More than 30 senators are urging Mel Watt, the new director of the Federal Housing Finance Agency (FHFA), to end the suspension of contributions to the National Housing Trust Fund and the Capital Magnet Fund.
“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,” says a Jan. 23 letter signed by the senators. “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.”
In 2008, overwhelming majorities in Congress passed the Housing and Economic Recovery Act to help stabilize America’s housing market. The legislation created the National Housing Trust Fund and the Capital Magnet Fund that sought to address the shortage of affordable rental housing.
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 government-sponsored enterprises, the withholding of these resources to support affordable housing can no longer be justified, says Sen. Barbara Boxer (D-Calif.), who signed the letter.
As the FHFA’s new director, Watt has the power to lift the suspension, say the senators.
Others signing the letters include Tammy Baldwin (D-Wis.), Richard Blumenthal (D-Conn.), Cory Booker (D-N.J.), Sherrod Brown (D-Ohio), Benjamin Cardin (D-Md.), Robert Casey Jr. (D-Pa.), Richard Durbin (D-Ill.), Dianne Feinstein (D-Calif.), Al Franken (D-Minn.), Kristen Gillibrand (D-N.Y.), Tom Harkin (D-Iowa), Mazie Hirono (D-Hawaii), Tim Kaine (D-Va.), Amy Klobuchar (D-Minn.), Mary Landrieu (D-La.), Patrick Leahy (D-Vt.), Carl Levin (D-Mich.), Ed Markey (D-Mass.), Robert Menendez (D-N.J.), Jeff Merkley (D-Ore.), Barbara Mikulski (D-Md.), Chris Murphy (D-Conn.), Patty Murray (D-Wash.), Jack Reed (D-R.I.), Bernard Sanders (I-Vt.), Brian Schatz (D-Hawaii), Charles Schumer (D-N.Y.), Jeanne Shaheen (D-N.H.), Debbie Stabenow (D-Mich.), Elizabeth Warren (D-Mass.), Sheldon Whitehouse (D-R.I.), and Ron Wyden (D-Ore.).