NLIHC President and CEO Sheila Crowley testified in support of the National Housing Trust Fund (NHTF) on May 25. The hearing of the House Financial Services Subcommittee on Capital Markets and Government Sponsored Enterprises (GSEs), “Transparency, Transition and Taxpayer Protection: More Steps to End the GSE Bailout,” also included testimony from Edward DeMarco, Acting Director of the Federal Housing Finance Agency; Anthony Sanders, Professor of Real Estate at George Mason University; and David John, Senior Research Fellow at the Heritage Foundation.
The hearing focused on a package of seven bills, soon to be introduced by Republican Members of the House Committee on Financial Services, that are intended to dismantle Fannie Mae and Freddie Mac (see Memo, 5/13). One of these bills, introduced by Representative Ed Royce (R-CA), would abolish the NHTF.
Ms. Crowley's testimony focused on the value of the NHTF as a solution to the persistent deficit of rental housing affordable and available to the lowest income people in the United States. Given the great need for the NHTF, Ms. Crowley requested that Mr. Royce withdraw his proposal.
In his opening statement, Mr. Royce said that the NHTF should be abolished in order to ensure that funds do not flow “to activist organizations who dabble in housing and rental assistance as well as dabble in political activism.” The NHTF statue prohibits the use of NHTF dollars for political activities, lobbying, counseling, outreach, and project administration. Mr. Royce did not stay to hear Ms. Crowley’s testimony.
Subcommittee Ranking Member Maxine Waters (D-CA) spoke out in support of the NHTF, describing it as critical to the approximately seven million people with worst case housing needs in the United States. HUD defines worst case needs households as very low income, and paying more than 50% of their incomes for rent or living in substandard housing, or both. Ms. Waters also expressed disagreement with characterization of the NHTF as a “slush fund,” given that the NHTF has never been capitalized, and thus no possibility of misuse.
Ms. Waters asked Subcommittee Chairman Scott Garrett (R-NJ) to insert a list of more than 7,200 organizations, from every congressional district, who support the National Housing Trust Fund Campaign, into the record. He concurred.
Representatives Andre Carson (D-IN), Earl Perlmutter (D-CO), and Al Green (D-TX) also spoke out in strong support of the NHTF, with Mr. Green engaging in a colloquy with Mr. Garrett about the importance of the NHTF for extremely low income (ELI) households. Mr. Garrett did not object to the need for the NHTF but said he was concerned about funding transparency, and asked whether it would be better for the NHTF to be funded out of the HUD budget.
The NHTF was established by statute to be funded by a dedicated source of revenue, not through the regular HUD appropriations process, so that it does not compete for funding with existing programs that serve ELI households. The initial source of funding for the NHTF was to be contributions from GSEs, but the statute authorizing the NHTF also allows the NHTF to be funded by other sources. The GSEs, Fannie Mae and Freddie Mac, were taken over by the Federal Housing Finance Administration in September 2008, and have never made a contribution to the NHTF.
An archived webcast of the hearing and all witness testimony is available at: http://financialservices.house.gov/Calendar/EventSingle.aspx?EventID=241959
NLIHC’s press release on Ms. Crowley’s testimony is available at: http://nlihc.org/detail/article.cfm?article_id=7911&id=48