Housing Policy Innovation to Integrate Environmental Sustainability with Economic Development

Abstract

In the year 2017, about 89% of the total energy consumed in the US was produced using non-renewable energy sources and about 44% of tenant households were cost burdened. There is currently limited research on holistic approaches to housing policy that integrate housing affordability and environmental considerations. The objective of the current study is to utilize data and empirical analyses to explain green building policy content, adoption, and determinants in the context of the Low-Income Housing Tax Credit (LIHTC) program. We employ 2010–2016 data to test a conceptual model of state innovative capacity and explore the magnitude of associations between state characteristics and the incorporation of green building incentives into the LIHTC program in 50 US states. With a clear focus on savings from increased energy-efficiency, states increasingly adopted green building incentives between 2006–2010 but lost the initial momentum and started to fluctuate since 2010. The magnitude of governments’ financial resources, a holistic approach to green building, and citizens’ liberal ideology are among the strongest correlates of adoption controlling for income and population. To shift toward a sustainable future, policymakers should take a holistic, steady, and evolutionary approach to green building with an emphasis on simultaneous diversification, decentralization, and decarbonization of energy generation and seek complementary policies that raise the cost of carbon-intensive technologies in affordable housing. To facilitate the integration of green building with affordable housing policy, researchers should explore innovations in the policy process and measure the effectiveness of green building policies.