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Weekly update from the National Housing Conference
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In this issue
January 10, 2021
Issue 90-1
- Treasury issues guidance on distribution of emergency rental assistance funds
- Legal petition urges FEMA to update flood rules to protect affordable housing units
- NHC hosts industry introduction to HUD secretary nominee
- FHFA finalizes 2021 Duty to Serve plans
- Ginnie Mae plans to sunset temporary programs implemented in 2020
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Chart of the week: Housing supply reaches record low
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Find the information you need at NHC's COVID-19 Housing Resource Center
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Member Brief: 2021 - Another unprecedented crisis to begin the new year
by David M. Dworkin, NHC President & CEO
Dear Friend,
In a year of unprecedented crises and a week that saw us exceed 4,000 COVID-19 deaths in a single day, Jan. 6, 2021 may surpass any national trauma we’ve seen since the Civil War. Furthermore, events are moving so fast and furious, it is nearly impossible to keep up with them. So, let me try to capture some of the main takeaways from this week that may be useful as we sort out what is happening and what it means for our work on behalf of housing in America.
The full political impact of a president of the United States inciting a mob to wage an insurrection against the Constitutional process of his succession following an election certified by all 50 states is impossible to overstate. The 25th Amendment is not a viable option to remove the president. He can object and keep his job for up to three weeks while Congress votes – making it irrelevant in this scenario. In addition, it does not preclude him from seeking federal office in the future. An accelerated path to impeachment is already underway. If the House votes to impeach, pressure on the Senate for a speedy trial and conviction will depend on President Donald Trump’s actions going forward. However, the House could also choose to hold back sending the Articles of Impeachment to the Senate for months as circumstances continue to evolve. An immediate trial in the Senate would consume President-elect Joe Biden’s first 100 days agenda. A delayed trial would still allow Senators to decide if President Trump should be barred from federal office.
These decisions and their impact lie ahead of us, and it is not surprising that President-elect Biden has been firm but measured in response to this week’s events. In any case, confirmations of the Secretaries of State, Treasury and Defense that traditionally begin prior to the inauguration, will be stalled. Confirmation of House Democrats appointed to federal office, like HUD Secretary Designate Rep. Marcia Fudge, will be delayed to ensure Speaker Nancy Pelosi can manage her own very narrow majority.
The impact of the insurrection on the Republican Party will last for years and may present an existential challenge as open warfare between “the base” and the “traditional conservatives” escalates. It could also result in a hardening of the grip of the base in so many highly gerrymandered districts. It’s too early to tell. This period of uncertainty may offer opportunities to pass bipartisan legislation and, more importantly, to build relationships with moderate Republicans who will be less constrained by party discipline.
The impact on our international relations, already stressed beyond any modern comparison, will weigh heavily on the agenda and the schedule of the Biden White House, crowding out countless policy priorities unrelated to COVID-19 and economic recovery. Housing leaders should not underestimate how far down the priority list we are now that emergency rental assistance has been passed. There are short term opportunities in the economic recovery bill likely to emerge in the first weeks of the new administration. But we have to be strategic and focused on our priorities.
With the Senate split 50-50 (technically it is 50 R’s, 48 D’s and 2 I’s caucusing as D’s plus the vice president), Majority Leader Chuck Schumer and Minority Leader Mitch McConnell must work out how they will handle committee assignments and rules of procedure, most importantly, Rule 22, which governs the ability to consider legislation on the Senate floor, known as the filibuster rule. This may be the most consequential set of decisions in Senator Schumer’s career. If he goes with the “nuclear option” and eliminates the filibuster altogether, he risks ceding any influence should he lose one seat. While a power sharing agreement like the one negotiated in 2001 is unrealistic today, those with more ambitious agendas should prepare for some level of disappointment in the near future. The most likely scenario I can imagine is a carefully negotiated agenda of legislation to be brought to the floor during the first six months of the Biden administration, followed by regular order requiring 60 votes for legislation outside of the Budget Reconciliation process (where 60 votes are not required).
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Treasury issues guidance on distribution of emergency rental assistance funds
The Consolidated Appropriations Act passed at the end of December provided $25 billion in much-needed rental assistance. Following its passage, attention quickly turned to the task of distributing these funds to struggling tenants and landlords. “When the CARES Act was signed on March 27, 2020, it took the Treasury Department more than a month to issue guidance on the implementation of relief funds,” said NHC’s David Dworkin. “We simply don’t have that kind of time to waste now.”
This week, Treasury took the important step of clarifying the distribution process with formal guidance on the Emergency Rental Assistance Program. The guidance stipulates that at least 90% of funds received by eligible states, territories and local governments must be allocated to direct financial assistance, including rent, utilities and other housing-related expenses. The remaining funds may be used for housing stability services and administrative costs.
Treasury also provides details on grantee award submission and eligibility information for renters. Treasury defines “eligible households” as renter households that qualify for unemployment, have experienced a reduction in household income or financial hardship; demonstrate a risk of experiencing homelessness or housing instability; and/or have a household income at or below 80% of the area median income. Other details on payment amount calculations and Treasury oversight are forthcoming.
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Legal petition urges FEMA to update flood rules to protect affordable housing units
“Updating national standards will help communities be better prepared to handle the floods of today and better anticipate the flood risks of tomorrow – and in doing so, save lives, protect property from the impacts of climate change, and reduce disaster costs,” said Chad Berginnis, ASFPM executive director.
