Weekly update from the National Housing Conference
September 29, 2019
President's Message I By David Dworkin
Dear Friend,

This week, the Federal Housing Finance Agency (FHFA) announced a new directive that will go a long way towards avoiding concentrated market share, one of the single largest factors leading to the failure and subsequent conservatorship of the housing government sponsored enterprises (GSEs), Fannie Mae and Freddie Mac. This critical issue, that until now has received short shrift by both the Trump and Obama administrations, fueled the “race to the bottom” – not affordable housing goals as alleged by some commentators. This was a major finding of the report of the Financial Crisis Inquiry Commission. The FHFA directive announced this week creates a new reality in the traditional business model of the GSEs, beginning a process of turning them into government sponsored utilities, rather than for-profit enterprises. How it was announced, however, is also a new reality. 

We’ve addressed a lot of issues in our Member Brief, but this is the first time we have ever addressed a “regulatory tweet.” I still can’t get over that I have used the term “regulatory tweet” but I’m afraid I must. At the risk of sounding like the old guy on the porch shouting, “get off my lawn” I will add that I hope I never do it again! I’ll explain why it’s such a big deal, but first, here’s what happened.

For more on the tweet and why it is so important, click here.

David Dworkin
NHC President and CEO
News from Washington I By Tristan Bréaux and
Quinn Mulholland
NHC advocacy on CRA

NHC recently organized a group of organizations to write a letter to Federal Reserve Chairman Jerome Powell, Comptroller of the Currency Joseph Otting and Federal Deposit Insurance Corporation Chairwoman Jelena McWilliams insisting that action to modernize the Community Reinvestment Act (CRA) be done jointly by all three agencies. It also emphasized that “we would have serious concerns about a metrics framework based primarily on a ratio of the aggregate dollar volume of a bank’s CRA balance sheet to the bank’s deposit or asset base, whether at the assessment area level or institution-wide, that would drive a presumptive CRA rating.” The letter noted that “a dollar volume target would reduce CRA to a limited resource, for which each eligible activity must compete against all others. If CRA activity is to be rationed, then the threshold for eligibility will have to be rigorous, the best will become the enemy of the good, and in some cases burdensome documentation will be required to screen out activities whose benefits are harder to prove." The letter was drafted by NHC, the National Community Reinvestment Coalition and the National Association of Housing Lenders and was signed by over two dozen organizations, including NHC board members from Enterprise Community Partners, Local Initiatives Support Corporation, Mortgage Bankers Association, National Community Stabilization Trust, National Housing Trust, NYU Furman Center, Stewards of Affordable Housing for the Future, SKA Marin, and the Tennessee Housing Development Agency.
Chart of the Week
Consumer access to credit varies widely across the country

A recent report from the Federal Reserve Bank of New York found that access to credit varies widely across the country and is worse overall than previously thought. The report found that in the fourth quarter of 2018, 426 counties, primarily concentrated in the South, were credit-insecure, meaning consumers in those counties had a severe lack of access to credit.
Carson defends White House plan on homelessness

In appearances on WBUR and Fox News, HUD Secretary Ben Carson defended the recent White House report on how to deal with the nation’s homelessness crisis amidst fierce criticism of the report by advocacy groups. Nan Roman, CEO of the National Alliance to End Homelessness and a member of NHC’s Board of Governors, told CityLab, “The paper was clear that it’s not proper to criminalize or arrest people for being homeless. It still was chilling.”

Local homeless advocates in D.C. echoed Roman’s concerns about the White House report. Tristia Bauman of the National Law Center on Homelessness and Poverty told WAMU that “sweeping homeless encampments and not giving people a good adequate alternative where they can stably be will not have the effect of reducing homelessness. What it will do is waste resources on a losing strategy that will not produce the desired outcome.”
House Financial Services Committee holds two housing hearings

Two House Financial Services subcommittees held hearings last week on housing-related issues. The Subcommittee on Diversity and Inclusion  held a hearing on the racial and gender wealth gap in America on Tuesday. In her opening statement at the hearing, Chairwoman Joyce Beatty (D-Ohio) mentioned homeownership as one of the most powerful wealth-building tools, saying, “The homeownership rate for black households today is the same as it was in 1967 when race-based discrimination in housing was legal. It did not happen by accident.”

On Wednesday, the Subcommittee on Housing, Community Development, and Insurance  held a hearing on the FHA’s Home Equity Conversion Mortgage (HECM) program. The hearing focused on two pieces of legislation,  one introduced by Chairman Lacy Clay (D-Mo.) and  the other by Representative Denny Heck (D-Wash.), that would add safeguards to the HECM program to, among other things, protect seniors from foreclosures on reverse mortgages.
Ocasio-Cortez introduces sweeping housing-related legislation

On Wednesday, Representative Alexandria Ocasio-Cortez (D-N.Y.) introduced an ambitious legislative blueprint for what Ocasio-Cortez calls “A Just Society.” The plan is comprised of six bills, one of which is focused on housing and proposes a host of housing reforms, including national rent control, source of income protections, funding for lead abatement and discouraging exclusionary zoning rules. The plan was drafted in concert with the advocacy group Center for Popular Democracy, which recently launched a campaign for greater tenant protections and other housing reforms. Another bill aimed specifically at curbing evictions was introduced in the Senate recently by Senators Maggie Hassan (D-N.H.), Tim Kaine (D-Va.) and Chris Van Hollen (D-Md.).
D.C. releases results of survey on affordable housing distribution

Washington, D.C. planning officials released the results of a survey commissioned by the city’s Department of Housing and Community Development and Office of Planning on the distribution of affordable housing in the city. According to the survey results, over three-quarters of D.C. residents said the current distribution of affordable housing in D.C. is unfair, since it is overly concentrated in less affluent areas east of the Anacostia River. Mayor Muriel Bowser echoed the survey results at a panel discussion at ULI’s Fall Meeting, saying that she wants to build more affordable housing in affluent areas west of Rock Creek Park. Bowser argued that shame can be a powerful motivator when it comes to getting local officials in these areas to build their fair share of affordable housing.
What we're reading
In an article published on Tuesday, the New York Times examined concerns over the use of facial recognition technology in public housing developments. Former NHC Board of Governors member Sandra Henriquez is quoted in the article defending the use of the technology as a means of ensuring residents’ security. Read the article here.

An NBC News investigation published last week shined a spotlight on harrowing conditions in rural housing complexes subsidized by the USDA’s Rural Housing Service. The investigation found that residents of one complex in Florida had to live with mold, roaches and rats in their homes. Read the article here.

The Washington Post profiled a resident of D.C.’s Shaw neighborhood who was forced to move when the owner of her apartment building decided to convert it into high-end condominiums. The article examines the larger forces driving gentrification and displacement in D.C. and the impact that they are having on long-time residents of neighborhoods like Shaw. Read the article here.
The week ahead
Wednesday, October 2

·          Multifamily Executive Conference, Oct. 2-4
·          ULI Washington’s 5th Annual Trivia Night, 6 p.m.

Thursday, October 3

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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