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Weekly update from the National Housing Conference |
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In this issue
August 8, 2021
Issue 90-31
• CDC extends eviction moratorium for counties with increased COVID-19 spread
• Housing stakeholders push back on using g-fees to pay for infrastructure
• Ginnie Mae prepares to close single-family issuer eligibility RFI
• Treasury publishes new ERA and HAF guidance
• LIIF launches Black capital fund
• Banking Commitee holds hearing on Gordon, other HUD nominees
• Chart of the week: Northern Virginia fails to respond to increased housing demand
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Find the information you need at NHC's COVID-19 Housing Resource Center |
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It's finally infrastructure week
By Emily Cadik, executive director of the Affordable Housing Tax Credit Coalition
This week, the Senate is poised to pass a bipartisan infrastructure package that – though it does not include housing – paves the way for progress on a second infrastructure package that may include the most significant investments in affordable housing in decades. After years of false starts, we are seeing real progress towards finally making many long-overdue investments in our nation’s infrastructure. And as the housing community has been saying for years, housing is infrastructure.
While the bipartisan infrastructure package focuses generally on ‘traditional’ and ‘hard’ infrastructure like roads and bridges, congressional leadership and the White House have made clear that a second legislative package, focused on ‘human’ infrastructure priorities, must advance hand-in-hand. This second package, currently under development, could total up to $3.5 trillion and will include many Democratic priorities that would advance through the budget reconciliation process, in which only Democratic votes are needed. While we do not yet know how much funding will be devoted to housing, it is incumbent on housing advocates to make sure housing gets the share it deserves.
The Affordable Housing Tax Credit Coalition, NHC and our partners in the ACTION Campaign are working hard to ensure that the Low-Income Housing Tax Credit is expanded and strengthened as part of this second infrastructure package. We are advocating to advance key provisions from the Affordable Housing Credit Improvement Act (AHCIA), including increasing the annual Housing Credit allocation, increasing access to Private Activity Bond resources used to finance affordable housing by lowering the bond financing threshold, and other proposals to strengthen the Housing Credit. Taken together, the proposals in the AHCIA could finance the development of more than more...
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News from Washington | By Luke Villalobos
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CDC extends eviction moratorium for counties with increased COVID-19 spread
On Tuesday, the Centers for Disease Control and Prevention (CDC) extended the federal eviction moratorium until October 3rd for certain counties, days after the expiration of the moratorium on July 31. The new moratorium will be in effect for counties that are experiencing “substantial and high levels of community transmission levels” of the COVID-19 virus, which by the CDC’s definition includes the majority of counties in the country. The decision will likely face legal battles based on language from Supreme Court Justice Brett Kavanaugh’s recent opinion that the CDC overstepped its authority in declaring the moratorium.
President Biden initially cited Kavanaugh’s opinion when his administration allowed the moratorium to lapse, saying that it was up to Congress to enact a new federal moratorium. When that effort was unsuccessful, the administration asked local governments to enact individual moratoria, and several federal agencies took steps to limit evictions themselves. As pressure mounted for quick action in the face of the Delta variant, however, the CDC ultimately signed an order extending the moratorium.
According to CDC Director Rochelle Walensky, “The emergence of the delta variant has led to a rapid acceleration of community transmission in the United States, putting more Americans at increased risk, especially if they are unvaccinated. This moratorium is the right thing to do to keep people in their homes and out of congregate settings where COVID-19 spreads.” Walensky further explained that the extension would allow more time for emergency rental assistance to be distributed to those who were economically impacted by COVID-19, a chief concern of housing advocates.
Many landlord and real estate organizations are opposed to the extension. A statement from a coalition of organizations led by the National Multifamily Housing Council argued that the bigger issue is the slow delivery of ERA funds and argues that further moratoria will have broader negative impacts to the real estate market as renters continue to accrue back rent and landlords are left “in limbo” during the moratorium. NHC was a strong advocate for emergency rental assistance, and believes the effective administration of ERA funds is vital to stabilizing tenant economic security as the pandemic continues.
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Housing stakeholders push back on using g-fees to pay for infrastructure
Senators are planning to extend a 10-basis point guarantee fee added to mortgage-backed securities (MBS) sold by Fannie Mae and Freddie Mac to fund the bipartisan infrastructure bill currently under consideration, according to legislative text unveiled Monday. Guarantee fees, or “g-fees”, are typically levied on Enterprise MBS to cover the risk of guaranteeing them, but the 10-basis point fee was created by Congress in 2011 to pay for a two month payroll tax holiday. The fee was originally set to expire October 1.
Housing stakeholders have argued against using g-fees to fund infrastructure spending, noting that they act as a regressive tax on homeownership that disproportionately harm first-time homebuyers and people of color. NHC recently signed a letter arguing that using g-fees to fund non-housing-related activities would be inappropriate at a time of unprecedented housing cost increases. NHC member National Fair Housing Alliance recently circulated a letter that urged Congress to eliminate the fee entirely, noting that the fee’s impact on borrowers of color is likely to hurt the entire mortgage market as non-White consumers make up an increasing share of prospective homebuyers.
NHC president and CEO David M. Dworkin has argued that if Congress does extend the fee, the funds it generates should be used to support homeownership, such as through funding a downpayment assistance program. NHC recently sent a letter making that case to National Economic Council Director Brian Deese and National Domestic Policy Council Director Susan Rice, two chief White House infrastructure negotiators.
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Ginnie Mae prepares to close single-family issuer eligibility RFI
NHC members and other stakeholders are preparing to submit comments in response to Ginnie Mae’s request for information (RFI) on proposals to tighten standards for issuers of government-backed single-family MBS. Proposed changes to issuer eligibility requirements include increasing requirements for issuer net worth and liquidity and creating a new risk-based capital ratio minimum requirement of 10% for non-bank single-family issuers.
