Multifamily Markup - 12/16/2016 (Plain Text Version)
FHFA Issues 2017 GSE Scorecard and Common Securitization Platform
FHFA issued the 2017 Scorecard for Fannie Mae and Freddie Mac (GSEs) on Friday, December 16, 2016. The scorecard will be used as a tool by the GSEs to guide and provide a framework for their efforts and results throughout the coming year. As previously highlighted, the scorecard includes a production cap for 2017 that remains the same as 2016 at $36.5 billion. However, this year’s scorecard includes provisions for the GSEs to research and analyze ways to more effectively serve a number of key areas in the multifamily market - many of which were previously defined in the recently issued Duty to Serve Underserved Markets guidelines from the Federal Housing Finance Agency (FHFA), including: workforce housing, affordability in high-cost and very-high cost areas, targeted affordable housing, small multifamily properties, manufactured housing rental community blanket loans, senior housing, rural housing and energy efficiency.
Dr. Ben Carson Tapped for HUD Secretary
Amidst a flurry of nominations to secretary posts in recent weeks, President-Elect Donald Trump submitted Dr. Ben Carson’s name to head the Department of Housing and Urban Development in the new administration. A loyal surrogate and confidant to Trump after withdrawing from the Presidential primary race earlier this year, it was widely speculated he would be offered the top job at the Department of Health and Human Services or another role more in keeping with his professional experience as a physician. However, the emphasis Trump placed on restoring American urban centers during the campaign, especially in places like Michigan, Illinois and Ohio, pairs well with Carson’s upbringing in inner city Detroit. The growing consensus within policymaker and academic circles about the nexus between housing and health also presents an opportunity for Dr. Carson. He will be subject to the same Senate confirmation hearing procedure as other cabinet level secretaries, expected to take place early in the new year. [return to top]
The holiday season is a time when families and friends get together to give thanks, celebrate our blessings and reconnect. For all of us at NMHC, we are thankful for the opportunity to serve such a special industry; we are blessed to have such wonderful members; and we are so very much looking forward to reconnecting with you all again in the New Year for the back-to-back annual Apartment Strategies Conference and Annual Meeting in San Diego (Jan. 24-26). In the spirit of thanks and giving back, there are a few changes to our January meetings to which I'd like to bring your attention. [return to top]
On December 5, NMHC/NAA joined nearly 380 other trade associations and business groups from across the country in urging Speaker Paul Ryan to make consideration of the “Regulatory Accountability Act” an early priority for the new Congress in 2017. The legislation, if enacted, would improve the transparency of executive branch regulations by requiring federal agencies to invest more effort earlier in the rulemaking process to gather data, evaluate alternatives, and receive public input about the costs and benefits of its rules. [return to top]
On December 13, NMHC/NAA and a coalition of real estate organizations sent a letter to House Speaker Paul Ryan (R-WI) and House Ways and Means Chairman Kevin Brady (R-TX) identifying the sector's key principles for tax reform. The letter comes as Ways and Means Committee members meet to discuss their blueprint for tax reform that could see action in the early part of next year. [return to top]
As the incoming Trump Administration takes shape, there appears to be significant potential for changes to current fair housing policies. The Obama Administration has aggressively pursued increases in fair housing protections and enforcement practices, including the expanded use of disparate impact theory, limitations on criminal screening and resident-friendly reasonable accommodation recommendations. However, the President-elect has not signaled a continuation of these priorities. [return to top]
The San Francisco Board of Supervisors unanimously approved an ordinance on December 13, 2016, that could significantly affect an apartment firm’s ability to manage communications services for their communities. Specifically, the ordinance creates a right for residents to request service from any city-authorized internet provider regardless of whether, or how many, providers already serve the property. The ordinance, which covers both apartments and commercial office buildings, is expected to be signed into law by Mayor Ed Lee and take effect in January. [return to top]
NATIONAL FLOOD INSURANCE PROGRAM
