Fannie Mae-No Politics (FNMA)

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For anybody wanting to see a copy of the letter, see below:

Press Release of U.S. Senator Barbara Boxer
http://www.boxer.senate.gov/en/press/releases/012414.cfm

For Immediate Release: January 24, 2014

Reed, Boxer, Warren, Sanders, Colleagues Urge FHFA Director Watt to Revive the Housing Trust Fund and the Capital Magnet Fund

With Fannie Mae and Freddie Mac Now Generating Profits, Money Should be Allocated to Funds Created to Support Affordable Rental Housing Projects
Washington, D.C. – Today, U.S. Senators Jack Reed (D-RI), Barbara Boxer (D-CA), Elizabeth Warren (D-MA), Bernie Sanders (I-VT) and 29 colleagues sent a letter to Federal Housing Finance Agency (FHFA) Director Mel Watt, urging him to help support affordable housing projects across the country by allowing the allocation of funds to the National Housing Trust Fund (NHTF) and the Capital Magnet Fund (CMF). The funds were created to support affordable housing for low-income families, but neither has been funded in five years.

“Since passage of the Housing and Economic Recovery Act in 2008, the number of homes that are affordable to renters with incomes at or below 30 percent of area median income decreased by more than 1 million units,” the Senators wrote. “… Funding the NHTF and CMF would help ameliorate this crisis.”

The Housing Trust and Capital Magnet Funds were designed to send grants to states and nonprofits primarily for affordable rental housing projects. In 2008, however, the FHFA suspended allocations to both funds when Fannie Mae and Freddie Mac were placed in conservatorship. Fannie and Freddie have both since begun generating profits, and now have paid more than $185 billion in dividends to the U.S. Treasury. In light of these profits and the dramatically improved financial conditions of both Enterprises, the withholding of these resources to support affordable housing can no longer be justified.

The Senators wrote, “The time is long overdue to lift the current suspension of contributions to the NHTF and CMF, and we ask your full and fair consideration of our request.”

The full text of the letter follows:

January 24, 2014

The Honorable Mel Watt
Director
Federal Housing Finance Agency (FHFA)
400 7th Street, SW
Washington, DC 20024

Dear Director Watt:

We write first to congratulate you on being confirmed and sworn in as Director of the Federal Housing Finance Agency (FHFA). We also share your concern about the need for more affordable rental housing in this country and ask that you end the suspension of contributions to the National Housing Trust Fund (NHTF) and the Capital Magnet Fund (CMF), in a manner fully consistent with all applicable laws, rules, and regulations.

The affordable rental housing crisis that prompted Congress, on a bipartisan basis, to create the NHTF and CMF has only gotten worse in the last five years. Since passage of the Housing and Economic Recovery Act in 2008, the number of homes that are affordable to renters with incomes at or below 30 percent of area median income decreased by more than 1 million units. According to the Harvard Joint Center for Housing Studies, there is currently a national shortage of nearly 5 million units affordable and available to extremely low-income renters. Funding the NHTF and CMF would help ameliorate this crisis.

We are all committed to reforming the mortgage finance system and do not believe Fannie Mae and Freddie Mac should be returned to their previous form. However, directing much needed funding for affordable rental housing should not wait until Congress and the President are able to agree on a new system. The time is long overdue to lift the current suspension of contributions to the NHTF and CMF, and we ask your full and fair consideration of our request.

We look forward to hearing from you in a timely fashion and working with you as FHFA Director on this and other important matters.

Sincerely,

Jack Reed
United States Senator

Barbara Boxer
United States Senator

Elizabeth Warren
United States Senator

et al.