WASHINGTON, D.C. – January 24, 2011 – (RealEstateRama) — In a January 21 letter to White House policy chiefs, the National Housing Trust Fund Campaign called on the Obama Administration to recommend funding for the National Housing Trust Fund (NHTF) in its upcoming report on the future of federal housing finance policy.
The letter recalls that Congress intended contributions from Fannie Mae and Freddie Mac to be the initial revenue sources for the NHTF when the housing fund was created in the Housing and Economic Recovery Act of 2008 and urges that this obligation be renewed and expanded in the upcoming reforms of the two government sponsored enterprises or their successors.
The letter, provided in full below, is signed by 33 organizations representing thousands of housing, civil rights, and human needs advocates across the United States.
Once funded, the NHTF will support the production, preservation, and operation of rental homes for the lowest income people in the United States. The NHTF is the first federal rental housing production program that is specifically targeted to extremely low income households since the Section 8 program was established in 1974.
A new analysis by the National Low Income Housing Coalition shows that the shortage of rental homes that are affordable and available for extremely low income households grew from 5.2 to 6 million between 2007 and 2009.
The Administration’s report is due no later than January 31, 2011.
The undersigned national organizations that are members of the National Housing Trust Fund Campaign are writing to urge that funding for the National Housing Trust Fund (NHTF) be one of the recommendations in the Administration’s upcoming report on the future of the federal housing finance policy. This report was required by the Dodd-Frank bill and is due no later than January 31, 2011.
As you know, the NHTF was established in the Housing and Economic Recovery Act of 2008 (HERA). It is to be administered by HUD, which is now finalizing the regulations that will govern the operation of the program.
HERA provided that the NHTF be capitalized in part with contributions from Fannie Mae and Freddie Mac. Unfortunately, it was soon after HERA was enacted that Fannie and Freddie’s financial problems were identified and they were placed in conservatorship by their regulator, the Federal Housing Finance Agency (FHFA). FHFA suspended the contributions to the NHTF and that status continues today.
It is clear that substantial changes are in order for how the federal government supports and regulates the U.S. housing market. It is equally clear that Congress intended for the federal government to require the companies that make substantial profits in the housing market with the backing of the federal government assist in addressing unmet housing needs that are beyond what can be provided by the housing market.
Housing, like health care, is so essential to human well-being that any profit seeking enterprise in housing must be grounded by social responsibility that is assured by government regulation. Therefore, all segments of the housing finance sector should contribute to solving the most serious housing problems. Whatever form Fannie and Freddie take in the future, the obligation to contribute to the National Housing Trust Fund must be renewed and expanded.
Just as important, all federally regulated financial institutions, which benefit from the federal government bearing some of the risk of their transactions, have a similar obligation and should be required to make similar contributions. There should be revenue-generating requirements on all financial institutions, including, but not limited to, the next generation of secondary market entities. The federal government provides private financial institutions with low cost funds through a variety of sources. The most important of these are lenders’ ability to borrow from the Federal Reserve and the Federal Home Loan Banks and to acquire low cost deposits based on federal deposit insurance. Congress could also levy a fee on the securitization of mortgages by any capital markets participant and direct these revenues to the National Housing Trust Fund.
The need for the NHTF is more urgent than ever before. Its primary purpose is to produce and preserve rental homes that are affordable to extremely low income (ELI) households, those with incomes at or below 30% of the area median or the federal poverty level, whichever is higher. This is the only income group for whom there is a nationwide shortage of affordable homes.
The National Low Income Housing Coalition’s most recent analysis of data from the American Housing Survey shows that the shortage of rental homes that ELI families can afford grew substantially between 2007 and 2009. The absolute shortage increased from 2.1 million units to 3.4 million units. The number of rental units affordable to ELI families decreased by 600,000, while the population needing these homes increased by 700,000. Because many rental homes that ELI households can afford are rented by higher income people, the shortage for ELI households is actually much worse. The shortage of rental homes both affordable and available for ELI households grew from 5.2 to 6 million in those two years.
On behalf of the thousands of state and local organizations in every single Congressional District that support the NHTF, we urge you to do everything you can to make sure that we seize this opportunity to at long last direct new resources to what remains the country’s most serious housing problem.
Thank you for your steadfast support of low income Americans.
Center for Community Change
Coalition on Human Needs
Community Action PartnershipConsortium for Citizens with Disabilities
Council of Large Public Housing Agencies
Enterprise Community Partners
Housing Assistance Council
Housing Partnership Network
LeadingAge (formerly AAHSA)
NCB Capital Impact
National AIDS Housing Coalition
National Association of Housing and Redevelopment Officials
National Coalition for Asian Pacific American Community Development
National Coalition for the Homeless
National Community Reinvestment Coalition
National Council of La Raza
National Fair Housing Alliance
National Health Care for the Homeless Council
National Housing Conference
National Housing Law Project
National Housing Trust
National Law Center on Homelessness and Poverty
National Low Income Housing Coalition
National Network for Youth
NETWORK, A National Catholic Social Justice Lobby
Poverty & Race Research Action Council
Stewards for Affordable Housing for the Future
Technical Assistance Collaborative
The United Methodist Church General Board of Church and Society
Volunteers of America
Established in 1974 by Cushing N. Dolbeare, the National Low Income Housing Coalition is a membership organization dedicated solely to achieving socially just public policy that assures people with the lowest incomes in the United States have affordable and decent homes.
National Low Income Housing Coalition (NLIHC)
727 15th Street NW, 6th Floor, Washington, D.C. 20005
202/662-1530; Fax 202/393-1973; " title="mailto:">; www.nlihc.org
©2011 National Low Income Housing Coalition.
Amy Clark, (202) 662-1530 x 227