NAHB applauds passage of FHA multifamily credit subsidy bill

The Senate Appropriations Commit-tee's unanimous approval of a bill releasing $40 million in credit subsidy for FHA multifamily mortgage insurance drew praise from the National Associa-tion of Home Builders, according to an NAHB news release.

The organization called the bill "a step in the right direction for ensuring the creation of thousands of affordable apartments for low- and moderate-income Americans."

NAHB President Bruce Smith said that the FHA's multifamily mortgage insurance programs "are essential to helping the 13.7 million households with critical housing needs in this country. We are pleased that the Senate Appropriations Committee has taken action to get this initiative back on track after it ran out of credit subsidy earlier this year."

The Senate's fiscal year 2001 supplemental appropriations removes the emergency designation and other limitations from $40 million that Congress appropriated for the FHA multifamily credit subsidy last year.

"Most importantly, the Senate bill does not tie funding to an increase in mortgage insurance premiums the way that the House version does," Smith said. Such an increase would increase costs to developers and lead to higher rents on subsidized apartments.

Smith added, "Unfortunately, $40 million will not be enough to keep the program in business for the rest of the year. We strongly urge Congress to approve a total of $155 million in supplemental funding to ensure the continued creation of decent, affordable apartments for families with critical housing needs."