Governor O'Malley Announces Plan to Promote and Sustain Affordable Housing in Maryland
New Issue Bond Program will create opportunity to build 1,000 more affordable
BALTIMORE, MD (January 8, 2010) –Governor Martin O’Malley announced a Four Point Plan for improving Maryland neighborhoods, reducing foreclosures, and making quality housing more affordable for more people. The Governor made this announcement at the annual meeting of the Maryland Affordable Housing Coalition (MAHC) in Baltimore today.
In partnership with the Obama administration, The Maryland Department of Housing and Community Development (DHCD) is implementing the New Issue Bond Program, which will help open up access to affordable housing for low- and middle-income families – whether they are renting or buying. “I am excited that we have in the Obama administration a partner with a strong agenda who cares about the things we care about – including quality housing for all families regardless of income,” Governor O’Malley told the group.
Governor O’Malley said that Maryland will receive more than $246 million under the Obama administration’s plan to help stabilize the U.S. housing market. The initiative will help developers of multifamily rental projects by providing a low fixed interest rate and making $90 million available for these projects. Through this program, DHCD will expect to serve nearly 1,600 new homeowners and create or rehabilitate about 1,000 rental units.
“These are critical resources for Maryland families at a time when our need for a wide range of housing choices is critical,” the governor said during a keynote address before the Maryland Affordable Housing Coalition. “The national economic crisis and collapse of the housing market illustrate the need for a balanced housing agenda, one that preserves and protects homeownership while expanding affordable rental housing so that low to moderate income workers, including teachers, fire fighters and police officers, have an opportunity to raise their families in the communities they serve.”
The program will help more families get through the economic downturn by maintaining the viability of lending programs and supporting low mortgage rates. These measures will expand resources for low and middle-income families to buy or rent affordable homes.
In addition, the O’Malley-Brown Administration is proposing three new housing initiatives in the upcoming Legislative session.
- To fight foreclosures, we are working with bankers, housing advocates and attorneys to ensure that people who are most a risk for a foreclosure and who are also eligible for a loan modification get one – instead of suffering a needless foreclosure.
- To promote greater economic development and revitalization in our neighborhoods, we’re proposing a small business lending program that would help grow and develop microenterprises in designated neighborhoods.
- To better support group homes who serve people of lower income, seniors, individuals with disabilities, and other residents with special housing needs, we are proposing legislation to help save money and cover increases in operational costs.
The Obama administration announced its New Issue Bond Purchase program last fall and the Department of Housing and Community Development has been working with federal officials over the past few months on how to implement the program.
Using authority under the Housing and Economic Recovery Act of 2008, the Treasury Department will purchase securities of Fannie Mae and Freddie Mac that are supported by mortgage revenue bonds issued by DHCD and other state Housing Finance Agencies. The program is designed to allow state Housing Finance Agencies to weather the effects of the one of the worst downturns in the housing market since the Great Depression.
“The instability in the tax credit and bond markets made last year a very difficult one, hampering our ability to get projects completed,” said Maryland Department of Housing and Community Development Secretary Raymond Skinner. “It was only with the intervention of the Obama administration through the American Recovery and Reinvestment Act (ARRA) that we were able to close deals that might otherwise have been stalled.”
Maryland received $110 million last year through ARRA’s Tax Credit Assistance Program and Section 1602 tax exchange program. DHCD used $66.5M of these funds to jumpstart 16 projects in the last weeks of 2009, generating 907 construction jobs and bringing the total number of rental units created and preserved in CY 2009 to 2,258. The agency expects to use the remaining $43.5 million to start construction on 12 more projects during the first quarter of 2010.
Governor O’Malley used the occasion of the MAHC Annual Meeting to make this announcement because of the strong partnership already developed between the Administration’s housing and community development agency and the affordable housing developers who are members of MAHC.
Formed in the spring 2000, the Maryland Affordable Housing Coalition is an advocacy group for resources for affordable housing development through increased funding for established programs, such as DHCD’s Rental Housing Programs. In addition, MAHC believes in developing and promoting "best practices" in conjunction with the Maryland DHCD staff through frequent interactions and trainings.