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Affordable Housing Advisory Council
2015 Annual Report


The difference between what lower-income and upper-income families and individuals spend on housing makes the concept of a wealth gap anything but abstract. With a population of renters that has grown significantly since the Great Recession, the growing disparity in the wealth of richer and poorer American households is being driven to a great degree by ever higher housing costs.

In 1960, less than a quarter of all renting households in the United States spent 30 percent or more of their monthly income on rent. Today, upper-income renters spend only about 15 percent of their income on rent, while lower-income households are devoting nearly half their income to housing, reports The Pew Charitable Trust

And the lower down the income ladder you go, the worse it gets. As the National Housing Conference’s Housing Landscape 2016 reports, one out of five low- to moderate-income households is spending over half their income on housing, while nearly four out of five extremely low-income households are severely burdened by rising housing costs. According to the National Low Income Housing Coalition’s Affordable Housing Gap Analysis, the absolute shortage of affordable housing units for the poorest is unprecedented throughout the country, and especially in our district: Nevada had the least adequate supply, with only 17 affordable and available units for every 100 extremely low-income households, with Arizona and California not far behind.

On a daily basis, severely cost-burdened families and individuals are forced to make any number of hard choices just to keep a roof over their heads. Gas for the car, or groceries? Healthy food, or cheap fast food? Utility bills, or medicine? A second job, or more time with family? And when any bit of bad luck might just be enough to tip a family over into homelessness – to join the more than half a million people in this country, 125,000 of them children, with no place at all to call home – how can these cost-burdened families even dream of saving for college costs or retirement, or to buy a first home?

Homeownership remains one of the greatest wealth-building opportunities for working families. But that aspiration remains out of reach for a large and growing share of the American population: those making too little money and spending too much of it on rent to save for a downpayment in an environment of ever-increasing home prices and restrictive loan underwriting requirements.

Providing opportunity is essential to American ideals, and a stable, affordable home creates a foundation for success. While the nation’s housing finance system remains in limbo, with any meaningful reform or new policies at least a presidential election away, the Affordable Housing Advisory Council recognizes the importance of continuing to bring the resources of the Bank and its members together with the expertise of local affordable housing developers and community nonprofits to find innovative ways of helping people make a better life for themselves and their families.

AHP: Supporting Targeted Solutions

The Bank’s Affordable Housing Program continues to operate in a good news/bad news environment. Economic growth is a good thing, but the flip side of a growing economy in some parts of our district is that so many long-time residents are being priced out of their local housing markets. The way in which gentrification causes displacement of lower-income families, threatening the diversity of urban areas, poses difficult policy questions, which were the subject of an illuminating panel discussion at a joint meeting of the Bank’s Affordable Housing Advisory Council and Board of Directors in 2015.

There is also good news in the way the affordable housing development community has stabilized after many years of turmoil following the financial crisis. But while tax credit prices have been high, which helps affordable housing developers, construction costs, particularly in California’s booming Bay Area, have risen sharply. Labor has become scarce, with rural areas suffering the most from fierce competition for resources. Increasing costs for rural construction are bound to make providing affordable housing even more difficult.

Through the AHP, the Bank supports affordable housing projects that target specific community and resident needs while offering individuals and families opportunity as well as shelter. The Bank’s competitive application process is a rigorous one, ensuring that projects likely to do the best job of meeting those needs succeed. In 2015, the Bank awarded $44.7 million in grants through 22 Bank members to 64 projects that will construct or rehabilitate 4,187 badly needed units of housing affordable to lower-income individuals and families in Arizona, California, Florida, Georgia, Hawaii, Illinois, Maryland, Montana, Nevada, Oregon, Texas, and Washington.

2015 Competitive Affordable Housing Program Results

  2015 2015 2015  
(Dollars in millions, except subsidy per unit) Rental Ownership Total 1990-2015
Applications Received                
Number of Applications   144   10   154   5,583
Subsidy Requested   $97.2   $3.0   $100.2   $2,363.3
Approved Applications                
Number of Applications   60   4   64   2,148
Subsidy Awarded   $43.2   $1.4   $44.7   $812.0
Number of Units   4,113   74   4,187   114,545
Average Subsidy per Unit   $10,513   $19,459   $10,671   $7,089

Competitive AHP grants awarded in 2015, ranging from $105,000 to $1,500,000 each, will support a wide range of targeted projects, including:

IDEA & WISH: Promoting Sustainable Homeownership and Asset-Building

Homeownership continues to be a big part of achieving the American dream. Owning a home plays a crucial role in narrowing the wealth gap for low- and moderate-income families, which in turn helps build strong, stable communities. For many lower-income families, it adds stability to their lives and can be an important tool for wealth building. Even after the housing bust, over time the net worth of homeowners has significantly outpaced that of renters. 

In 2015, the Bank set aside $9 million from its annual AHP contribution for its Workforce Initiative Subsidy for Homeownership (WISH) and Individual Development and Empowerment Account (IDEA) first-time homebuyer programs. Twenty-eight Bank members reserved $7.1 million in WISH funds and $1.9 million in IDEA funds to help low- to moderate-income families and individuals buy a home in Arizona, California, Nevada, and other states where members do business. Six Bank members participated for the first time. 

