Amid Military Housing Crunch, Lawmakers Propose Incentive for Developers to Build Near Bases

Hoping to provide service members more affordable housing options near military bases, a bipartisan pair of House members wants to offer developers a tax incentive to build that housing.

A bill being introduced by Reps. Blake Moore, R-Utah, and Marilyn Strickland, D-Wash., would offer a low-income housing tax credit, or LIHTC, to developers who build housing within 15 miles of large military installations. The bill would also exclude service members' housing allowance from income calculations for the purpose of qualifying for low-income housing.

"We have to fix the way we think about solving some of these problems," Moore said in a phone interview with Military.com, noting the backlog in the military construction budget. "Why not take these outcomes that we've already seen work in so many other ways and enhance the capability to do it in these military base areas. So, this is going to provide better housing at lower costs for military families, and all the while, the private sector can continue to leverage its innovative development approach and take advantage of tax credits."

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Housing affordability and the scarcity of affordable housing close to military bases have been concerns among service members and lawmakers for years.

Congress and the Pentagon have sought to relieve the affordability concerns through increases to the Basic Allowance for Housing, or BAH, and updating the formula for the allowance to better match actual housing costs. Lawmakers have also proposed to make the BAH cover 100% of housing costs instead of the current rate of 95%.

But the concerns persist. The most recent Military Family Life Survey from nonprofit Blue Star Families showed that BAH and off-base housing was the fourth-highest concern for active-duty spouses surveyed and the third-highest concern for active-duty service members.

"As we look at readiness, as we look at retention and even recruitment, a lot of it is word of mouth," Strickland, who has long focused on military housing affordability, said in an interview. "And so we need to do what we can to make sure those who are serving and their families have an affordable place to live. And some of the markets that we represent, the cost of housing is high because the supply is constrained. And so any tool we can use to add to our housing stock, especially near the military bases, is a good thing for the community that serves in the military, but also the community at large."

Strickland's district includes Joint Base Lewis-McChord, where about 70% of military families live off-base. The base is situated in the Tacoma area, which is considered to be one of the most competitive housing markets in the country.

Meanwhile, in Moore's state of Utah, home prices have shot up 65% over the last five years, according to the Federal Housing Finance Agency's Quarterly House Price Index.

The LIHTC program was created in 1986 and is the "most important resource for creating affordable housing in the United States today," according to the Department of Housing and Urban Development.

Moore said he got the idea to apply the LIHTC program to housing near military bases from the mayor of a city within his district. Moore's district includes Hill Air Force Base, and the mayor who presented him the idea was Mark Shepherd of Clearfield, which borders the base.

"He and I actually ran against each other in my very first election," Moore said of Shepherd. "We have maintained a very positive, good relationship, enough where he can present an idea to me, and we ran with it. This is the way that politics and civil discourse is supposed to work."

In a statement provided by Moore's office, Shepherd expressed hope that the bill would lead to "high-quality rental units where the military members can have priority for the units."

"Having our military members who have volunteered to put their lives on the line to defend our nation live in sub-par housing, or struggle to afford food because all of their available income goes to housing, sends the wrong message to the military members and to the communities in which they live," Shepherd said in the statement.

Moore has received $133,701 in donations from individuals and groups associated with the real estate industry this election cycle, the second-largest industry that has donated to him behind insurance, according to campaign finance tracker Open Secrets. Strickland has received $62,912 in donations from the real estate industry, the fifth-largest category of industry donations.

Because the bill involves a tax credit, it is under the jurisdiction of the House Ways and Means Committee. Moore sits on the committee and said he has already had conversations with Chairman Jason Smith, R-Mo., and others on the panel about moving the bill forward in any large tax package the committee advances.

"We went through committee painstakingly making sure that, once we get this launched, this does have viability, instead of just a messaging bill," Moore said. "You have two options: You can either go spend a whole bunch more money to try to catch up on where we're at with military housing, or you can allow for the private sector and the national development world to engage. ... I hope to see this really make a positive impact on the dearth of housing that exists."

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