National Affordable Housing Trust Fund

November 5 , 2007

On Wednesday, October 10, the House of Representatives passed H.R. 2895, the National Affordable Housing Trust Fund Act of 2007, by a vote of 264-148. Work now begins to have the bill introduced in the Senate.

The National Affordable Housing Trust Fund Act of 2007 was first introduced in June by Rep. Barney Frank (D-MA). The Act would allow for a housing trust fund independent of appropriations, drawing on money from Government Sponsored Enterprises (Fannie Mae and Freddie Mac) and expanding the FHA's home equity conversion mortgage product. This independence is essential due to the budget deficits; however, it is still critical for the federal government to provide adequate and affordable housing to extremely low-income homes, something that Rep. Jim Ramstad (R-MN) called, "…a basic human right." Data show that there are currently shortages in forty-two of the fifty states, as well as the District of Columbia. Statistics gathered from the U.S. Department of Housing and Urban Development indicate that the situation is worsening; the need for affordable rental units for extremely low-income households has more than doubled between the years 2003 and 2005.

The Trust Fund aims to make monetary resources available to developers who are willing to operate low-income housing for extremely low-income families. The federal government cannot affect local land-use ordinances, but it can provide incentives and rewards to those communities that choose to build and maintain affordable low-income housing. Rewards are given for projects located near transportation centers and for those that use "green" housing materials and designs. The federal government will reward state and local governments that seek to resolve their housing problems by matching contributions at a higher rate than federal programs.

We desperately need federal housing programs geared toward the extremely low-income sector. Most of the resources of the Housing Trust Fund will be used to develop affordable rental housing. As renters, the low-income families will be experiencing a period of stability that will allow them to develop positive credit ratings and save money for a down payment on a house.

The National Affordable Housing Trust Fund Act of 2007 will also benefit all communities, from rural to urban. In order to thrive, cities must provide housing to those persons who help to develop and improve their infrastructure. In most cases, these persons fall into the low-income to extremely low-income bracket. Rural areas would benefit as well. Rural areas generally lack sufficient charitable and other financial resources to assist persons in periods of unemployment or who work for lower wages. H.R.2895 would allocate funds to help these individuals and families.

More information about the trust fund can be found in the September-October 2007 issue of the Connection.

NETWORK Values

NETWORK believes that access to safe, affordable housing is a basic right. As the U.S. Conference of Catholic Bishops has reminded us, “Decent housing for all our people is a moral imperative.” (The Right to a Decent Home, 1975)