One of the Federal Home Loan Bank’s (FHLB) flagship programs – the Affordable Housing Program (AHP) – will soon be changing if new proposed rules are adopted. The AHP, as it currently stands, is a flexible pool of funds generated from 10% net earnings from each FHLBank. PCRG’s members are likely familiar with the First Front Door program, a grant of up to $5,000 to cover down payment or closing costs for low- to moderate income homebuyers, but that is just one of several ways that AHP works to keep housing affordable in our region. AHP is also used by local nonprofits to rehabilitate the houses of low-income homeowners and provide additional financing for the development of affordable multifamily units.
In March, a series of proposed rule changes were released that could fundamentally alter how the money is disbursed. As it stands, the FHLB uses as straightforward 100-point scoring method to award funds to their applicants. Although there are flaws with this system, it is transparent and responsive to local needs. What is being proposed instead relies mon a more prescriptive, national-level policy agenda that gets rid of the point system and instead obligates district FHLB branches to awards funds based on the certain categories prioritized by federal regulators.
Earlier this month PCRG, along with several other members, sent in comments to the Federal Housing Finance Agency (FHFA) in Washington D.C. outlining our concerns with the proposed changes. At its core, we believe the changes will slow down the creation and preservation of affordable housing. More specifically, we see flaws in the following areas:
Although the comment period has closed, we encourage all of you who rely on the AHP program to continue to reach out to the FHFA. If you would like more information about AHP and the proposed rule changes, please contact me at firstname.lastname@example.org.