PORTLAND — Congress approved the biggest expansion of the Low-Income Housing Tax Credit in decades as part of a recent spending package. The program provides up to $15 billion annually in federal tax credits to help developers build rental housing.

Under the program, developers typically must set rents affordable to households earning 60% of area median income. In Portland, that equals about $75,000 annually for a family of four. Rent for a one-bedroom apartment built with these tax credits is about $1,400 per month—nearly half the income of someone earning $35,000 annually at the local minimum wage.

“The evidence is telling us this program is lacking its reason to exist,” said Kirk McClure, an emeritus professor of urban planning at the University of Kansas. “That’s a mistake. It won’t alleviate homelessness or the housing shortage for people at the lowest incomes. It will just create more buildings that compete with the market and with one another for the same pool of renters.”

Studies have concluded that the tax credit supports nine out of every 10 subsidized housing units built in the U.S. but is expensive and ineffective at reaching the poorest households. Researchers have found it does not subsidize housing deeply enough and instead produces units in income brackets that already have a surplus. Between 1991 and 2024, a dozen studies concluded rental vouchers would benefit more people, with estimates as high as twice the impact per dollar spent.

Former HUD Secretary Ben Carson told the House Committee on Oversight and Government Reform in 2025 that “the program leverages housing market forces, entrepreneurial innovation and private accountability to increase housing supply.” Senator Ron Wyden of Oregon defended the credit in a written statement, saying, “There isn’t any silver bullet to the housing crisis in Oregon and around the country, but the low-income housing tax credit has been the most successful federal housing construction program on the books for decades and is the only housing program Republicans haven’t tried to gut.”

Nearly 2,000 subsidized housing units in Portland sat vacant at the time of reporting, according to The Oregonian and Willamette Week. On any given night, thousands of people sleep on the streets in Portland, seeking shelter in tents, bushes, and overpasses.