Washington, DC - The House Financial Services Committee will vote next week on a bill – introduced by Congressman French Hill (R-AR) – that includes a provision to hold hostage the national Housing Trust Fund, a program that helps America’s lowest income seniors, people with disabilities, families with children, and veterans afford to keep a roof over their heads, until Congress passes legislation to reform Fannie Mae and Freddie Mac. While NLIHC looks forward to working with Congress to enact bipartisan housing finance reform legislation that ensures housing access and affordability for American families, it strongly opposes using critically needed housing resources for struggling families as a bargaining chip.
The national Housing Trust Fund is the first federal housing resource in a generation exclusively targeted to help build and preserve rental homes affordable to people with the lowest incomes, and it is specifically designed to address the housing needs of people most severely impacted by the U.S. rental housing crisis.
The Housing Trust Fund is funded through a slight fee (0.42%) on Fannie Mae and Freddie Mac activity. If enacted, the bill would stop funding for the Housing Trust Fund until Wall Street investors in Fannie Mae and Freddie Mac receive dividend payments. This can only occur when Congress enacts legislation to reform Fannie Mae and Freddie Mac, which have been in government conservatorship for nearly a decade.
In 2017, $220 million in Housing Trust Fund dollars were allocated to states. Because the program is administered as a block grant, each state has the flexibility to decide how to best use these resources to address its most pressing housing needs. Most states have chosen to use their Housing Trust Fund investments to build and preserve affordable rental homes for extremely low income veterans, seniors, people with disabilities or special needs, and people experiencing homelessness.
Nationally, there is a shortage of 7.4 million rental homes affordable and available to families with extremely low incomes. For every 100 of the lowest income households, there are just 35 affordable homes available to them. Due to chronic underfunding of critical affordable rental housing programs, just one in four low income households in need receives any housing assistance. The rest either live on the cusp of homelessness – most (71%) paying more than half of their limited incomes on rent – or they are one of the hundreds of thousands of people who have no homes at all. These families are forced to make impossible trade-offs between paying rent and buying groceries, seeing a doctor, paying for medications, or saving for a rainy day.
NLIHC President and CEO Diane Yentel states, “We agree that bipartisan housing finance reform is long overdue, but holding the Housing Trust Fund hostage, at a time when our country is experiencing a severe shortage of affordable rental housing for people with the greatest needs, is unnecessary, cruel and counter-productive.”
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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.