Housing and Insurance Subcommittee Chairman Blaine Leutkemeyer has released long-awaited draft principles outlining a path forward to reauthorizing the National Flood Insurance Program (NFIP) before it expires in September 2017. The document provides a framework that will ensure market certainty for the real estate community, while lessening taxpayer exposure and liability via mandatory use of reinsurance and risk transfer. Several of the key principles have the potential to drive down costs for apartment firms that mitigate risk. [return to top]
Congressional tax writers introduced bicameral technical corrections legislation on December 6 that would clarify tax provisions enacted in a 2015 bill related to partnership audits and foreign pension funds investing in U.S. real estate. The corrections would give the Internal Revenue Service (IRS) additional flexibility in implementing the new audit regime. Given the large number of partnerships in the apartment industry, these revisions may have a significant impact. [return to top]
Federal regulators are considering an extension of the Basel III regulations known as Basel IV. The Basel accords are a global, regulatory framework on bank capital adequacy, stress testing and market liquidity risk agreed to in the wake of the 2007-2008 financial crisis. [return to top]
MILITARY RESIDENTS AND HOUSING PROTECTIONS
Congress passed the long-stalled 2017 National Defense Authorization Act (NDAA) on December 8, 2016, after reaching agreement on several contentious provisions, including proposed cuts to military housing benefits. The final package eliminated provisions opposed by NMHC/NAA that would have increased out-of-pocket housing expenses for some service members and negatively impacted apartment communities that serve the military. [return to top]
RATING AND BENCHMARKING SYSTEMS
NMHC/NAA issued a comment letter on December 5, 2016, opposing a proposed rule that would require every building backed by a Federal Housing Administration (FHA) multifamily loan to track and submit energy benchmarking data through EPA’s ENERGYSTAR Portfolio Manager. While NMHC/NAA support methods to improve the operational efficiency of the apartment industry, including voluntary benchmark building performance, we oppose FHA’s efforts to mandate benchmarking across their entire portfolio. [return to top]
GSEs AND HOUSING FINANCE REFORM
The Federal Housing Finance Agency (FHFA) today issued a final rule to implement the Duty to Serve provisions mandated by the Federal Housing Enterprises Financial Safety and Soundness Act of 1992, as amended by the Housing and Economic Recovery Act of 2008. The statute requires Fannie Mae and Freddie Mac (the Enterprises) to serve three specified underserved markets – manufactured housing, affordable housing preservation, and rural housing – by improving the distribution and availability of mortgage financing in a safe and sound manner for residential properties that serve very low-, low-, and moderate-income families in these markets. [return to top]
The Federal Trade Commission (FTC) has updated several of their guidance documents that help apartment firms understand how to use credit and background screenings to manage properties, operations and workforce without violating federal law. [return to top]
The National Multifamily Housing Council (NMHC) and National Apartment Association (NAA) issued the following statement to congratulate Dr. Ben Carson on his nomination to serve as Secretary of the Department of Housing and Urban Development (HUD):
"NMHC and NAA congratulate Dr. Carson on his selection as HUD Secretary. As the voice of an industry that contributes $1.3 trillion annually to the economy, represents more than 12 million jobs and the 39 million who live in apartment homes, NMHC and NAA are looking forward to working with President-elect Donald Trump and his nominee for Secretary of HUD."[return to top]
Our multifamily community came together this year and exceeded the 2016 NMHC PAC fundraising goal of $1.5 million! And, since the PAC operates on a calendar year, members continue to show their support. [return to top]
During Congress' lame duck session there have been no relevant committee hearings listed.
Wall Street Journal
Who Picks the Capitol Christmas Tree?
Who Picks the Capitol Christmas Tree?
Ever wonder how the Capitol Christmas tree is chosen? Well, it’s not a short process. This year, it began in July when Capitol Grounds Superintendent Ted Bechtol traveled to the Payette National Forest in Idaho to select the perfect Christmas tree for the Capitol building’s front lawn. There, he chose an 80-foot Engelmann spruce from among a dozen candidates nominated by forest rangers.
Each year the tree is selected from one of the country’s national forests. Last year, for instance, the tree traveled a record-breaking 3,411 miles from Alaska, while the 2004 tree was trucked a measly 200 miles from central Virginia.