House Panel Passes AH Fund

By a 45-23 vote, the House Financial Services Committee has approved a housing trust fund bill that could generate over $600 million in grants a year for the construction and rehabilitation of affordable housing for very-low-income families.The government-sponsored enterprises -- Fannie Mae and Freddie Mac -- and the Federal Housing Administration would provide the bulk of the trust funds. The House committee has approved separate bills that require the GSEs and the FHA to make annual contributions to the fund. The Department of Housing and Urban Development would be in charge of awarding and distributing the grants to the states, cities, and Indian reservations, which would have to put up some matching funds. The chairman of the House Financial Services Committee, Rep. Barney Frank, D-Mass., estimates that the trust fund could increase the stock of affordable housing by 1.5 million units before the legislation sunsets after 10 years. "The growing shortage of affordable housing is one of the most serious social and economic problems facing our country," Rep. Frank said.