Home-Buying Trust Funds for Poor Called Big Success

The number of affordable-housing trust funds across the nation has more than quadrupled since 1990, evidence of how useful the funds have proved to be to communities struggling to provide housing for the poor, a housing advocacy group reported this week.

The Washington, D.C.-based Center for Community Change is trying to keep the trend alive--arguing that the federal government, states and cities should build special treasuries to subsidize housing.

A housing trust fund receives public funds from a dedicated source, money that can be tapped to construct and rehabilitate housing for low-income residents or to subsidize homeownership.

According to the report, the nation’s 282 city, county and state funds provide about $750 million each year to support low-income housing. In 2001, the nation’s trust funds supported 65,000 units of affordable housing.

The authors of the report and other housing advocates say the findings buttress their call for the federal government to establish a similar fund.

“This is truly a national housing crisis and it requires a truly national response,” said Jerry Jones, policy analyst for the Center for Community Change, a nonprofit that assists organizations working in low-income communities.

Like local funds, a national housing trust fund would supply a constant source of money not subject to annual budget battles. The idea has won support among some legislators, including Rep. Maxine Waters (D-Los Angeles), co-author of the National Affordable Housing Fund Act.

“We have an acute housing shortage, particularly of affordable housing,” Waters said.

The act, co-written by Rep. Bernard Sanders (I-Vt.), would have created a national fund using more than $26 billion in surplus funds generated by the Federal Housing Administration, but the proposal died in committee this month.

The House Financial Services Committee approved a compromise proposal that calls for federal matching grants for city, county and state trust funds.

Republican leaders and the Bush administration oppose the idea of dedicating a separate source of funds solely for affordable housing, but some legislators said they would consider the compromise to add money to local housing funds.

That would be at least a step toward more sustained funding, advocates said.

“[It’s] not everything we wanted, but it’s something we didn’t have a shot at a year ago,” said David Swanson of the Assn. of Community Organizations for Reform Now.

California has more housing trust funds than any other state, and Los Angeles has pledged to build the largest fund, at $100 million. Federal support would make that pot even larger, Swanson said.

Congress is expected to take up the issue in September.

At a rally Wednesday in Los Angeles, tenants stood outside a building owned by the federal Department of Housing and Urban Development and said federal funding is badly needed.

Rosa Miranda, who has lived in the dilapidated building on Grand Avenue for eight years, said tenants have put up with absentee owners, mold, leaks and other problems. “We’re asking that they approve a federal fund,” Miranda said, “for buildings like this.”