Katrina Housing Tax Relief Act of 2007

Floor Speech

KATRINA HOUSING TAX RELIEF ACT OF 2007

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Mr. MELANCON. Mr. Speaker, I thank the gentleman. I would like to thank the leadership for the bipartisan effort also. It has been a long 18, going on 19, months for the folks of Louisiana; and this is the kind of thing that they have needed for a long time.

I am here today to speak in support of the Katrina Housing Tax and, as Mr. Boustany pointed out, the Rita Housing Tax, also, which will extend important tax credits and waivers that are boosting rebuilding efforts along the gulf coast.

It is hard to exaggerate the devastation Hurricanes Katrina and Rita caused in south Louisiana. Over 1 million people had to flee their homes, and over 200,000 homes were damaged or completely destroyed. In St. Bernard Parish, a community to the east of New Orleans that I represent, it is reported that only five or six homes out of the 27,000 were inhabitable after the storm. It will take many years to repair the damage Katrina and Rita and the levee failures caused in just a few days.

The enormous extent of the damage and the unprecedented time and money it will take to recover are why we need to pass the Katrina-Rita Housing Relief Act. For south Louisiana to rebuild, we need to continue encouraging developers to build affordable housing, not just high-priced condos. There is a severe housing shortage in the region, and rental prices have increased by 39 percent and more since the storm. Home sale prices in suburban parishes have also skyrocketed. Average working people can't move home because they can't find affordable housing.

One of the most important features of this bill is the extension of the Gulf Opportunity Zone low-income housing tax credit until the end of 2010. Louisiana is offering these tax credits to developers who build affordable housing in the hurricane-affected communities, but current law requires that developers have the project built and occupied by the end of 2008.

In the post-storm world of south Louisiana, this is almost impossible. The Housing Financing Agency in New Orleans estimates that 65 percent of the affordable housing units under development, about 11,050 units, won't make the deadline to be available for rent by the deadline at the end of 2008. Add all the extenuating circumstances of post-Katrina Louisiana, mold remediation for flood-damaged rehabilitation projects, elevation of property, getting permits, going through the zoning requirements, all the things that take time, including needing water, sewer, and gas lines, there is no way that developers can finish.

Finally, as a fiscal conservative and a Blue Dog, I want to point out that this bill follows House PAYGO rules and will not increase the deficit. In fact, the offsets that are contained in the bill will cause an increase in revenue.

I thank the gentleman from Georgia, and I thank the bipartisan effort of the committee.

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