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Policy Update 5-18-22

Federal Updates

Housing Supply Action Plan Released by White House
The Biden Administration released a Housing Supply Action Plan this week, with the ambitious goal of closing the nation’s supply gap in 5 years. The plan represents the most comprehensive government effort to address housing supply in history. While the bulk of the focus is on administrative actions, President Biden is calling on Congress to enact critical legislative actions as well. 

The Administration’s plan lays a framework for creating and preserving hundreds of thousands of affordable units, while also prioritizing rental assistance and down-payment assistance. Details and a further breakdown on the administrative actions laid out in the plan can be found in the Coalition’s analysis here

In addition, the President continues to urge Congress to pass the housing investments that were included in Build Back Better and his FY23 budget proposal, as well as the expansion of LIHTC and inclusion of the Neighborhood Homes Investment Act.  

LIFELINE Act Introduced in the Senate
A Senate version of the LIFELINE Act (S.4181) was introduced last week by Senators Patrick Leahy (D-VT) and Susan Collins (R-ME). This is the companion bill to bipartisan legislation that was introduced in the House by North Carolina Representatives Alma Adams and David Rouzer (H.R. 7078). The bill seeks to address barriers limiting the use of State and Local Fiscal Recovery Funds (SLFRF) for LIHTC, which is the federal fix housing organizations have been working towards. 

The Senate version of the LIFELINE Act has 10 co-sponsors and would benefit from additional sign ons. If you have a relationship with Senator Burr or Senator Tillis’s office, this is a great opportunity to reach out and ask for their support of this bill. As of last week, the House version had several new sponsors from both sides of the aisle. 

While progress on the LIFELINE Act is hopeful, it will need to be attached to a larger legislative vehicle in order to advance. 

Updates to the Community Reinvestment Act Proposed by Federal Agencies
Three federal agencies (the Federal Reserve Board, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency) are jointly proposing revisions to strengthen and modernize the Community Reinvestment Act (CRA). The CRA was enacted in 1977 and encourages banks to help meet the credit needs of the entire community in which they do business, with a particular focus on low- and moderate- income communities. The last significant revision to CRA regulations was in 1995. 

The joint proposal has five key elements

  • Expand access to credit, investment, and basic banking services in low- and moderate-income communities
  • Adapt to changes in the banking industry, including internet and mobile banking
  • Provide greater clarity, consistency, and transparency
  • Tailor CRA evaluations and data collection to bank size and type
  • Maintain a unified approach

A public comment period on the proposal is open through August 5, 2022. Comments can be submitted here via the Federal Reserve’s website

North Carolina Updates

Governor’s FY23 Budget Released
Governor Cooper released his proposed budget last week, which includes the largest request for housing funding in recent years. In it, he proposes an additional $20M for the NC Housing Trust Fund (a total of $27.7M), which would be a historic level of funding if enacted. 

The Governor is also requesting $40M to the Workforce Housing Loan Program, which would fund the current cycle. However, this amount may fall short if the LIFELINE Act fails to pass at the federal level. If that happens, North Carolina will need to designate an additional $50-60M for the Workforce Housing Loan Program (WHLP) to activate funds that were previously allocated from State and Local Fiscal Recovery Funds.

There is also a new, notable line item included this year that calls for $50M in down payment assistance for first-time homebuyers. Enhanced assistance would be available for educators, law enforcement, firefighters and EMS personnel.

Other proposed allocations include:

  • $20M for Low-and-Moderate Income Area Water Infrastructure
  • $25M LIHEAP State Supplement
  • $10M LIHWAP State Supplement
  • $12.3M Transition to Community Living 
  • $4.2M Key Rental Assistance

It is important to note that the Governor’s budget is a recommendation and not a policy document. While the funding levels in the Governor’s proposal rarely make it into the final budget, it is significant for affordable housing to receive such priority in his request. 

Challenges Faced by NC Homeowners in Hurricane Recovery
Since Hurricane Matthew hit eastern North Carolina in October 2016, the state received $236 million in federal disaster relief money to rebuild or renovate damaged homes. At least 1,780 of the damaged houses identified belong to households with low- and moderate-incomes. However, only 717 houses have been repaired and 169 are in progress. Homeowners are staying in motels or with relatives, in dilapidated houses or in travel trailers while they wait.

Legislative decisions made in 2013 and 2014 gutted statewide infrastructure that was set up to respond to disasters. These decisions had profound ripple effects on the state’s ability to deploy disaster recovery funds in a timely way and meet the incredible needs of those impacted by Hurricanes Matthew and Florence. The current state of disaster recovery in Eastern NC is completely unacceptable and is a predictable result of the policy decisions that were made. Numerous agencies are now in conversation about our statewide housing infrastructure needs and these disaster recovery challenges illustrate the importance of public policy and its effects on the ground in our communities.

Local Updates

Housing Bond Planned for Fayetteville Ballot
The Fayetteville City Council voted to add an affordable housing bond to the election ballot in November. The bond is part of a three-part package that also includes proposed funding for public safety and infrastructure. The bond package can have a maximum total amount of $97 million ($60M for public safety, $25M for infrastructure and $12M for affordable housing). However, the Council could choose to propose less in any or all categories.

Rate of Homelessness Increased in Asheville
Asheville’s Point In Time Count data shows a 21% increase in homelessness since 2021. The City is contracting with the National Alliance to End Homelessness to address the issue.

Fisher Road Housing Development Plan Withdrawn in Brevard
Plans for a proposed 72-unit affordable housing development off Fisher Road were withdrawn by the developer who had requested a rezoning for the property. The developer confirmed he will not move forward with the project, citing decreased funding, increasing development costs and increasing mortgage financing costs. The project faced opposition from neighbors when the rezoning was announced, raising typical concerns about density, traffic and stormwater.

Reports, Resources and Events

Harvard Joint Center for Housing Studies – Virtual event: Improving America’s Housing Finance System 5/24 @ 5 pm

Urban Institute – 

NLIHC – Policy Brief: Extending the Reach of Emergency Rental Assistance: Leveraging Federal Resources

The Guardian – Revealed: 93% of districts in major US cities unaffordable to Black residents

CityLab – Why Did U.S. Cities Resegregate?

The Atlantic – Four Years Among the NIMBYs

Bloomberg – What Does Affordable Housing Do to Nearby Property Values?

Fortune – These Employers are Helping Workers Achieve their Dreams of Homeownership

Associated Press – US mortgage rates rise; 30-year at 5.27%, highest since 2009

NC Budget & Tax Center – Here’s what it takes to make ends meet in your NC county

News & Observer –

Charlotte Observer – 

WCNC – A Charlotte HOA wanted to limit a corporate landlord’s grip on its neighborhood. They wound up in court

CBS 17 – Median home sale price climbs to nearly $500000 in Chatham County amid economic boom

Recommended read

Governor Cooper Releases Proposed FY 2022-23 Budget

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