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Weekly update from the National Housing Conference
January 12, 2020
President's Message I By David M. Dworkin
Dear Friend,

2020 is off to a roaring start, and I’ll begin it by breaking my first New Year’s resolution; writing a sentence with six acronyms! With the publication last week of the Notice of Proposed Rulemaking (NPR) on the Community Reinvestment Act (CRA) by the Office of the Comptroller of the Currency (OCC) and the Federal Deposit Insurance Corporation (FDIC), though notably not the Federal Reserve Board (FRB), NHC  is gravely concerned that the important work of nearly all of our members could be significantly undercut. CRA modernization is easily the most impactful regulatory action we are likely to see this year. As I said in the American Banker, CRA modernization is “a once-in-a-generation opportunity. If modernization is done without broad support across the political spectrum, it’s just another swing of the pendulum that will cost banks hundreds of millions to retool the compliance system, and hundreds of millions more when the pendulum swings back and they have to retool again.” Worse, it will undercut efforts to help millions of low- and moderate-income people in communities that need CRA the most.

CRA was enacted in 1977 as it became clear that simply making discrimination illegal through the Fair Housing Act of 1968 was not sufficient to reverse the legacy of discrimination that permeated housing and community investment. CRA was meant to be an incentive for banks to reinvest in the communities where they were headquartered and had branches. Over the past 40 years, CRA has become an important tool to encourage bank lending, investment and services in underserved communities. This powerful incentive creates a benefit for the work nearly all of our members do. If you build affordable housing, banks get CRA credit for investing or lending to support it. If your community is underserved and a bank opens a branch, or makes mortgage loans, or supports community groups; they also get CRA credit. All of that activity supports their effort to get an Outstanding, or at least a Satisfactory, CRA rating from their regulator. If they don’t, it is harder for the bank to open or close branches, or merge with other institutions. There are also reputational costs and benefits associated with CRA.

The best banks, many of whom belong to NHC and work with so many of our members, are committed to this work, regardless of CRA. But they also compensate their employees on a risk-weighted return on capital to ensure they make safe, sound and successful investments, which is in all of our interest. CRA adds a community-friendly thumb on the scale in the competition over capital allocation that exists in every financial institution. Water down CRA, and you dilute the impact that CRA has in empowering banks to focus on the harder and smaller but still profitable deals, that often have disproportionately positive impact on communities. That’s why in over 90 meetings that the Treasury Department held with CRA stakeholders in 2017, not a single stakeholder, including dozens of banks and financial industry advocates, argued for the elimination of CRA. I know because as a Treasury Department senior advisor, I participated in over 80 of them. These stakeholders told us they wanted CRA regulation to be more transparent and predictable, while retaining flexibility so they could know when investments would get CRA credit. They did not tell us that they wanted CRA to be watered down or made less impactful with the ratio-driven approach that is the foundation of the new NPR.

To provide comprehensive, detailed, and useful comments on the proposal, NHC has convened a group of two dozen of our members, spanning some of the nation’s largest banks, nonprofit housing developers and community and civil rights advocates. Our work will be done under a very tight timeline, as the OCC and FDIC have only allowed for a 60-day comment period. As with our comment letter on the OCC’s Advanced Notice of Proposed Rulemaking (ANPR), we believe that our diverse members can come together to help us provide a similarly detailed and constructive comment letter. We will be aided by a pro-bono legal team of attorneys from Nixon Peabody in New York, one of the best law firms in the country, and students from Georgetown Law School. Our intention is to provide a written record of how CRA modernization can be successful, either for the current administration or future ones, should efforts to make the OCC’s approach acceptable fail. We encourage you to join this effort by reaching out to our Policy Director, Tristan Bréaux, at

David M. Dworkin
NHC President and CEO
News from Washington I By Tristan Bréaux and
Quinn Mulholland
Lawmakers introduce bills on public housing, vouchers before holiday recess

