In an effort to strengthen our economy and increase the supply of affordable rental housing across the country, U.S. Sen. Sherrod Brown (D-OH) and 32 of his colleagues sent a letter to Mel Watt, the Director of the Federal Housing Finance Agency (FHFA), urging him to end the suspension of contributions to the National Housing Trust Fund (NHTF) and the Capital Magnet Fund (CMF) within all applicable laws, rules, and regulations.
In December of 2013, the U.S. Senate confirmed Mel Watt to lead FHFA as the country's top housing regulator, overseeing more than $5 trillion in funding for the U.S. mortgage market.
The National Housing Trust Fund and the Capital Magnet Fund were created in 2008 as part of the Housing and Economic Recovery Act to address the shortage of affordable rental housing, and neither the National Housing Trust Fund nor the Capital Magnet Fund have been consistently funded as intended. As the FHFA's newly confirmed Director, Mr. Watt has the power to lift the suspension. The senators noted: "The time is long overdue to lift the current suspension of contributions to the NHTF and CMF, and we ask your full and fair consideration of this request."
Full text of the letter follows:
The Honorable Mel Watt
Federal Housing Finance Agency (FHFA)
400 7th Street, SW
Washington, DC 20024
Dear Director Watt:
We write first to congratulate you on being confirmed and sworn in as Director of the Federal Housing Finance Agency (FHFA). We also share your concern about the need for more affordable rental housing in this country and ask that you end the suspension of contributions to the National Housing Trust Fund (NHTF) and the Capital Magnet Fund (CMF), in a manner fully consistent with all applicable laws, rules, and regulations.
The affordable rental housing crisis that prompted Congress, on a bipartisan basis, to create the NHTF and CMF has only gotten worse in the last five years. Since passage of the Housing and Economic Recovery Act in 2008, the number of homes that are affordable to renters with incomes at or below 30 percent of area median income decreased by more than 1 million units. According to the Harvard Joint Center for Housing Studies, there is currently a national shortage of nearly 5 million units affordable and available to extremely low-income renters. Funding the NHTF and CMF would help ameliorate this crisis.
We are all committed to reforming the mortgage finance system and do not believe Fannie Mae and Freddie Mac should be returned to their previous form. However, directing much needed funding for affordable rental housing should not wait until Congress and the President are able to agree on a new system. The time is long overdue to lift the current suspension of contributions to the NHTF and CMF, and we ask your full and fair consideration of our request.
We look forward to hearing from you in a timely fashion and working with you as FHFA Director on this and other important matters.