Proposal Would Set Aside $1 Billion a Year for Affordable Housing

WASHINGTON – Lawmakers and community activists unveiled plans yesterday for an Affordable Housing Trust Fund which would provide as much as $1 billion a year for affordable housing projects. However, the main source of funding, as much as $600 million a year to be set aside by Fannie Mae and Freddie Mac, is part of the ongoing legislative debate over reform of the secondary mortgage market. Rep. Barney Frank, chairman of the House Financial Services Committee and a chief sponsor of the Trust Fund bill, said he is confident the Senate will pass the bill, which has already been passed by the House. The Trust Fund would also be funded by rearranging certain federal housing programs. Rep. Maxine Waters, head of the Financial Services Subcommittee on Housing, said the first year’s funding would be devoted to building affordable housing in New Orleans and elsewhere in the Gulf Coast where residents are still rebuilding from the devastation caused by hurricanes Katrina and Rita.