Next Tuesday, the Senate Banking, Housing, and Urban Affairs Committee will consider housing finance reform legislation that has the potential to benefit millions of extremely low income Americans who are at the greatest risk of being or becoming homeless. The draft Housing Finance Reform and Taxpayer Protection Act of 2014, commonly referred to as the “Johnson-Crapo” bill, would provide an estimated $3.75 billion for the National Housing Trust Fund each year. NLIHC urges the Committee to preserve the funding provided for the National Housing Trust Fund as the bill moves forward.
Draft bill language was released on March 16 by Senate Committee on Banking, Housing, and Urban Affairs Chair Tim Johnson (D-SD) and Ranking Member Mike Crapo (R-ID). The National Low Income Housing Coalition (NLIHC) and hundreds of national and state organizations strongly support the treatment of the National Housing Trust Fund in the Johnson-Crapo bill. Senators should oppose any amendment that would weaken resources going to the National Housing Trust Fund.
The Johnson-Crapo bill would provide for a 10 basis point fee on all transactions that go through the new Federal Mortgage Insurance Corporation (FMIC), estimated to generate $5 billion a year. The National Housing Trust Fund would receive 75% of these funds.
Once funded, the National Housing Trust Fund will build, preserve, rehabilitate, and operate rental housing affordable to extremely low income families. Extremely low income is 30% of the area median or less. There is a nationwide shortage of seven million rental homes that are affordable and available to households in this income group.
NLIHC supports changes to the bill to assure that underserved communities have access to credit, and to assure that existing Fair Housing and anti-discrimination laws are preserved in the bill. However, it is critical that the Committee retain the favorable treatment of the National Housing Trust Fund when proceeding with the bill’s markup next week.
This is a crucial moment for the National Housing Trust Fund, and for the millions extremely low income Americans, including seniors, veterans, and people with disabilities, who must spend half or more of their income on housing. Such high cost burdens make them at high risk of housing insecurity and homelessness. The Johnson-Crapo bill offers a landmark opportunity to invest in the affordable rental housing needed to end homelessness in the United States.
Dr. Crowley is available for further comment.