Since the Great Recession, Ginnie Mae has made regular updates to its requirements for issuers of government-backed MBS. Ginnie Mae’s RFI notes that the corporation has sought to balance raising standards for issuers to address changes in market conditions with minimizing disruptions for firms involved in the government-backed MBS market. The changes proposed in the current RFI “underscore...Ginnie Mae’s commitment to continuously assess its MBS Guide requirements with a goal of continuing to ensure Issuer success in our program while minimizing risk to the government’s unconditional guarantee,” said Ginnie Mae Senior Vice President and Chief Risk Officer Gregory Keith.
Comments are due to Ginnie Mae August 9.
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Treasury publishes new ERA and HAF guidance
On Monday, the Treasury Department updated its guidance for the distribution of the Homeowners Assistance Fund (HAF) and published additional resources for the program. The new guidance details requirements around qualified expenses, eligible homeowners, targeting and payments, plan requirements and program design. The Department announced that there will soon be a portal for grantees to submit HAF plans and that it will require plans to be submitted within 14 days of the portal becoming active, with the exception of plans from tribal entities. Treasury also provided template plans for grantees in order to help expedite the process.
On Wednesday, Treasury issued another statement calling for state and local governments to eliminate any unnecessary barriers to delivering Emergency Rental Assistance (ERA) funds. ERA delivery has proceeded much slower than anticipated, leading to the extension of local and federal eviction protections. Although recent reports have shown that ERA delivery is accelerating, the initial data shows many ERA programs were just launched in recent weeks. According to Treasury, eliminating documentation burdens and simplifying the process will help streamline the distribution efforts. States with successful programs, such as Virginia, were highlighted in Treasury’s statement as examples for areas struggling to distribute funds.
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LIIF launches Black capital fund
NHC member Low Income Investment Fund (LIIF) announced a $70 million initiative to support Black-led affordable housing developers on Monday. The effort, called the Black Developer Capital Initiative (BDCI), was launched in partnership with the National Affordable Housing Trust (NAHT) and will provide Black-led developers with capital at early stages of development. It will also grant them access to LIIF’s $50 million Low-Income Housing Tax Credit (LIHTC) equity fund. NHC members Bank of America and Wells Fargo each contributed $10 million to the effort.
BDCI is part of LIIF’s effort to invest $5 billion in efforts to close racial disparities over the next decade and bring the organization in line with its recently refined mission to center racial equity. LIIF Director of Racial Equity and Impact Lending Eliisa Frazier noted that the initiative is structured to eliminate some of the systemic barriers to credit access faced by Black-led organizations. “Rather than asking ‘how Black developers should change to access capital,’ LIIF and NAHT are asking how we should change,” she said, saying that BDCI would focus “on experience rather than wealth as the main underwriting criteria for qualification.”
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Banking Commitee holds hearing on Gordon, other HUD nominees
On Thursday, the Senate Committee on Banking, Housing, and Urban Affairs held a hearing on Julia Gordon’s nomination as Federal Housing Commissioner, Dave Uejio as HUD Assistant Secretary for Fair Housing and Equal Opportunity and Solomon Greene as HUD Assistant Secretary for Policy Development and Research.
Banking Committee Chairman Sherrod Brown (D-Ohio) noted in his remarks that 115 letters were sent in support of Gordon’s nomination, including one from NHC, 40 were sent in support of Uejio, and 31 in support of Greene. Topics of discussion during the hearing included the racial homeownership gap, affordable housing supply, transit and housing development, and assistance for first time homebuyers.
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Chart of the week: Northern Virginia fails to respond to increased housing demand
Analysis from Brookings finds that Virginia counties in the Washington Metropolitan Area were far less responsive to increased housing demand than were counties in the Richmond and Hampton Roads areas, likely the result of zoning in those jurisdictions that has been less responsive to increasing population. “In states such as California and Massachusetts, local zoning regulations now add up to a substantial drag on the overall statewide housing supply—a cautionary tale that Virginia should avoid,” writes author Jenny Schuetz.
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The Washington Post editorial board argues that the reason behind a potential eviction crisis will not be an expiration of the CDC’s eviction moratorium, but rather a failure to distribute $47 billion of ERA funds. “The best idea all along was not an eviction moratorium but rental assistance, so that hard-hit tenants could keep their homes and landlords, who still have to service their properties, could also get a lifeline,” they write. “The transition from moratorium to rental assistance should have been smooth. It has instead been devastatingly inefficient: States have distributed only about $3 billion of the $47 billion.”
An article from Novogradac provides an overview of the various housing investments that are proposed in the reconciliation bill, and the likeliness of those investments coming to fruition. Since the bipartisan infrastructure bill has narrowed the scope of infrastructure to “hard” infrastructure, reconciliation offers an opportunity for Democrats to make the most substantial investments in housing and community development in decades.
The National Alliance to End Homelessness published an interactive State of Homelessness: 2021 Edition map to visualize data from the January 2020 Point-in-Time count. The infographics illustrate research on the population of people experiencing homelessness, including population demographics, populations most at risk, trends in homelessness, and COVID-19 impact.
Politico explains the various federal protections against foreclosure, including the Federal Housing Finance Agency’s forbearance program for Enterprise-backed borrowers and FHA’s ban on foreclosures against borrowers with government mortgages. The explainer notes that an increasing number of borrowers in forbearance have been in forbearance for more than 12 months, and cites HAF as an important tool to prevent foreclosure on them.
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Monday, August 9
Tuesday, August 10
Wednesday, August 11
Thursday, August 12
Friday, August 13
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The National Housing Conference is a diverse continuum of affordable housing stakeholders that convene and collaborate through dialogue, advocacy, research, and education, to develop equitable solutions that serve our common interest. |
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