After a month long delay, the Federal Housing Finance Agency (FHFA) this week announced it is providing $244.86 million to the Housing Trust Fund (HTF) and $131.84 million to the Capital Magnet Fund (CMF). In January, U.S. Senator Jack Reed (D-RI) and Susan Collins (R-ME) sent a letter to FHFA Acting Director Joseph Otting calling on the agency to transfer the funds, as obligated by law. Senator Collins is Chair of the Senate Appropriations Subcommittee on Transportation, Housing, and Urban Development (THUD) and Senator Reed is the Ranking Member of the THUD Subcommittee.
The HTF is a block grant to states that is principally for the production, rehabilitation, preservation, and operation of rental housing for Extremely Low Income (ELI) households, those earning less than 30% of the Area Median Income (AMI) or income below the federal poverty line. Created through the Housing and Economic Recovery Act of 2008, the HTF and CMF were to receive dedicated revenue from an assessment on the new business of Fannie Mae and Freddie Mac (65% for HTF and 35% for CMF). After the market crashed in September 2008, Fannie and Freddie were placed into conservatorship overseen by the FHFA, which placed a temporary suspension on any assessments until 2014. States received the first HTF allocation in 2016.
In Massachusetts, the 2016 allocation helped fund seven projects, totaling 88 units. These units included housing specifically for homeless women, homeless veterans, and the elderly. This week CHAPA also hosted an event for the release of the Boston Federal Reserve’s report on the growing shortage of housing affordable and available to ELI households. According to the report, the state needs to build 4,000 subsidized units per year to 2035.
The CMF provides competitive grants to Community Development Financial Institutions (CDFIs) and nonprofit housing developers to finance and develop housing for low and moderate-income households, and other economic development activity that supports housing.