The House took an important step toward easing the affordable housing crisis when it passed a bill that establishes a National Housing Trust Fund. A companion bill, which is expected to be introduced in the Senate soon, deserves to pass speedily into law.
The trust fund comes at a time when nearly half of the country’s lowest-income families are at risk of homelessness. These families often live doubled up with friends or relatives and must spend more than half of their pretax incomes on rent. They house themselves only by cutting back on food, clothing and medical care.
Modeled on systems long employed by the states, the trust fund would be used to construct, rehabilitate and preserve 1.5 million units of housing over the next 10 years. Three-quarters of the money would be directed at extremely low-income families.
The funds would be distributed to local jurisdictions that would award grants to entities that build and rehabilitate housing.
The developing parties who receive the money would be required to set aside a proportionate number of units for low-income families. The idea is to create vibrant, mixed-income communities – instead of segregating the poor in isolated developments, as was often done in the past.
The fund would require no new taxes. It would run on contributions made by the government-backed mortgage giants, Fannie Mae and Freddie Mac, and with money generated by the Federal Housing Administration, which insures mortgages.
The trust fund bill passed with broad, bipartisan support in the House and deserves the same kind of support in the Senate.