HARRISBURG, PA – March 18, 2015 – (RealEstateRama) — Legislation to expand the Housing Trust Fund statewide has been introduced in both the Pennsylvania House and Senate. Senators Elder Vogel (R-Beaver) and Shirley Kitchen (D-Philadelphia) are the prime co-sponsors of Senate Bill 566, introduced with 23 bipartisan co-sponsors. The bill was referred to the Urban Affairs and Housing Committee on February 25. Last week Representative Tom Killion (R-Delaware) introduced House Bill 792, supported by 40 bipartisan co-sponsors, and referred to the Urban Affairs Committee.
Under the proposed legislation, the state Housing Trust Fund – currently only available in 37 Marcellus Shale producing counties – would receive 40% of the growth in revenue from the Realty Transfer Tax to expand the program statewide, capped at $25 million per year. The expansion of the program has the potential to spur a $400 million economic impact, adding up to 3,000 jobs and an additional $20 million in state tax revenues while also increasing the supply of homes within reach of Pennsylvania’s most vulnerable citizens.
“Ever since our victory in establishing the Housing Trust Fund nearly five years ago, we have relentlessly pursued additional funding to expand this essential program to so many others throughout the Commonwealth in need,” said Liz Hersh, executive director of the Housing Alliance of Pennsylvania. “The tremendous growth in support from legislators on both sides of the aisle is proof that the model works. There are too many struggling families, disabled individuals, veterans and others to wait any longer.”
The Housing Trust Fund, officially called the Pennsylvania Housing Affordability and Rehabilitation Enhancement Fund (PHARE), was created in December 2010 and got its first revenue source in February 2012 from the Marcellus Shale Impact fee. It has since funneled $26 million into affordable homes in the Shale region with almost 2,900 households being helped through rental rehab, homeowner repairs, rental assistance, site preparation, new construction and a wide range of activities based on local needs.
The money to pay for the expansion would come without creating new fees or raising taxes. Instead, revenue would be drawn from future growth in the Realty Transfer Tax as the real estate market continues to rebound. Based on current growth, the Housing Alliance forecasts it would probably take until 2019 to reach that $25 million ceiling. The transfer tax equals 1% of the sale price of a property and the state expects the tax to bring in close to $450 million this year.
“We have the opportunity – really, the imperative – to make a much needed statewide impact on countless lives,” Hersh said. “Not to mention that the program can be capitalized without raising taxes or fees. It’s a win-win.”
The Senate Urban Affairs Committee last June unanimously voted to expand the program statewide. The House then introduced its version of the bill in August. The end of the legislative session in November delayed further action until now.
The Housing Alliance of Pennsylvania is a non-partisan, statewide public interest advocate working to help increase the supply of safe, affordable and accessible homes available to all Keystone State residents – especially those with low incomes, including veterans, elderly and disabled individuals. By serving as a central information hub for housing advocates, providers and the media and seeking ways to collaborate with local, state and federal policy makers, the Housing Alliance helps Pennsylvania’s most vulnerable residents find stable, secure homes and use it as the foundation of prosperity. For more information, visit www.HousingAlliancePA.org.