Lawmakers introduced a flurry of new housing-related legislation in the days before the holiday recess. On Dec. 17, Representative Carolyn Maloney (D-N.Y.) introduced the Public Housing Residents Protection Act, which would require public housing authorities that sell assets to ensure that these transactions financially benefit the residents of that public housing community. On Dec. 18, three housing-related bills were introduced in the Senate. Senators Todd Young (R-Ind.) and Chris Van Hollen (D-Md.) introduced the Family Stability and Opportunity Vouchers Act, which would create an additional 500,000 housing vouchers over five years for low-income families with young children. Senators Tammy Duckworth (D-Ill.), Dick Durbin (D-Ill.), and Cory Booker (D-N.J.) introduced the Averting Crises in Housing Assistance Act, which would require HUD to create a plan of action along with local public housing agencies to improve failing public housing developments. And Senators Tina Smith (D-Minn.) and Amy Klobuchar (D-Minn.) introduced the Public Housing Fire Safety Act to help public housing authorities install sprinkler systems in developments in the wake of a deadly fire in a Minneapolis public housing development that did not have sprinklers throughout the building. Klobuchar also recently released her housing platform as part of her presidential campaign. Then, on Tuesday, when the House of Representatives was back in session, Representative Cindy Axne (D-Iowa) introduced the Manufactured Housing Community Preservation Act, which would provide federal assistance for acquiring and preserving manufactured housing communities.
In Memory
NHC mourns the loss of a local housing leader, Todd A. Lee, of the D.C. Housing Finance Agency. We had the pleasure of having Todd serve on our Black Homeownership Working Group and speak at our Solutions for Affordable Housing convening, and we always enjoyed seeing him at our other events. He will be missed.

"Todd was a visionary leader and fundamentally good man. His passing is a loss for everyone who knew him and thousands of lives he impacted," shared David Dworkin.

We send our deepest condolences to his family, friends and close colleagues.
HUD releases annual homelessness report

On Tuesday, HUD released its full 2019 Annual Homeless Assessment Report to Congress. The data in the report, which Secretary Carson certified on Dec. 20, revealed homelessness in America rose 2.7 percent in 2019, driven by a whopping 16.4 percent increase in California. The 2019 Point-in-Time count found 567,715 were homeless nationwide on a given night. Other key findings from the report include a decrease of 2.1 percent in veteran homelessness and an increase of 8.5 percent in chronic homelessness. The day after the release of the HUD report, California Governor Gavin Newsom issued an executive order announcing that the state will open vacant state land to emergency shelters for individuals experiencing homelessness. Newsom also requested $1.4 billion as part of his budget proposal to the state legislature for various programs to address the housing and healthcare needs of California’s homeless.
HUD moves to roll back Obama-era fair housing rule

On Tuesday, HUD published its proposal for an updated Affirmatively Furthering Fair Housing (AFFH) rule, which would roll back parts of the Obama-era rule. The proposal, which was first reported by the Washington Post, would redefine fair housing standards, eliminate the assessment tool used to map racial segregation, and encourage local municipalities to roll back regulations that hinder housing production. At the event in Charlotte where he announced the proposal, HUD Secretary Ben Carson criticized the original AFFH rule, saying it “created a veritable ABC of unacceptable harms, including adverse outcomes, burdensome obligations, and cookie-cutter solutions.” The proposal was met with fierce criticism from congressional Democrats, with House Financial Services Committee Chairwoman Maxine Waters (D-Calif.) describing it as “yet another attack on fair housing protections” and Senate Banking Committee Ranking Member Sherrod Brown (D-Ore.) saying that Carson “must stop undermining HUD’s oversight of communities’ fair housing efforts and should not move forward with this rule.”
Congressional leaders write letters to Trump administration officials