Research warns that the number of affordable housing units at risk of coastal flooding and sea level rise will likely triple in the next 30 years, with thousands of units at risk of “chronic coastal flooding” in Atlantic City, New York City and Boston. “The American dream of homeownership becomes a nightmare when homes are built in areas that flood today and will be more vulnerable in the future,” said Joel Scata, an attorney with NRDC. “FEMA’s building standards do not reflect the threats from climate-related flooding… FEMA has the power to spare millions of people the misery of living with rising waters.”
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NHC hosts industry introduction to HUD secretary nominee
This week, NHC was pleased to host an industry call to introduce housing leaders to Rep. Marcia Fudge (D-Ohio), President-elect Joe Biden’s nominee for secretary of the Department of Housing and Urban Development (HUD). Rep. Fudge shared her career-long commitment to public service and invited call participants to discuss some of their policy priorities and concerns for 2021.
Members of the HUD transition team joined the call, as well as executives and policy leaders from more than two dozen housing organizations, including the Affordable Housing Tax Credit Coalition, Habitat for Humanity, Manufactured Housing Institute, Mortgage Bankers Association, National Association of Real Estate Brokers and NeighborWorks America. Many participants’ priorities overlapped, including the importance of reinstating the Affirmatively Furthering Fair Housing and Disparate Impact Rule, a declarative statement on Deferred Action for Childhood Arrivals eligibility for Federal Housing Administration mortgages, increasing access to credit for low-income homeowners, addressing the housing supply crisis and closing the Black homeownership gap.
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NHC welcomes new members!
A trusted, nonpartisan voice for Latinos, UnidosUS serves the Hispanic community through research, policy analysis, and state and national advocacy efforts, as well as in its program work in communities nationwide.
The Alliance for Housing Solutions is a Virginia-based nonprofit working to increase the supply of affordable housing in Arlington County and Northern Virginia through public education, policy development, advocacy and innovation.
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FHFA finalizes 2021 Duty to Serve plans
The Federal Housing Finance Agency (FHFA) finalized the 2021 Duty to Serve Underserved Markets Plans for Fannie Mae and Freddie Mac. Instead of implementing entirely new plans for 2021 through 2023, FHFA opted to extend the 2018 through 2020 plans, citing the “potential market disruption and uncertainty” caused by the COVID-19 pandemic.
In September, FHFA proposed changes to the 2020 objectives in the GSEs’ 2018-2020 Underserved Markets Plans. The modifications incorporated into the 2021 extension cover a wide range of programs, including affordable housing preservation, manufactured housing and rural housing.
Both Fannie Mae and Freddie Mac released statements in response to the 2021 plan. “In 2021, Fannie Mae is proud to continue our Duty to Serve work in the manufactured housing, affordable housing preservation, and rural housing markets to support sustainable homeownership, safe rental communities, and innovative housing finance solutions in order to help more families have a place to call home,” said Jeffery Hayward, Fannie Mae’s executive vice president and chief administration officer.
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Ginnie Mae plans to sunset temporary programs implemented in 2020
“We recognize that the task of navigating through the COVID-19 pandemic is not yet complete, but the new year provides an opportunity to begin shifting our focus to what must occur next,” said Ginnie Mae. “The MBS Program initiatives implemented this year… could not be sustained in perpetuity in their present form without detriment to the overall program. As a result, Ginnie Mae expects to amend or retire many of the temporary programs put in place in 2020, and renew its focus on our previously published strategic agenda.”
Programs like Pass-Through Assistance and Temporary Relief from the Acceptable Delinquency Thresholds Requirements are already set to expire. Ginnie Mae will continue to monitor economic conditions that may alter its decision to sunset temporary programs, but said it “does not anticipate doing so absent elevated delinquencies or other adverse economic developments.”
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Chart of the week: Housing supply reaches record low
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A new report on use of the Low Income Housing Tax Credit (LIHTC) from LeadingAge and National Housing Trust examines how states have deployed the tax credit to develop and preserve affordable senior housing. The report highlights the important role LIHTC plays in ensuring older adults have access to affordable housing and examines how different state housing finance agencies have used housing credits to serve aging populations. “By understanding the range of ways in which states incentivize housing and services for older adults, advocates will be well positioned to advocate for specific changes within their state’s existing Qualified Action Plan,” the report states.
Amazon announced the launch of a new $2 billion housing equity fund this week. The new investment will be used to fund the development and preservation of more than 20,000 affordable housing units across three communities where Amazon expects to employ 5,000 or more employees in the coming years, including Arlington, Virginia, the Puget Sound region in Washington and Nashville, Tennessee. Amazon’s fund will also provide $125 million in grants to minority-led organizations and public agencies.
Los Angeles Times reports on the devastating effect of the recent surge of COVID-19 among homeless populations in California. The article cites the dramatic rise in infections in homeless individuals, which has overwhelmed most shelters in Los Angeles. In December, the Los Angeles County Department of Health Services opened four new isolation centers for homeless individuals with the virus. “The rapid response was partly assisted by the state’s Project Homekey program,” Los Angeles Times reports.
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Monday, January 11
Tuesday, January 12
Wednesday, January 13
Thursday, January 14
Friday, January 15
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The National Housing Conference has been defending the American Home since 1931. We believe everyone in America should have equal opportunity to live in a quality, affordable home in a thriving community. NHC convenes and collaborates with our diverse membership and the broader housing and community development sectors to advance our policy, research and communications initiatives to effect positive change at the federal, state and local levels. Politically diverse and nonpartisan, NHC is a 501(c)3 nonprofit organization.
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Defending our American Home since 1931
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