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Biden Announces New Fund For Climate Upgrades To Help Low-Income Housing

The funding provided by the Inflation Reduction Act (IRA) will be distributed by the Department of Housing and Urban Development.

May 11, 2023

The Department of Housing and Urban Administration is entrusted with the responsibility of providing low-income housing assistance via funds from the Inflation Reduction Act.

The Biden administration took a significant step for low-income Americans to enable them to enjoy the benefits of Democrats’ landmark climate law. The White House wants to invest in poor and minority communities because it feels that they have borne the brunt of pollution.

The Department of Housing and Urban Development revealed the availability of nearly $1 Million for low-income multifamily housing so that they can become water-efficient, energy efficient, and resilient to climate disasters. The funding originates from the Inflation Reduction Act, which is a climate law that was signed by Biden last summer.

The climate law has made available thousands of dollars for households to switch from fossil fuel-powered applications to cleaner versions such as $7500 for new electric vehicles and $2000 for a new electric heat pump. There are many low-income Americans who might not be aware of these subsidies or they lack the time or resources to claim them.

Consequently, the law provided HUD with $837.5 Million in funding and $4 Billion as a loan to implement the Green and Resilient Retrofit Program and enable the owners to install rooftop solar panels, heat pumps, and other climate-friendly upgrades.

HUD’s secretary, Marcia L. Fudge said, “ Our mission is to make sure that low-income people are participants in what we believe is going to be one of the biggest climate focused projects in this country”.

HUD also helps property owners by paying a specific portion of the tenant’s rent. As per the new program, the property owners can apply for grants or loans to cover the additional cost to improve energy efficiency, reduce water use, or increase climate resilience to weather disasters. This can help the tenants in the form of lower utility bills.

According to the HUD’s officials, on an average, hundreds of properties are about to receive new government funding, covering thousands of households. There was an official who spoke on the condition of anonymity because they were not allowed to speak publicly about the same. The same official also confessed that even $837.5 money will fall short to reach 23,495 properties with multi-family housing units.

More at risk from climate change

The low-income communities are the ones that get hit the most by the frequency of climate change and the severity of natural disasters. Back in 2017, when Hurricane Harvey inundated southern Texas, poor households experienced greater property damage as they were mostly concentrated in the flood-prone region. Many low-income residents were found to be living in moldy, water-ravaged homes because they could only afford a few repairs.

According to the Federal Emergency Management Agency, 80 percent of affected households had no flood insurance. The new Federal Spending will strengthen homes before the next disaster strikes.

The new program will also include better home insulation to prevent heat from escaping in the winter and cool air from escaping in the summer. Due to this, the families are less likely to run air conditioners or heating appliances which in turn will aid in saving money on utility bills.

Biden in his early presidency took a vow that he will place environmental justice at the center of his plans as this will help in combating climate change and shift the nation towards clean energy. He has also asked the Federal Government to spend at least 40% of its sustainability investments on disadvantaged communities.

The House Republicans repeal the clean energy tax credits in the Inflation Reduction Act which the new program recognizes as reckless government spending. Kevin McCarthy, the house speaker, asks for ending the green giveaways that distort the market and waste taxpayers’ money without specifically targeting the Green and resilient retrofit program. 

White House officials responded by saying that the programs in the climate law have benefitted the residents of red and blue states. It is the same point Fudge emphasized while defending the new spending.

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The content provided in this article draws inspiration and includes quotes from various reputable sources, including news articles, government data, and interviews. Affordable Housing 411 strives to ensure accuracy and credibility, but the information presented may be based on some external sources. We encourage readers to refer to the referenced materials for more in-depth insights and verification.

Joselow Maxine. “Biden announces new fund to help low-income housing get climate upgrades”. WashingtonPost, May 11, 2023, HUD announces nearly $1B to make low-income homes climate-friendly – The Washington Post

Last Updated: September 20, 2021