This week brought news that the two government housing giants, Fannie Mae and Freddie Mac, would begin contributing to a fund dedicated to affordable housing. As Bloomberg reports, this pot of money, known as the National Affordable Housing Trust Fund, has existed since Congress created it in 2008—but has lain empty ever since.
Federal Housing Finance Agency Director Mel Watt announced that the financial condition of Fannie and Freddie, which kept them from contributing, has improved. The decision to start contributing to the fund has been welcomed and panned by Democrat and Republican elected officials, respectively.
The National Affordable Housing Trust Fund is not the first such pool of funds, however. Here at CHPC we dug into our archives to find primary documents related to the planning of New York State’s own Housing Development Fund. Administered by the state’s Division of Housing and Community Renewal (DHCR), the Housing Development Fund was established in 1966. As this 1967 press release outlines, the Fund is “the State’s [then-] $10,000,000 loan program to provide ‘seed money’ to non-profit organizations interested in developing housing for low-income families.”
By 1968, however, there was unrest among the housing community about the use of the Fund. Also in our archives we found a string of correspondence between CHPC and other interested civic groups, debating how to bring their concern to the attention of then Governor Nelson Rockefeller and his housing administrators. These groups reached out to and subsequently met with James Gaynor, head of DHCR, to the dissatisfaction of those concerned.
This letter to the governor was the culmination of much deliberation between allies around New York City through late 1967. It states, “In view of the universally recognized, continuing need for low-rent housing, the well-nigh complete failure to extend financial and technical assistance to groups which the law intended to help would indicate that something is amiss.” The letter’s signatories felt that the effect of DHCR’s mismanagement were the constriction of the program to nonprofits “who can demonstrate by actual performance that they did not need it in the first place.”
The letter continues by quoting Rockefeller himself at the signing of the bill establishing the Fund: “The development loans provided under the bill will serve as ‘seed money,’ and thus make it financially possible for non-profit educational, charitable, and religious sponsors to devote their abilities and energies to the provision of low-cost housing for persons of low income.” Eventually, the pressure CHPC and its partners placed on DHCR led to the amelioration of the problems at the root of CHPC’s concern.