Jim King is CEO of the Federation of Appalachian Housing Enterprises, Inc., (FAHE) a network of organizations delivering housing to one of the nation's neediest regions.

The Berea, Ky.-based group is the largest provider of community investment capital in central Appalachia. In 2008, FAHE provided $41 million in direct financing, and its members produced 3,800 housing units.

FAHE was recently recognized with a Wachovia NEXT Award for Opportunity Finance, which came with a $2.75 million loan and grant. The program, which is run by the Opportunity Finance Network with support from the Wachovia Foundation and the John D. and Catherine T. MacArthur Foundation, recognizes excellence in the community development financial institutions fund field and aims to help organizations reach the next level of growth.

Q: How did you get started in affordable housing?

A: Coming to work at FAHE was my first job in the field. Initially, I was FAHE's CFO, then I left to work for a community development consulting firm here in Berea for five years, which gave me exposure to the local challenges in central Appalachia. I returned to FAHE in 2002 to become the president and CEO.

Q: Where did you work before FAHE?

A: After college, I worked for a handful of regional and national banks in Ohio and Pennsylvania.

Q: Share with us a statistic or fact about affordable housing in Appalachia.

A: 100,000 families in the region live in substandard housing that is overcrowded or lacking essentials like electricity and plumbing. Another 650,000 are cost-burdened because the real incomes are so low.

Q: What's been FAHE's most successful program?

A: Our mortgage division, JustChoice Lending, has ramped up its lending volume sevenfold over the past five years. More important, those loans are performing over the long term. Our delinquency rate is consistently under 2 percent, without raising foreclosures above 1 percent, which is phenomenal in today's economy. JustChoice Lending is a certified as a “fair and safe lender,” so families and investors know they are getting a good deal.

Q: What issue is keeping you up at night?

A: Housing is a basic human need—right up there with food and clothing—yet, we lack a comprehensive national housing policy in this country. We have a drug policy, energy policy, trade policy, and so on. But housing gets tacked on as an afterthought to the end of a dozen other policy initiatives.

That keeps me up at night because I have an outstanding network of members right behind me that do amazing work. If we had a unified policy, they could get so much more accomplished because their resources weren't bogged down in layering incompatible programs, conflicting reporting requirements, and funding cycles that reward the flavor of the day, not consistent performance.

Right now, we are debating whether health care is a right or a privilege. I think we need to have a similar conversation that looks at housing as a moral issue, not a financial one. Because it's THAT important.

Q: Will you be assembling another low-income housing tax credit fund? If so, how large will it to be and what's been your strategy for these funds?

A: We closed our second fund, another statewide fund in Kentucky, at around $10 million in December 2009. To make this happen, we have focused our strategy on smaller banks. In 2010, we will turn our attention to a third fund and expansion into Tennessee.

Q: Congratulations on the Wachovia NEXT Award. What does FAHE have planned for the prize money?

A: The economic downturn impacted all of our lines of business in some ways, but the low-income housing tax credit investments became exceptionally difficult. We will use the NEXT Award prize to bridge investments into the funds, raising the internal rate of return from 9 percent to around 12 percent.

Q: How has FAHE's role changed over the years?

A: FAHE started as an advocacy group that helped to provide job training for low-income families in affordable housing construction. By the time I joined the team in the ”˜90s, lending had become a part of our portfolio. We reached a plateau of $7 million of annual direct investment, reaching about 2,000 families a year. With so many people in need, that was insufficient. In five years, we made the leap to $41 million direct investment and 4,000 families served annually.

Q: Are you more optimistic or pessimistic about the state of affordable housing than you were a year ago and why?

A: I truly believe that this is the moment where our industry goes from being niche players to legitimate leaders in the next evolution of our financial system. I'm not making light of the fact that times are hard for a lot of our peers. But we are the best hope for reviving the economic vitality for millions of families. I can't help but be inspired by that.

Q: Who's your favorite fictional hero?

A: MacGyver, because he can make something out of nothing.

Q: What's your most treasured possession?

A: The most treasured things in my life are all things that I can't own—friends and family.

Q: Favorite book?

A: I really don't read enough these days, though I always have a copy of the Harvard Business Review with me at the airport. I'm also a fan of Jim Collins, especially Built to Last, though I haven't read his newest book. The only fiction I've read and re-read is Lord of the Rings.

Q: Besides the usual work papers, what's on your desk or in your office?

A: Clippings of Dilbert comic strips and my collection of PEZ dispensers.

Q: What do you do like to do when you're not working?

A: I have four children under the age of 18, so if I'm not working, I'm playing whatever they're into. I'm a seasoned Nerf warrior.

Q: What's next for Jim King and FAHE?

A: We're going to [expand to] $100 million of annual direct investment to serve 8,000 families each year by 2015.