Senator Warren Introduces New Housing ProposalOctober 4th, 2018 by Drew Vass
Senator Elizabeth Warren recently tabled a proposal aimed at addressing the issue of housing affordability. According to the National Lumber and Building Material Dealers Association (NLBMDA), The American Housing and Economic Mobility Act provides $470 billion for affordable housing trust funds and expands the types of financial institutions subject to Community Reinvestment Act (CRA) requirements. This would be made possible by reducing estate tax exemptions and adding additional surtax on estates valued at more than $1 billion.
There is already a call to reform CRA, which applies to Federal Department Insurance Corporation (FDIC) insured banks. Under this new proposal, all credit unions and mortgage lenders would have to follow CRA requirements.
The Office of the Comptroller of the Currency (OCC) issued a proposal in August, asking for suggestions on CRA reforms.
The following investments aim to address affordable housing challenges:
- $445 billion in the Housing Trust Fund to build, rehabilitate and operate up to 2.1 million homes for low-income families;
- $25 billion in the Capital Magnet Fund that would be leveraged 10:1 with private capital, to build more than 835,000 new homes;
- $4 billion for a new Middle-Class Housing Emergency Fund to support construction of homes for middle-class buyers and renters;
- $523 million in rural housing programs to create 380,000 rentals and help 17,000 families buy homes; and,
- $2 billion for the Indian Housing Block Grant to build or rehabilitate 200,000 homes on tribal land.
“NLBMDA appreciates the effort by Sen. Warren to highlight the issue of housing affordability,” says NLBMDA president and CEO Jonathan Paine. “However, NLBMDA disagrees with Sen. Warren financing her proposal by reducing the estate tax exemption.”
NLBMDA officials say the association supports affordable housing programs that, “make the dream of home ownership available to more Americans,” while opposing changes to estate tax laws that make it harder for family-owned businesses to transition to next generations.