[Congressional Record Volume 153, Number 195 (Wednesday, December 19, 2007)]
[Senate]
[Pages S16010-S16015]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. KERRY (for himself, Ms. Snowe, Mr. Sanders, Mr. Domenici, 
        Mr. Schumer, Ms. Collins, Mr. Kennedy, and Mr. Reed):
  S. 2523. A bill to establish the National Affordable Housing Trust 
Fund in the Treasury of the United States to provide for the 
construction, rehabilitation, and preservation of decent, safe, and 
affordable housing for low-income families; to the Committee on 
Banking, Housing, and Urban Affairs.
  Mr. KERRY. Mr. President, while we are facing new difficulties in the 
mortgage and subprime markets, we cannot forget the ongoing and 
deepening crisis that affordable rental housing presents for our 
Nation. Long-term changes in the housing market have dramatically 
limited the availability of affordable rental housing across the 
country and have severely increased the cost of rental housing that 
remains. As a result, more and more families are forced to pay more 
than 50 percent of their income for housing. In 2005, a record 37.3 
million households paid more than 30 percent of their income on housing 
costs, according to the Nation's Housing 2007 Report from the Joint 
Center

[[Page S16015]]

for Housing Studies at Harvard University. Approximately 17 million 
families paid more than half of their incomes on housing costs. This is 
unacceptable. Our Nation must act to ease this rental housing crisis by 
producing more affordable housing options.
  We can no longer ignore the lack of affordable housing and the impact 
it is having on families and children around the country. I believe it 
is time for our Nation to take a new path--one that insures that all 
Americans, especially our poorest children, have the opportunity to 
live in decent and safe housing.
  Housing construction is a critical part of our economy. 
Unfortunately, just yesterday the Commerce Department reported that 
construction of new homes dropped by 5.5 percent last month, the lowest 
level since April 1991. The overall construction decline left home 
building 24.2 percent below the level of activity a year ago. 
Residential construction has seen the largest share of job losses, more 
than 192,000 since March 2006.
  The question is, what do we do today to face--and to finance--this 
mounting challenge?
  In September 2000, I wrote and introduced the original National 
Affordable Housing Trust Fund legislation. Today, along with Senator 
Snowe, I am again proposing to address the severe shortage of 
affordable housing by introducing legislation that will establish a 
National Affordable Housing Trust Fund and begin a rental housing 
production program.
  The Affordable Housing Trust Fund that is established in this 
legislation would create a production program that will ensure 1.5 
million new rental units are built over the next 10 years for extremely 
low-income families and working families. The goal is to create long-
term affordable, mixed-income developments in areas with the greatest 
opportunities for low-income families. Sixty percent of Trust Fund 
assistance will be awarded to participating local jurisdictions. Forty 
percent of Trust Fund assistance will be awarded to States, Indian 
Tribes and insular areas. A proportionate amount of funds to the States 
must go to rural areas. If the total amount available for the Trust 
Fund is less than $2 billion, then there is a $750,000 minimum funding 
threshold for local jurisdictions.
  All funding from the Trust Fund must be used for low-income families, 
defined as those families with incomes below 80 percent of the State or 
local median income. However, if the funding for the trust fund is less 
than $2 billion for any year, then the income ceiling is reduced to 60 
percent of local median income.
  The funding from the Trust Fund can be used for construction, 
rehabilitation, acquisition, preservation incentives, and operating 
assistance to ease the affordable housing crisis. Funds can also be 
used for downpayment and closing cost assistance by first time 
homebuyers.
  The Trust Fund will be funded through amounts transferred from the 
Federal National Mortgage Association and the Federal Home Loan 
Mortgage Corporation under Title XIII of the Housing and Community 
Development Act of 1992. It will also be funded through any amounts 
appropriated under the authorization in the Expanding American 
Homeownership Act of 2007, relating to the use of FHA savings for an 
affordable housing grant program. Finally, the Trust Fund will be 
funded through any amounts as are or may be appropriated, transferred 
or credited to such fund under any other provisions of law.

