The Senate Banking Committee today unanimously voted to advance bipartisan legislation to boost housing supply by removing regulatory barriers and creating incentives for communities that build more homes. Ahead of the hearing, the American Bankers Association submitted comments in support of several provisions in the bill.
The ROAD to Housing Act, sponsored by committee Chairman Tim Scott (R-S.C.) and Ranking Member Elizabeth Warren (D-Mass.), incorporates legislation from members across the committee. The bill included language to reward communities that build more housing supply, ease environmental review of new construction, rethink regulations to hamper additional lending for small-dollar mortgages, and expand tenant assistance and protections.
In a letter to committee leaders, ABA listed several provisions that it supports. They include:
- Reforms to increase the effectiveness of the Department of Housing and Urban Development’s housing counseling and financial literacy programs. They include the creation of a portfolio-based funding mechanism that compensates housing counseling agencies based on the measurable value they deliver to stakeholders across the housing finance ecosystem.
- Language giving the HUD secretary added weight to applicants for competitive HUD grants that are located in, or primarily serve, designated Opportunity Zones to support housing preservation and construction.
- Language to increase the Public Welfare Investment cap for the Office of the Comptroller of the Currency and the Federal Reserve from 15% to 20%. The provision will make it easier for banks to make critical investments, including for Community Reinvestment Act purposes, in affordable housing, financial education and other community needs, ABA said. However, ABA noted that the Fed will still require prior approval by its board before making certain public welfare investments, so the association encouraged the Fed to update its regulatory approach to the issue.
- A provision to require the Consumer Financial Protection Bureau to assess the impact of mortgage loan officer compensation restrictions on consumers, “an analysis that will lead to much-needed improvements to the mortgage loan officer compensation regulation and expand credit options for borrowers seeking small-dollar loans,” ABA said. The bill also would direct the CFPB to evaluate the impact of points and fees restrictions for qualified mortgage loans.
- Language to boost the residential appraiser workforce, particularly in regions of the country challenged by overly rigid experience requirements and other restrictions. “These commonsense measures would improve recruitment and retention of appraisers throughout the country and create a more robust and sustainable appraisal workforce, ensuring timely and accurate property valuations,” ABA said.
