WASHINGTON, DC - Congress' massive housing bill has passed the House, and will be approved by the Senate before soon becoming law. While its primary focus is foreclosures, the bill also creates a National Housing Trust Fund (NHTF), a guaranteed annual funding source for the construction of affordable housing.
Back in 1999, a small group of housing advocates pushed for the NHTF, and made great strides in 2000. They beleive that if the Supreme Court allowed Florida to count its votes and Al Gore to win the White House, the nation would likely have seen the creation of a NHTF no later than 2002. But history took a different course. It is a tribute to the tenacity of the National Low-Income Housing Coalition (NLIHC) that the dream of an Affordable Housing Trust Fund never died, and, incredibly, that it was enacted during the Bush presidency.
Activists spend so much time fighting for local and state responses to the nation's affordable housing and homelessness crisis, that typically ignored is the federal government's responsibility for the problem. Richard Nixon stopped new public housing in the 1970's, and Ronald Reagan decimated the federal housing budget in the 1980's (killing subsidized housing just as urban gentrification made such assistance imperative to stop homelessness.
Bill Clinton had eight years to make a dent in the housing crisis, and did nothing until the tail end of his tenure, when Andrew Cuomo became HUD Secretary and forced the Clinton Administration to increase housing assistance. George W. Bush quickly reversed Cuomo's progress, and has left the administration of the nation's federal housing programs in acutely substandard condition. That's why this week's victory creating a NHTF is so crucial.
The original NHTF proposal would have earmarked $5 billion annually for affordable housing construction. They kept being told by Congress and HUD staff that this amount was too expensive, but it remains only half as much as the United States spends each month in Iraq.
The Housing Trust Fund provisions in the bill would target at least 75% of the funds to be used for rental housing to people with income below 30% of area median. All of the funds would have to benefit those with incomes below 50% of area median.
The bill places a cap on using housing trust fund resources for homeownership at 10%. This will help ensure that the housing trust fund focuses on the very lowest income households, which have the greatest housing affordability problems. The initial source of dedicated funding is the GSEs, but in the future other sources may be developed and will be needed to meet the goal of providing 1.5 million new affordable housing units over the next decade.
Source: BeyondChron.org