The Trust Fund was established in 2007 to provide grants to states to increase and preserve the supply of rental housing for extremely low- and very low-income families, including homeless families; and to increase homeownership for extremely low- and very low-income families.  Authorization for the Trust Fund was included in § 1131 of the Housing and Economic Recovery Act (P.L. 110-289) in July 2008. Under the statute, the Trust Fund funding will be distributed by a needs-based formula for the production, preservation and rehabilitation of rental housing and housing for homeownership. At least 75 percent of funds are designated for extremely low-income families and no more than 10 percent of are reserved for first-time homeownership assistance such as down payment and closing cost assistance, or assistance for interest rate buy-downs.

 

As noted in the press release below, the Obama Administration strongly supports the Trust Fund and included $1 billion for it in its FY 2010 budget request. Most recently, the House capitalized the Trust Fund in the amount of $1 billion in H.R. 2847, the Jobs for Main Street Act.  The Senate passed an amended version of H.R. 2847 that did not include funding for the Trust Fund, and Chairman Frank hopes to retain provisions to provide $1 billion for the Trust Fund in any final version of the bill.

 

 

October 29, 2009

Washington, DC - Today, House Financial Services Committee Chairman Barney Frank (D-MA) released the following statement in response to the White House’s announcement regarding the National Affordable Housing Trust Fund. In October of 2007, the House of Representatives approved legislation to create the National Affordable Housing Trust Fund, which was created with the goal of producing, rehabilitating and preserving 1.5 million rental housing units over the next 10 years, but so far has yet to be funded.

“I appreciate the Obama Administration’s strong support of two important housing related items that are in the jurisdiction of the Financial Services Committee. The Trust Fund is essential both socially and economically. It will provide relief for low-income people who are unable to find decent affordable housing; and by funding rental housing, it will provide an alternative to pushing people into homeownership who cannot afford it. This combination of a lack of rental housing and an excessive emphasis on homeownership was a contributing factor to our current situation.

“The need for higher loan limits on a regional basis is simply a recognition that housing values are the most geographically variable segment of our economy. This will provide regional fairness, and necessary and appropriate support for homeownership.”