Housing Action Alert and Update – Kathy Kregor - Legislative Advocacy Committee

Action Needed:

Call and request that your U.S. representatives vote in favor of an Affordable Housing Fund which could be established through funding from the government sponsoring enterprise (GSE), Fannie Mae and Freddie Mac (H.R. 1461). *

 

Background - Federal Housing Finance Reform Act of 2005 (H.R. 1461)

On May 25, the Financial Services Committee of the U.S. House of Representatives approved the "Federal Housing Reform Act of 2005," a bill to strengthen federal regulation of Fannie Mae and Freddie Mac.

 

A provision in the bill requires that 5% of the after tax profits of Fannie Mae and Freddie Mac be used to fund affordable housing. The initial estimate is that 5% of their profits will be $400-$600 million in the first years and will go as high as $1 billion annually eventually. The resources would produce, preserve and rehabilitate housing that the lowest income people can afford.

 

The funds can be used for capital grants for the production, preservation, and rehabilitation of rental housing, as well as assistance for first time homebuyers. A small part of the funds would be used to leverage other money to support housing and economic development. The funds can be used for direct housing purposes only and not for administrative expenses. At least 10% of the funds are to go for home ownership. There is a preference for projects that will benefit extremely low income families.

 

The bill is expected to go to the House floor for a vote after the July 4 recess. A similar bill is pending in the Senate.

 

 

For More Information: This alert contains excerpts and information from the housing updates issued by the USCCB and Network. These updates can be found at www.usccb.org/sdwp/national/trustfund605.htm and www.networklobby.org/issues/trust_fund.htm

 

* An E mail letter in support of this legislation is available at the Network site http://capwiz.com/networklobby/issues/alert/?alertid=7713351&type=CO