January 25, 2019
President and Congressional Leaders Reach Deal to End Partial Shutdown
A daily roundup of news impacting housing and communities. Not receiving the Community Developments daily email yet? Sign up here.
- Earlier this afternoon, President Trump announced a deal with Congressional leaders to reopen the government for three weeks to allow a bipartisan Congressional committee to develop a funding proposal for border security. The President stated that he will sign a short-term spending bill to reopen the government that does not include funds for the proposed border wall. (The Washington Post, January 25) The Hill reports that the Senate is expected to take up a three-week continuing resolution (CR) to end the partial shutdown later today. Senate Majority Leader Mitch McConnell (R-KY) said that with "cooperation" the Senate can pass the CR today. (The Hill, January 25) In a press conference, House Speaker Nancy Pelosi (D-CA) noted that she looks forward to working in a "bipartisan, bicameral way" to pass measures to reopen the government.
- Yesterday 16 members of Congress – seven Senators and nine Representatives, all of whom were among the co-sponsors of the Investing in Opportunity Act – sent a letter to Treasury Secretary Steven Mnuchin calling for additional clarity on aspects of the new Opportunity Zones tax incentive. This bipartisan letter urges the Administration to include “reasonable reporting requirements” in future regulations. The IRS released its first round of proposed rules on Opportunity Zones in October and Enterprise submitted comments last month, including an emphasis on the need for strong reporting requirements and publicly available data on investments in Opportunity Zones. The rulemaking process has been delayed due to the government shutdown, but the IRS is expected to release another round of proposed rules on Opportunity Zones in the near future.
- Politico reports that the White House is expected to announce a plan by next month to end government control of Fannie Mae and Freddie Mac (the government sponsored enterprises, or GSEs), which have been under the Federal Housing Finance Agency (FHFA) conservatorship since September 2008. In remarks to the FHFA’s employees, Joseph Otting, the agency’s acting director, said the Administration would not wait on Congress, where efforts to overhaul the housing finance system have failed over the past decade. Otting also explained that ending the conservatorship of the GSEs would require “thoughtful look” at the capital and liquidity levels they would need to operate independently, estimating that the capital required is in the range of $150 billion to $200 billion. (Politico, January 24) Enterprise has released recommendations for housing finance reform that would expand support for affordable single-family and rental housing.
- A group of tech leaders and philanthropists have pledged $500 million to create or preserve more than 8,000 homes in the Bay Area over the next decade. California Governor Gavin Newsom has urged the state’s tech corporations to match the $500 million he intends to allocate for middle-income housing. The partnership plans to invest $500 million in loans to build new housing and preserve existing units for households earning up to 150 percent of the area median income. More than $260 million has been raised so far, including $40 million from the Chan Zuckerberg Initiative, $5 million from Genentech and $1 million from the Silicon Valley Community Foundation. The partnership has also launched a separate fund of $40 million to help Bay Area cities and counties reshape their housing policies. Those funds could be used to help local officials craft ordinances that require landlords to show “just cause” before evicting a tenant, strengthen tenant protections, identify resources to finance affordable housing, or address regulatory barriers to development. (The Mercury News, January 24)
- Today is the Earned Income Tax Credit (EITC) Awareness Day, which is dedicated to promoting the tax break and making more eligible working families aware of its benefits. The EITC is a refundable federal income tax credit for low- to moderate-income workers intended to offset the burden of social security taxes. Last year more than 25 million eligible taxpayers received $63.8 billion in EITCs. The Office of the Comptroller of the Currency encourages national banks and federal savings associations to work in their communities to educate the public about and to promote the EITC and free tax assistance programs. Comptroller of the Currency Joseph M. Otting noted that “not only does this tax break help working families, it can also provide an economic boost to the communities that national banks and federal savings associations serve.” (OCC, January 25)
- The Virginia Beach City Council has received a draft of a comprehensive policy report that aims to address the challenges of sea level rise and recurrent flooding. The document, which estimates that an additional three feet of sea level rise annual could cost the city up to $271 million in damages, recommends a set of actions for increasing Virginia Beach’s resilience against this challenge. Those recommendations include issuing bonds to invest in resilience projects, increasing incentives to build in “Strategic Growth Areas” located away from the most flood-prone parts of the city, and creating guidelines for developers to assess flood risk. Although the costs associated with implementing all the recommendations in the draft report run into the billions, the report explains that the cost of intervention is much lower than the losses would be if the city were to do nothing. (Next City, January 25)
- On Friday, February 8, Energy Efficiency for All and the Environmental and Energy Study Institute will hold a briefing on “The Multiple Benefits of Federal Housing and Energy Programs.” This briefing, which will be held at 2 p.m. ET in Room 2168 of the Rayburn House Office Building, will discuss how energy efficiency services result in lower home energy bills, which is critical for low-income families that spend a greater percentage of their income on energy than higher-income households. The session features a group of experts, including Ellen Lurie Hoffman, federal policy director at the National Housing Trust, and Katrina Metzler, executive director of the National Energy and Utility Affordability Coalition. Register here for the event.
In Case You Missed It
- Earlier this week Enterprise launched Health Begins with Home, a $250 million, five-year national initiative to harness the power of affordable homes to create healthier families and stronger communities. Working with a broad group of partners and guided by data-driven insights, Health Begins with Home will promote health as a top priority in the development and preservation of affordable homes, particularly by creating cross-sector partnerships among health systems, health insurers, housing developers, policymakers, public health associations, community development organizations, social impact investors and foundations. The initiative will conduct research, award grants to housing and community development programs, provide technical assistance, and connect capital from healthcare organizations and others to support development and preservation of healthy, well-designed homes that are affordable. Health Begins with Homes’ work will include investments from the two funds Enterprise announced jointly with Kaiser Permanente last week.