House Appropriations Chair Frelinghusyen Votes Against Tax Overhaul Bill
On December 19, 2017, the U.S. House of Representatives voted 227-203 to pass the Republican tax overhaul bill. The New York Times tracked how every representative voted.
On December 20, 2017, the U.S. Senate voted to pass the tax bill. New Jersey’s two U.S. Senators Cory Booker (NJ-D) and Robert Menendez (NJ-D) voted against the Senate tax bill which now must go back to the House.
Twelve Republicans voted no and all but one of the Republicans was from California, New Jersey or New York. In New Jersey’s House delegation, four of the five Republicans representing New Jersey voted no except for U.S. Representative Tom MacArthur (NJ-R-3.)
President Trump can now sign the tax overhaul into law.
It would have taken 23 House Republican “no” votes for the bill to fail and only 13 House Republicans voted against the original House version of the tax plan. All Democrats voted against the bill.
“The people of New Jersey already carry an extremely heavy tax burden. They need and deserve tax cuts. Unfortunately, H.R. 1 caps the federal deduction for state and local taxes (SALT) which will lead to tax increases for far too many hardworking New Jersey families,” Frelinghuysen said in a statement. “This legislation will also damage our state’s housing market and business environment,” he added.
According to The Hill, “Speaker Paul Ryan (R-Wis.) and his leadership team discussed removing Frelinghuysen as chairman of the powerful Appropriations Committee after he broke with the party line last month on the tax bill.”
The tax bill will:
exacerbate income inequality,
dramatically increase deficits, and
could lead to cuts to vital safety net programs like those for affordable housing and homelessness prevention.
While the bill preserves the Low Income Housing Tax Credit (Housing Credit) and private activity bonds – a notable achievement by affordable housing advocates – it fails to expand or reform these programs to better serve people with the lowest incomes.
Moreover, lowered corporate tax rates will lessen the value of the Housing Credit, reducing by over 200,000 the number of affordable homes produced and preserved over the next ten years.
The bill redirects housing dollars generated from reforms to the mortgage interest deduction to provide deeper tax breaks to corporations and high income people.
The massive unpaid-for tax cuts for wealthy individuals and corporations in the tax bill increases the national debt by at least $1 trillion over a decade.
This significant increase may trigger automatic funding cuts to the national Housing Trust Fund and will put future investments in affordable housing at HUD and USDA – as well as other federal resources that help struggling families meet their basic needs – at risk of deep spending cuts.
Speaker of the House Paul Ryan (R-WI) and other Republican leaders are already advocating for partisan legislation in 2018 to reduce and restrict Medicare, Medicaid, and other critical safety net programs in an effort to address the growing debt.
NLIHC President and CEO Diane Yentel stated, “This bill will exacerbate our country’s already yawning income inequality and will harm efforts to end homelessness and housing poverty. . . . At a time when we should be increasing investments in solutions to the housing crisis impacting low income people across the country, the increased deficits created by these tax cuts put the national Housing Trust Fund and other vital housing and community development programs at risk of deep spending cuts down the line.”
Overall, the tax bill misses a once-in-a-lifetime opportunity to expand housing investments to address homelessness and housing poverty through the tax code.
The bill lowers the amount of a mortgage eligible for the mortgage interest deduction (MID) from $1 million to $750,000 for newly purchased homes, but instead of reinvesting the savings into affordable rental housing where the need is so great, it uses these housing dollars to provide deeper tax cuts for some of the wealthiest individuals in the country.