Natural State News

Sen. Tom Cotton (R-Arkansas) warns that legislation that would give Black Americans $25,000 for a down payment on a home is wrong on multiple levels, and he is calling on journalists to acknowledge that.

"Giving Americans money based on their skin color is illegal, racist, and reporters should stop being afraid to say so," Cotton said in a May 26 Facebook post.

In what Politico called a "down payment aid to close racial wealth gap," House Financial Services Committee Chair Maxine Waters (D-California) has suggested a $10 billion proposal to provide Black would-be homebuyers up to $25,000 for a down payment. The move would be introduced as part of President Joe Biden's infrastructure plan.

Multiple news outlets have reported that Waters is pushing the program, intended to assist first-time homebuyers, called "Downpayment Toward Equity Act of 2021." A draft version of the legislation was passed around ahead of a committee hearing when lawmakers discussed multiple measures being considered for President Biden’s $2 trillion infrastructure package. Waters' proposal was only one of those measures.

The Waters' proposal for down payment assistance would be means-tested, based on income; limited to those who have not owned a home in three years; and to those whose parents don't own their home or, if they did, they lost it to foreclosure or a short sale, according to the various news outlet reports.

The program would hand out the money to states based on population, racial demographics and other factors. Politico reported that the draft legislation is worrying the mortgage industry because lenders would be required to target first-generation buyers, as well as socially and economically disadvantaged groups.

Cotton referred to the Politico news story in his Facebook post.

If the draft legislation makes it to Biden's desk and the president signs it, the down payment assistance could reach 5 million first-time, first-generation home buyers, the Urban Institute reported.