Fair Housing in the Garden State
Description
The Low-Income Housing Tax Credit (LIHTC) is the largest rental housing production program in U.S. history, but it operates outside of the U.S. Department of Housing and Urban Development. The IRS, which oversees the state agencies implementing the LIHTC program, does not provide explicit guidelines concerning segregation and poverty concentration. I find that the New Jersey Housing Mortgage Finance Agency which administers the program in New Jersey considers fair housing in ways that somewhat compensate for the lacking federal oversight, in part due to the Mount Laurel Doctrine, New Jersey’s statewide mandate against exclusionary zoning. I hypothesize that longstanding community opposition to economic integration voiced by suburban and rural municipalities in the state, may hamper desegregation and poverty deconcentration through the LIHTC. By examining project siting areas, I find that the New Jersey LIHTC does not reverse historical patterns of suburban and rural municipalities embracing affordable housing for seniors while rejecting affordable housing for families. I conduct a regression analysis to investigate the association between LIHTC housing and residential segregation and poverty concentration over time, controlling for neighborhood demographic, housing, and income characteristics. I conclude that despite the disproportionate siting of family LIHTC housing in high minority and high poverty areas, the LIHTC does not exacerbate segregation and poverty concentrationin New Jersey and may instead have contributed to declines in both outcomes.