Senator John Kerry (D-Mass.) urged his colleagues today to adopt the Senate's Economic Stimulus Package, which will strengthen America's economy and help more families avoid foreclosure. The Senate package will keep more Americans in their homes with an expansion of the mortgage revenue bond program that will help struggling home owners refinance. It will also immediately inject needed help into the economy by delivering relief to 20 million seniors and 250,000 disabled veterans.
Sen. Kerry worked with Sen. Gordon Smith (R-Ore.) to include a provision in the Senate Finance Committee package that would provide an additional $10 billion of tax-exempt private activity bonds to be used to refinance subprime loans, and provide mortgages for first time homebuyers and for multifamily rental housing.
"We've produced a good economic stimulus package which helps address our economy's biggest problem, the housing crisis," said Kerry. "The Senate package ensures that we deliver needed relief to all Americans, including struggling homeowners, seniors, and veterans, who need help the most."
Approximately, 1.7 million subprime ARMs worth $367 billion are expected to reset during 2008 and 2009. According to the National Association of Home Builders, every new mortgage revenue bond home loan produces almost two full-time jobs, $75,000 in additional wages and salaries and $41,000 in new federal, state and local revenues. Also, each new home loan results in an average of $3,700 in new spending on appliances, furnishings, and property alterations.
Kerry received the following letter yesterday, which was addressed to Majority Leader Harry Reid, Minority Leader Mitch McConnell, Finance Committee Chair Max Baucus and Ranking Member Charles Grassley from twenty-one industry groups, which urged the Senate to adopt a package that includes a strong Housing Bond program:
The undersigned state and local government, housing, and industry organizations urge you to include in the economic stimulus bill urgently needed relief for American families hardest hit by today's housing crisis. We ask you to seize this opportunity to help families save their homes from foreclosure, create affordable ownership and rental housing opportunities for lower-income families, and stabilize neighborhoods rocked by foreclosures and declining house prices, all while providing an immediate boost to the housing sector and the economy.
Please insist that the final economic stimulus bill you agree to with the House include the $10 billion increase in state tax-exempt Housing Bond authority and refinancing ability the Finance Committee bill provides. Sponsored by Senator John Kerry (D-MA) and Senator Gordon Smith (R-OR), this provision was adopted by the Finance Committee by an overwhelming bipartisan vote of 20 to 1.
The Administration called on Congress last November and again in his recent State of the Union address to enact similar legislation. The President on February 1 repeated this appeal in remarks he made on the economy.
In the wake of the subprime mortgage and deepening housing crisis, lower-income homeowners and buyers have few affordable mortgage products available to them. They are turning increasingly to state Housing Finance Agencies for low-cost Mortgage Revenue Bond (MRB) loans, but state Housing Bond authority is oversubscribed in virtually all states and must be rationed to respond to both single-family and multifamily affordable housing needs.
The Housing Bond program has a long record of producing outstanding affordable housing results. In addition to providing desperately needed affordable ownership and rental housing, it supports economic growth by creating new jobs; generating federal, state, and local revenues; and inspiring home-related consumer spending.
The Housing Bond program is a highly effective and proven system for financing affordable ownership and rental housing. It has strong bipartisan support in Congress.
Please do not let this opportunity pass. Get housing relief to America's working families now, while stimulating the housing sector and economy.
National Council of State Housing Agencies
Affordable Housing Tax Credit Coalition
Corporation for Supportive Housing
Council of State Community Development Agencies
Enterprise Community Partners
Local Initiatives Support Corporation
Mortgage Bankers Association
National Apartment Association
National Association of Counties
National Association of Home Builders
National Association of Housing and Redevelopment Officials
National Association of Local Housing Finance Agencies
National Association of REALTORS
National Housing Conference
National Housing Trust
National League of Cities
National Low Income Housing Coalition
National Multi Housing Council
Securities Industry and Financial Markets Association
The Real Estate Roundtable
cc: United States Senators