Both programs offer eligible homebuyers 3-to-1 matching grants of up to $15,000 for the purchase of a home. WISH, targeted to families and individuals who are ready to make the transition from renting to owning, taps the desires of a hopeful workforce. IDEA, directed at homebuyers who have been saving for the purchase of their first home through an Individual Development Account or participating in their local housing authority’s Family Self-Sufficiency homeownership program or a lease-to-own program administered by a nonprofit or government entity, has been very successful at helping low-income people develop financial skills and build assets, and then achieve the self-sufficiency and pride that comes with homeownership. 

Both first-time homebuyer programs require participants to complete a homebuyer counseling program administered by an experienced organization. This critical educational component is an important feature of the Bank’s programs and, combined with favorable terms and rates on the mortgages the homebuyers receive, a significant driver of the exceedingly low rate of foreclosure among WISH and IDEA program participants. 

Since 2000, the Bank has funded over $73 million in WISH and IDEA matching grants, helping more than 5,500 households achieve the dream of owning their own home.

AHP Implementation Plan Changes

The Bank works with the Advisory Council throughout the year to make needed changes to the AHP Implementation Plan in response to altered circumstances and shifting priorities. In 2015, the Bank made the following key changes: 

Collaborating for AHP Modernization

The Finance Agency is expected to issue a proposed AHP rule with request for comments later this year.  With the goal of achieving a revised regulation that makes the program more nimble and responsive to emerging needs and regional realities, the Bank’s Advisory Council and Community Investment management have been actively engaged since 2014 in the System-wide effort to bring about meaningful improvements to the regulation.

The December 2015 joint meeting of the Advisory Council and the Board of Directors included a panel discussion on AHP modernization, during which the Advisory Council and the Board of Directors were able to engage with Federal Housing Finance Agency staff on the most challenging policy issues. This productive discussion was followed by a tour of local affordable housing projects led by project sponsors, who were able to share their first-hand experiences developing and operating supportive housing projects using AHP subsidy.  

Credit Programs: Community Lending Opportunities

The Bank’s Community Investment Cash Advance (CICA) programs offer Bank members a lower-cost source of funds they can lend for affordable housing, neighborhood revitalization, and economic development activities that benefit low- to moderate-income communities. 

In 2015, members took advantage of these lower cost funds to support local economies, create new affordable housing, and facilitate homeownership for lower-income households, using:

In addition, one member used an ACE letter of credit in the amount of $14 million to help transform a closed automotive plant in Atlanta, Georgia, into Third Rail Studios, a state-of-the-art film and television production studio for the city’s expanding film industry. The developer expects production at the facility to generate 1,000 jobs annually.

AHEAD: Funding for Creative Solutions

The Bank’s Board of Directors determines funding for the AHEAD Program annually. The Advisory Council is very pleased to note that for 2016, the amount of funding for the program will be increased to $1.5 million, in recognition of the growing value of the program to Bank members and their community partners.


Originally established as a source of early stage funding for initiatives that benefit low- and moderate-income communities, the program has evolved to focus on supporting economic development and job training or job creation initiatives that have the potential to help narrow the wealth gap. With grant amounts ranging from $20,000 to $50,000, AHEAD funds can be used to finance a variety of costs that are often difficult for a nonprofit to finance.

In 2015, the number of Bank members submitting successful applications grew to 25, a new record for the program. The Bank reviewed 174 applications requesting $7.6 million before selecting 35 AHEAD grant winners, including projects that:

The AHEAD Program also aims to help Bank members forge productive relationships with nonprofits that have special expertise in community development. With the 2015 AHEAD grants, for example:

Training Community Program Users

To help members and their partners understand and use each of the Bank’s community programs, in 2015 Community Investment staff conducted:

Outreach and Engagement

The Bank is committed to developing and nurturing productive relationships with policymakers and public officials, government agencies, affordable housing advocates, and a variety of community and economic development organizations. These activities further the Bank’s mission and are critical to meeting its Community Lending Plan goals.

In 2015, the Bank sponsored, co-sponsored, or participated in nearly a hundred public and industry events and affordable housing and community development conferences, forums, roundtables, and meetings, including:

In Closing

On behalf of the Advisory Council, I would like to thank the Bank’s management and staff, the Bank’s members, and their community partners. We are grateful to the Bank’s Board of Directors for their consistently active and especially productive engagement with us over the past year.

In closing out 2015, the Advisory Council bid farewell to three valued members. We thank Joe Keeper, Director of Housing, Native American Connections, Inc.; Michael Mullin, President, Nevada Housing and Neighborhood Development Corporation; and Martin Quintana, formerly Chief Financial Officer, Chicanos Por La Causa. Each provided invaluable counsel during their tenures, and their presence will be missed at our Advisory Council table.

We warmly welcome to the table three new members: David Adame, President and Chief Executive Officer, Chicanos Por La Causa, Phoenix, Arizona; Diana Yazzie Devine, President, Native American Connections, Phoenix, Arizona; and Elizabeth Moore, Managing Director, Elizabeth Moore and Associates, Reno, Nevada. The breadth and depth of our new members’ collective experience will ensure that the Bank’s affordable housing and economic development programs continue to deliver well-targeted resources and create opportunity for low-income communities.

Finally, I am pleased to report that in 2016, the Bank will provide over $76 million in funding for the competitive AHP and $12 million for the WISH and IDEA programs, funds that can be used to help families and individuals build a better future.

Respectfully submitted,


Ralph Lippman
Affordable Housing Advisory Council