Council of Federal Home Loan Banks Supports Streamlining AHP Application Process
June 20 2024 - 4:07PM
Ryan Donovan, President and Chief Executive Officer of the Council
of Federal Home Loan Banks, the public voice of the Federal Home
Loan Bank System (FHLBank System), today released the following
statement in response to the publication of the Federal Housing
Finance Agency’s Request for Input on Affordable Housing Program
(AHP) applications.
“We appreciate FHFA recognizing the feedback it heard from the
FHLBanks, their members, and affordable housing developers during
its review of the FHLBank System that the AHP application process
is overly complicated, and we welcome the opportunity to respond to
this Request for Input.
“Solving the affordable housing crisis is one of our greatest
societal challenges and while we recognize that no single entity or
group can alone solve the problem, the FHLBanks today are one of
the largest sources of private funding for affordable housing, down
payment assistance and community development in the country with an
expected $1 billion available in 2024.
“One of the biggest challenges facing community and affordable
housing groups desperately seeking funding is how best to navigate
the complexity of the AHP grant program application
process. The FHLBanks, along with our members who provide AHP
grants directly to consumers and housing providers, provide tools
and guidance to applicants to ensure compliance for their projects
and we fully support creating an easier path to for accessing AHP
funding. We hope this is the beginning of a process to meaningfully
streamline AHP regulations to enhance access use and, importantly,
the impact of the program.”
Additional information:
Each of the 11 FHLBanks have implemented programs designed to
broaden the AHP applicant pool, extending the reach of the program
into underserved and needy communities. Some examples
include:
- FHLBank San Francisco established the Nevada Targeted Fund, the
first program of its kind that specifically targets affordable
housing projects in the state. To ensure the widest pool of
applicants, the Bank granted $850,000 to the Nevada Housing
Coalition over two years to build the Coalition's capacity, expand
affordable housing development capabilities, and initiate
educational efforts to ease the application process.
- FHLBank Atlanta’s Multifamily Housing Bridge Fund awarded
$400,000 to Crescent Drive Apartments in Durham, North Carolina
through member Truist Bank. The grants will enable the completion
of a large, 82-unit complex specifically serving low- to
middle-income households: 18 units are for households earning up to
30% of AMI, 42 for those earning up to 60%, and 22 for those
earning up to 80%.
- FHLBank Chicago’s “Cultural Exploration” initiative provides an
avenue for it to meet with members in local communities and work
toward innovative solutions. One member, IAA Credit Union, attended
a “Cultural Exploration” event and left with a solution for a
customer who had been previously approved for down payment
assistance through FHLBank Chicago’s AHP, but was faced with
walking away from the purchase due to structural issues identified
late in the process. IAA Credit Union paired the AHP funding with a
USDA 504 loan program, which can be used to address hazardous
repair or modernization of a property, allowing the buyer to move
forward with the purchase.
Each FHLBank is required by law to contribute a minimum of 10%
of income to its Affordable Housing Program (AHP). Last year, the
11 FHLBanks voluntarily agreed to contribute a total of 15% of
income to affordable housing and community development initiatives
on a go forward basis. Each FHLBank is either already making
additional voluntary contributions or is in the process of
increasing its voluntary contribution levels. The FHLBank System
recently reported combined net income of over $6.6 billion for 2023
with a combined AHP assessment of $752 million. Including expected
voluntary contributions based on their 2023 financial results, the
FHLBanks expect to provide approximately $1 billion in support for
affordable housing and community development initiatives in
2024.
About: The FHLBanks are 11 regionally based,
wholesale suppliers of lendable funds to financial institutions of
all sizes and many types, including community banks, credit unions,
commercial and savings banks, insurance companies, and community
development financial institutions. The FHLBanks are cooperatively
owned by member financial institutions in all 50 states and U.S.
territories. The steady supply of lendable funds from FHLBanks
helps U.S. lenders invest in local needs including housing, jobs,
and economic growth. The Council of FHLBanks represents all 11
FHLBanks.
CONTACT INFORMATIONCouncil of FHLBanksPeter E.
Garuccio202-955-0002 ext. 14pgaruccio@cfhlb.org