NLIHC sent a letter to Treasury Secretary Steve Mnuchin and Federal Housing Finance Agency (FHFA) Director Mark Calabria on September 24 urging the agencies to continue Fannie Mae and Freddie Mac payments to the national Housing Trust Fund (HTF) as they move forward with efforts to recapitalize Fannie and Freddie (see Memo 9/9). NLIHC joined twelve other organizations in a second letter to Secretary Mnuchin and Director Calabria on September 25 that stressed the importance of continued funding to the HTF and the Capital Magnet Fund (CMF).
The HTF, created by Congress in 2008 to address the affordable housing needs of America’s lowest-income households, and the CMF, which provides competitive financing for affordable housing and community development projects, are funded through a small fee on the housing finance activities carried out by Freddie Mac and Fannie Mae, overseen by the FHFA.
The FHFA director has statutory authority to halt payments to the HTF and CMF under certain, very limited, circumstances; former FHFA Director Ed DeMarco did so when Fannie and Freddie were put under government conservatorship after the housing crash of 2008. Halting payments to the HTF would prevent the creation and preservation of affordable, accessible homes for the lowest-income families. NLIHC’s interim analysis found that states used the $174 million in the 2016 HTF awards to fund 138 projects with more than 1,500 homes serving people formerly experiencing homeless, seniors, people with disabilities, abuse victims, and other vulnerable people.
In the letters, NLIHC and our partners urge FHFA and Department of Treasury to continue payments to the HTF and the CMF. The letters note that the required contributions are not enough to cause a substantial financial burden to Fannie Mae or Freddie Mac under any capital restoration plan that may be undertaken. Although these funds are a tiny fraction of two housing finance entities’ overall revenues, they are extremely important for addressing the nation’s ongoing affordable housing crisis.
Read the letter from NLIHC at: https://tinyurl.com/y5fd2pav
Read the letter from NLIHC and partners at: https://tinyurl.com/y4tfrw8z