Democratic presidential candidate Sen. Cory Booker announced a major plan Wednesday to address the lack of affordable housing in the United States: He would provide a tax credit for renters who spend at least 30% of their income on rent. This program would affect 57 million Americans, 17 million of whom are children, according to researchers of a Columbia University study cited by Booker.
Before becoming a New Jersey senator, Booker, famously, was the mayor of Newark, and he still lives there. He has made his residence a recurring theme on the campaign trail. In a statement announcing the plan, he referred to his upbringing in Harrington Park, where his family was met with “racial discrimination” upon arriving in the predominately white Jersey town, and to “the tenants I represented against slumlords when I first moved to Newark.”
“Access to safe, affordable housing can be transformative in the trajectory of people’s lives,” Booker said. “Making sure all Americans have the right to good housing is very personal to me.”
At the center of Mr. Booker’s proposal is the renters’ tax credit, which would cover the difference between 30 percent of a person’s income and the fair-market rent in his or her neighborhood. There would not be an income cap limiting who could qualify, according to the campaign, which said the median participating family would receive $4,800 per year.
His campaign estimated the program would cost $134 billion annually. It did not propose specifically how to pay for the plan beyond rolling back changes to the estate tax made by President Trump, which it said would raise about $25 billion annually. The remainder, the campaign said, would come from restoring various taxes that were cut in the Republican-led tax overhaul from 2017.
Booker’s plan also calls for a tenant’s right to legal counsel in the event they face eviction and for funds from federal transportation programs and community development block grants to be set aside for communities that modify their zoning laws to facilitate the construction of affordable housing.
The United States is experiencing an affordable housing crisis. In 2016, Harvard researchers found that nearly half of renters were cost-burdened — that is, spending at least 30% of their income on rent. (For context, in 1960, only 20% of renters were cost-burdened.) According to advocacy group Home11, 11 million Americans spend more than half their income on rent.
And last year, the National Low Income Housing Coalition reported that a renter working 40 hours a week, earning minimum wage, cannot afford a two-bedroom apartment without being cost-burdened in literally any county in the country. “A full-time minimum wage earner would have to work approximately 122 hours per week for 52 weeks a year to afford a two-bedroom apartment, or 99 hours per week to afford a one-bedroom apartment at fair-market rent.”
Booker says the renters’ tax credit, packaged with his “baby bonds” (a $1,000 bonded savings account given to every child born in America, run through the Treasury Department, to which the federal government would contribute annually), is a means of closing the wealth gap and addressing poverty. He told NJ Advance Media — which noted that Jersey is “home to six of the 10 biggest cities with the greatest percentage of renters” — that “all of my life, my politics have been about standing up for those communities who too often have been looked down upon, left behind, left out.”