders willing to participate. She listed obstacles to development, including local land prices, time-consuming government regulations and EPA storm water management policies.

Vasicek urges Congress to provide funding to communities that have reformed housing regulations.

Mike Flood is the founder and an owner of Flood Communications and News Channel Nebraska.