The Build Back Better Act is a sweeping package of investments to support underserved people and communities. LISC’s Matt Josephs takes a closer look at this historic opportunity for Congress to break down systemic barriers for people of color, while at the same time fueling an equitable economic recovery from the pandemic.
Since the President’s 2021 State of the Union address, the administration has been working with Congress to pass a once-in-a-generation domestic investment bill modeled on the president’s American Jobs Plan and American Families Plan, which call for sizeable investments in affordable housing, child care, education, safety and justice, workforce and economic development programs, and income supports. It is clear that direct federal investments are required to strengthen the economic resilience of communities and households alike—especially given that COVID-19 has exacerbated longstanding inequities based on race, class and zip code.
LISC calls on Congress to advance this social spending package in order to address systemic disparities, foster an inclusive economic recovery and expand pathways to shared prosperity.
We know from experience that inclusive economic growth demands comprehensive and integrated supports; it’s one of the reasons LISC’s 2021-2022 Policy Proposals document spans policies and programs encompassing 17 different federal agencies. The Build Back Better Act similarly recognizes that our largest national challenges can only be solved by tackling inequities from multiple fronts. This requires substantial investments that empower individuals, government agencies, and nonprofit organizations to address poverty, build wealth, and comprehensively increase financial stability in both urban and rural communities.
Housing
Access to safe, decent, and affordable rental and homeownership housing is essential for the health and economic well-being of families. The pandemic intensified and laid bare longstanding housing instability issues, and as a result, Congress is rightly considering a significant expansion in housing investments.
Many of LISC’s top homeownership priorities are included in the current legislation, including a new downpayment assistance program for first-time homebuyers; homeowner rehabilitation resources; and passage of the Neighborhood Homes Investment Act, which would spur development and revitalization of homes in distressed communities. These measures would help low-income families purchase a home or improve their existing home, furthering housing stability while lessening racial gaps in homeownership rates and wealth.
There is not a single state, county, or metropolitan area in the U.S. where a minimum-wage worker can afford a modest two-bedroom rental unit without spending more than 30 percent of their income on rent.
We also need to significantly increase our federal investments in affordable rental housing. There is not a single state, county, or metropolitan area in the U.S. where a minimum-wage worker can afford a modest two-bedroom rental unit without spending more than 30 percent of their income on rent. High housing costs burden families and strain their ability to afford other essentials such as food, health care, child care, and transportation – keeping people trapped in poverty and leading to an increased risk of eviction and homelessness.
The spending package includes a significant expansion of rental assistance, both tenant-based and project-based, to make housing more affordable for the poorest families in our country. There is also an historic commitment to additional housing production, including an expansion of the Low Income Housing Tax Credit that could bring over 1.3 million new housing units online over the next 10 years; increased funding for critical gap-filling programs like HOME and the National Housing Trust Fund at HUD; and authorization of a new production program called the Housing Investment Fund that will be housed at the Treasury Department. Taken together, these would be the largest expansion of rental housing resources since the advent of these programs.
Child Care and Early Learning
It’s no secret that child care is expensive. Due to a historically underfunded and fragile business model, most child care providers must have high enrollment and low costs in order to break even or make a profit, and most families struggle to cover the cost of care. At the height of the pandemic, enrollment plummeted, causing some providers to close their doors. The sector has still not rebounded. In fact, recent research indicates that more than 8 million children under the age of 5 have the potential need for child care. This means that young children do not have access to essential developmental experiences and working families do not have access to care.
The Build Back Better agenda seeks to move toward a system of universal child care and expanded pre-K. It finally acknowledges the inextricable link between the quality of child care facilities and the quality of child care services—both directly connecting to availability. The legislation takes a necessary and long-overdue step to establish a dedicated funding stream for child care facilities, with $15 billion to address major health and safety concerns and support acquisition, construction and renovation and another $15 million for desperately needed intermediary technical assistance and support to providers.
Community Safety and Justice
LISC has long maintained that safety and justice are fundamental to the health and vitality of communities. Given the impact of the pandemic, spikes in violent crime and concerns about equitable policing, it is critical that the nation invest in community-based programs that keep young people--particularly young people of color—from falling into the criminal justice system and that engage local residents in constructive partnerships with law enforcement.
We are pleased to see that the Build Back Better legislation addresses this complex array of safety issues with $5 billion for violence and trauma intervention programs via the Department of Justice (DOJ) and the Centers for Disease Control (CDC). It includes $2.5 billion in DOJ grants for evidence-informed intervention strategies and $2.5 billion in CDC grants for outreach and conflict mediation; hospital-based violence intervention; violence interruption; and services for those at risk for experiencing violence.
Small Business Support and Workforce Development
An inclusive economic recovery requires equitable access to capital and technical assistance for small businesses and robust investments in the American workforce. Yet, for too long, critical federal programs have been undervalued and underfunded. That reality has contributed to a pervasive capital gap for minority-led enterprises and helped fuel the pandemic’s disproportionate impact on Black and Brown communities. It continues to limit the growth of many businesses in low- and moderate-income areas, and those owned by veterans, women, and entrepreneurs of color as well.
The reconciliation bill offers an opportunity to move beyond short-term assistance for owners and workers and toward long-term, catalytic investments that create wealth and promote economic mobility.
The reconciliation bill offers an opportunity to move beyond short-term assistance for owners and workers and toward long-term, catalytic investments that create wealth and promote economic mobility. It includes significant investments for the Small Business Administration, Economic Development Administration, and Minority Business Development Agency that would help level the playing field.
For example, the legislation would provide $3.1 billion to significantly expand the Minority Business Development Agency’s support for rural and urban businesses. It strengthens the agency’s capacity to partner with nonprofit organizations that provide business counseling and capital access, and it extends the reach of its business centers.
Investments in workforce development are likewise critical. Other provisions in the Build Back Better legislation would increase access to high-quality education, skill-building, and job-readiness programs so people are better prepared to succeed in our 21st century economy. The comprehensive proposals would expand support for Registered Apprenticeships and other paid job training programs, fund a new Civilian Climate Corps at AmeriCorps, and strengthen employer partnerships to place more workers into living wage jobs.
Congress can and must meet this historic moment by investing in an equitable recovery from the pandemic. Lawmakers can fuel continued support for families and communities impacted by COVID-19, while providing increased federal resources to drive new opportunities. We hope you will join us and our partners in urging Congress to pass the Build Back Better legislation.
Matt Josephs, Senior Vice President, LISC Policy
Matt manages the team that is responsible for developing LISC’s federal policy agenda; communicating this agenda to LISC employees, board members, funders and other stakeholders; and pursuing this agenda through engagement with members of Congress and other federal officials.
@LISC_policy