US House Approves National Housing Trust Fund
This article contains additional reporting by News Editor, Matthew Cardinale
(APN) ATLANTA — The US House approved legislation Wednesday, October 11, 2007, with broad bipartisan support that is considered a dramatic victory for the homeless and low-income populations of the United States. The Fund would be the largest expansion in federal housing programs in decades.
Lawmakers passed HR 2895 by a vote of 264-148, a bill that creates a National Affordable Housing Trust Fund for producing, preserving, and rehabilitating 1.5 million affordable homes in 10 years. The Fund would not pay for rental vouchers. The moneys in the Trust Fund would only be able to be used on affordable housing, similar to the way Social Security Trust Fund moneys are limited to Social Security.
All of Georgia’s Democratic delegates voted yea on the bill. All of Georgia’s Republican delegates voted nay.
The National Low-Income Housing Coalition and other organizations including the National Coalition for the Homeless have been lobbying for this bill since 2001. In previous years, the Republican-led majority would not allow the bill to come up for a vote although it has consistently gained many cosponsors.
“The National Affordable Housing Trust Fund addresses the affordable housing crisis as it affects every level of society. Right now, housing costs are outstripping wages for more households than ever before, and working is simply no longer a guarantee of being able to afford housing,” US Rep. Maxine Waters (D-CA), Chairwoman of the Financial Services Subcommittee on Housing and Community Opportunity, said in a press release obtained by Atlanta Progressive News.
“It has been seventeen years since the federal government last enacted a major affordable housing production program, and I am pleased that this legislation will tackle the full range of housing crises, providing relief to overburdened renters and homeowners while targeting funds where the need is greatest.”
“The growing shortage of affordable housing is one of the most serious social and economic problems facing our country. Given our severely constrained fiscal realities, we are today doing the best we can to address this — creating a low income housing trust fund that will be paid for in ways that do not draw from federal tax revenues,” said US Rep. Barney Frank (D-MA), Chairman of the House Committee on Financial Services.
The act will set aside 75 percent of its federal funding to provide for households considered to be extremely low income, meaning households earning less than 30 percent of the area’s median income.
Funding for the Trust Fund comes from government-sponsored enterprises Fannie Mae and Freddie Mac in addition to the expansion of the Federal Housing Administration’s home equity conversion mortgage product. The US House has already approved two funding sources for the Trust Fund separately this year.
HR 1427, the Federal Housing Reform Act of 2007, which passed May 22, 2007, included a provision for funding the Trust Fund from government-chartered enterprises Fannie Mae and Freddie Mac.
Fannie Mae and Freddie Mac would contribute 12 thousandths of 1 percent (1.2 basis points) of their total mortgage portfolio to the fund, a sum the White House said places an undue burden on those companies, even though the companies have not publicly expressed opposition to this requirement, according to The Washington Post newspaper.
HR 1852, the Expanding American Homeownership Act of 2007, which passed September 14, 2007, included a provision funding the Trust Fund from the Federal Housing Administration (FHA).
The Congressional Budget Office estimates that the Trust Fund has an estimated value of anywhere between $800 million and $1 billion annually.
The US Department of Housing and Urban Development (HUD) would make direct grants or allocate money to state or localities through formulas determined by the Secretary of HUD.
There are only 6.2 million homes renting at prices affordable to the 9 million extremely low-income renter households nationwide. There is not one congressional district that has enough affordable, available rental housing to accommodate this segment of America.
Advocates of the Trust Fund argue making HR 2895 law could go a long way to remedy this problem.
The US Senate is expected to consider a companion bill before the end of the year, Steve Berg of the National Alliance to End Homelessness, told Atlanta Progressive News.
“We have a lot of confidence the Senate will move on it soon and have a lot of support,” Berg said.
Even if the Senate passes the bill, it will have a tough time becoming law due to the White House’s veto threat.
“The [Bush] administration strongly opposes the establishment of an affordable housing trust fund financed by diverting Federal Housing Administration (FHA) receipts and housing-related Government Sponsored Enterprises (GSEs) revenues,” according to a statement from the Office of Management and Budget.
“Accordingly, if HR 2895 were presented to the president, his senior advisors would recommend that he veto the bill.”
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