Housing -- Bill Eliminating the NHTF Passes Financial Services Subcommittee

From: NLIHC [mailto:memotomembers@nlihc.org]


Sent: Wednesday, July 13, 2011 5:06 PM

Subject: UPDATE on the National Housing Trust Fund



National Housing Trust Fund <http://www.nhtf.org/>

Bill Eliminating the NHTF Passes Financial Services Subcommittee <http://capwiz.com/nlihc/utr/1/KBRUQEKTNA/FFSUQEMHVA/7125642181>



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The House Financial Services Subcommittee on Capital Markets and Government Sponsored Enterprises (GSEs) approved a package of bills intended to dismantle the housing GSEs, Fannie Mae and Freddie Mac, in a Subcommittee markup on Tuesday, July 12. One of the bills, H.R. 2441, introduced by Representative Ed Royce (R-CA), would abolish the National Housing Trust Fund (NHTF) as well as the Capital Magnet Fund. The bill passed by a vote of 18 to 14, along party lines.



In the markup, Mr. Royce said that the NHTF should be abolished because "the money would subsidize lobbying and campaign related activities" by groups such as the now-defunct ACORN. However, the NHTF statute explicitly prohibits the use of NHTF dollars for political activities, lobbying, counseling, outreach, and project administration.



Financial Services Ranking Member Barney Frank (D-MA) participated in the markup to defend the NHTF, even though he is not on the Subcommittee. Mr. Frank referred to the conversation about ACORN as a "red herring" and clarified that nothing in the NHTF statute empowers ACORN. Subcommittee Ranking Member Maxine Waters (D-CA) and Representative Al Green (D-TX) supported this point and asked that the record reflect this fact.



Mr. Green offered an amendment to H.R. 2441 that would have decoupled the NHTF from the GSE funding streams. Although initial funding for the NHTF was to come from Fannie Mae and Freddie Mac, they were taken over by the Federal Housing Finance Administration in September 2008 and never made a contribution to the NHTF.



The statute authorizing the NHTF also allows for funding from other sources.



Supporting the Green Amendment, Ms. Waters stated that the NHTF should be decoupled from the GSEs, and that is inappropriate to abolish the NHTF altogether. She said future Congresses should have the option to fund the NHTF if they choose to do so.



Following lengthy debate, Mr. Green's amendment was defeated by a vote of 15-17. One Republican, Representative Robert Dold (R-IL), voted in support of the Green Amendment.



Representatives Ruben Hinojosa (D-TX), Carolyn Maloney (D-NY) and Ed Perlmutter (D-CO) also made statements in support of the NHTF during the mark up.



The next step would be for H.R. 2441 to be considered by the full committee. There was extensive debate about if and when the full Committee on Financial Services will consider GSE reform and whether H.R. 2441 will be one of the measures considered.



NLIHC will continue to monitor activity around this bill and send updates, as needed. Please email us at outreach@nlihc.org with any questions you may have.

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