  The National Affordable Housing Trust Fund bill is cosponsored by a 
bipartisan group of Senators. Earlier this year, the House of 
Representatives passed legislation, introduced by House Financial 
Services Chairman Barney Frank, to establish a National Affordable 
Housing Trust Fund by a 264-148 vote. It has been endorsed by more than 
5,700 community organizations led by the National Low-Income Housing 
Coalition and including the National Association of Realtors, the 
National Association of Home Builders, Children's Defense Fund, U.S. 
Conference of Mayors, National Coalition for the Homeless, and others. 
I am pleased that Senator Reed, within the Government Sponsored 
Enterprise Mission Improvement Act, included legislative language 
within the Affordable Housing Block Grant section to provide grants to 
an Affordable Housing Trust Fund.
  Enacting the National Affordable Housing Trust Fund will help reverse 
the recent declines in housing jobs, starts, permits and construction 
in every State. It will help small businesses across the Nation 
continue to produce the jobs that are critical to our economic security 
today and in the future.
  During this time of rising rents, increased housing costs, and the 
loss of affordable housing units, it is incomprehensible that we are 
not doing more to increase the amount of housing assistance available 
to working families. The need for affordable housing is severe. Many 
working families have been unable to keep up with the increase in 
housing costs. In 2005, one in seven households was considered to be 
``severely housing cost burdened.''
  For too many low-income families and their children, the cost of 
privately owned rental housing is simply out of reach. Today, working 
families in this country increasingly find themselves unable to afford 
housing. According to the National Low-Income Housing Coalition, in 
Massachusetts, the fair market rent for a two-bedroom apartment is 
almost $1,200 per month. In order to afford this apartment without 
paying more than 30 percent of income on housing, a household must earn 
over $47,000 per year. This means teachers, janitors, social workers, 
police officers and other full-time workers are having trouble 
affording even a modest two-bedroom apartment.
  The cost of rental housing keeps going up. According to the Consumer 
Price Index, CPI, contract rents began to rise above the rate of 
inflation in 1997 and have continued every year since. Rental costs 
have outpaced renter income gains for households across the board. Low 
wage workers have been hardest hit by the increase in the cost of 
rental housing.
  Because of the lack of affordable housing, too many families are 
forced to live in substandard living conditions putting their children 
at risk. Children living in substandard housing are more likely to 
experience violence, hunger, lead poisoning and to suffer from 
infectious diseases such as asthma. They are more likely to have 
difficulties learning and more likely to fall behind in school. Our 
Nation's children depend upon access to affordable rental housing.
  At the same time the cost of rental housing has been increasing, 
there has been a significant decrease in the number of affordable 
rental housing units. According to Real Capital Analytics, the number 
of rentals in larger multifamily properties converted to for-sale units 
jumped from just a few thousand in 2003 to 235,000 in 2005. New 
construction of multifamily buildings intended for rental use dipped 
from 262,000 units in 2003 to 184,000 in 2006. Simultaneously, the 
number of renter households increased by 1.2 million. The decline in 
affordable rental units has already forced many working families 
eligible for Section 8 vouchers in Boston to live outside the city 
because there are no available rental housing units that accept 
vouchers.
  The loss of affordable housing has exacerbated the housing crisis in 
this country, and the Federal Government must take action. We need to 
enact the National Affordable Housing Trust Fund to jumpstart the 
production of affordable housing in the U.S.
  Decent housing, along with neighborhood and living environment, play 
enormous roles in shaping young lives. Federal housing assistance over 
the past generation has helped millions of low-income children across 
the Nation and has helped in developing stable home environments. 
However, changes in the housing market clearly show that we need to 
take additional steps to both produce and maintain affordable housing 
units. Otherwise, many more children and their families will live in 
substandard housing or will become homeless. These children are less 
likely to do well in school and less likely to be productive citizens. 
They deserve our best efforts and require our help.
  I ask all Senators to support the National Affordable Housing Trust 
Fund Act.
                                 ______