June 3, 2011 – (RealEstateRama) — At a time when there are 10 million extremely low income renter households in the United States and only 6.5 million homes renting at prices those households can afford, Representative Ed Royce (R-CA) has introduced a bill that would eliminate the only housing program designed to fill this gap. On May 25, NLIHC President Sheila Crowley testified at a hearing on this bill, which would abolish the National Housing Trust Fund.
The hearing, titled “Transparency, Transition and Taxpayer Protection: More Steps to End the GSE Bailout,” was held in the Subcommittee on Capital Markets and Government Sponsored Enterprises of the House Financial Services Committee by Chairman Scott Garrett (R-NJ).
Ms. Crowley’s testimony served to clarify for the committee the purpose and value of the National Housing Trust Fund. “The people who conceived of and have advocated for the National Housing Trust Fund see its purpose is to end this shortage” of affordable rental homes for the lowest income Americans, said Ms. Crowley. “We think this is a proper role for government…. The market will not fill this gap.”
The National Housing Trust Fund was created in 2008 as part of the Housing and Economic Recovery Act (HERA). It is a dedicated fund intended to provide revenue to build, preserve, and rehabilitate homes for people with the lowest incomes. The National Housing Trust Fund is to be funded with dedicated sources of revenue. The initial sources were contributions from the Government Sponsored Enterprises (GSEs), Freddie Mac and Fannie Mae. Fannie and Freddie were taken into conservatorship shortly after the passage of HERA. No contributions have been made to the National Housing Trust Fund.While other housing programs exist, none have adequate funding or serve all households in need. HUD rental assistance programs serve only one quarter of eligible households. All HUD programs are part of domestic discretionary spending, and as such are subject to deep cuts or total elimination in each annual appropriations process. The National Housing Trust Fund is designed to serve the exact population that is not currently served by other HUD housing programs, and will have a dedicated, steady revenue source.
In her testimony, Ms. Crowley also discussed potential funding sources for the National Housing Trust Fund. These sources include:
- A dedicated source of funding designed into the entity that will replace Fannie Mae and Freddie Mac in the secondary mortgage market.
- Profits made on the sale of “warrants” created in the Emergency Economic Stability Act of 2008, as proposed in H.R. 1477 by Representative Elijah Cummings.
- Savings realized from reform of the mortgage interest deduction.
At the hearing, Ranking Member Maxine Waters (D-CA) asked to have entered into the record the list of the more than 7,000 local, state and national organizations that have signed on in support of the National Housing Trust Fund.
Sheila Crowley’s complete testimony is available at http://financialservices.house.gov/uploadedfiles/052511crowley.pdf
More information on the hearing is available at: http://financialservices.house.gov/Calendar/EventSingle.aspx?EventID=241959
Established in 1974 by Cushing N. Dolbeare, the National Low Income Housing Coalition is dedicated solely to achieving socially just public policy that assures people with the lowest incomes in the United States have affordable and decent homes.
Amy Clark; 202-662-1530 x227;