Last month, lawmakers used their oversight powers to take action on several housing-related issues, sending letters to various Trump administration officials. On Dec. 17, a group of Senate Banking Committee Democrats led by Senator Mark Warner (D-Va.) sent a letter to Secretary Mnuchin and FHFA Director Mark Calabria calling for information on the administration’s timeline for releasing Fannie Mae and Freddie Mac from conservatorship. The same day, the chairmen and ranking members of the Senate Finance Committee and House Ways and Means Committee sent a letter to Mnuchin requesting the Treasury Department take action to clarify a provision under the Taxpayer First Act that has caused confusion in the mortgage industry. On Dec. 18, a group of Democrats in the House and Senate sent a letter to Secretary Carson raising concerns about HUD’s use of facial recognition technology in federally subsidized housing, and Senators Brown and Elizabeth Warren (D-Mass.) sent a letter to Comptroller General Gene Dodaro calling on the Government Accountability Office to investigate the Consumer Financial Protection Bureau’s failure to enforce fair lending laws. And on Dec. 19, Chairwoman Waters sent a letter to Carson criticizing HUD’s delayed release of the Notice of Funding Availability for FY 2019 funding for the Fair Housing Initiatives Program. Last week, congressional Democrats picked up where they left off, with a group of House Democrats led by Representative Emanuel Cleaver (D-Mo.) sending a letter to Secretary Carson on Wednesday calling for HUD to reconsider its proposal to curtail down payment assistance programs.
Register today for #Solutioncomms!
Trump signs $1.4 trillion spending deal

On Dec. 20, President Trump signed a $1.4 trillion spending package after lawmakers reached a deal to avoid a government shutdown. The package includes a total of $49.1 billion in FY 2020 funding for HUD, an increase of $4.9 billion above the 2019 level, as well as $3.8 billion for USDA rural development programs. It also includes a one-year extension of the new markets tax credit (NMTC), two disaster recovery measures expediting disaster recovery in California and Puerto Rico, and an extension of the National Flood Insurance Program’s authorization through September 2020, which drew praise from the National Association of REALTORS®. House Appropriations Subcommittee on Transportation, Housing and Urban Development (T-HUD) Chairman David Price (D-N.C.) praised the T-HUD spending bill included in the package, saying, “it invests in transportation and housing infrastructure, with an emphasis on bolstering safety, protecting vulnerable populations, and responding to the effects of climate change and the increasing frequency of natural disasters.” Chairwoman Waters, however, criticized the spending package for not containing “any significant new funding to tackle the homelessness crisis.”
Chart of the Week
House prices rise steadily as construction permits fluctuate

In a report published last month, the Federal Reserve Bank of St. Louis examined the implications for 2020 of housing construction permits. The researchers found that since 1992, the number of housing permits has fluctuated wildly from year to year, while national house prices have been generally more stable, increasing steadily except for a brief decline during the Great Recession.
SOURCE: Census Bureau, Federal Housing Finance Agency (FHFA), and calculations by Federal Reserve Bank of St. Louis |
What we're reading
In a longform article published Thursday, the Connecticut Mirror examined how wealthy towns keep housing voucher holders out. According to the article, 55 percent of Connecticut’s voucher holders live in neighborhoods with concentrated poverty, in part because of efforts by affluent communities to block affordable housing. Read the article here.

Brookings Institution fellow Jenny Schuetz examined ways to improve housing affordability in a policy brief published Tuesday. In the brief, Schuetz proposed a combination of zoning reform, a land value tax, and more housing subsidies to address the affordability crisis. Read the brief here.

In a recent article for the Washington Post, Center on Budget and Policy Priorities senior fellow Jared Bernstein, Urban Institute fellow Jim Parrott, and Moody’s Analytics chief economist Mark Zandi took a deep dive into “the conundrum affordable housing poses for the nation.” The authors start by examining the root causes of the crisis and then propose potential solutions. Read the article here.
The week ahead
Sunday, January 12
·          NCSHA 2020 HFA Institute, January 12-17

Tuesday, January 14
·          The Hill event on tackling homelessness, 8-10 a.m.

Wednesday, January 15

Thursday, January 16
·          NLIHC webinar on housing and the 2020 election, 3-4:15 p.m.

Friday, January 17

Saturday, January 18
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.
Defending our American Home since 1931
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