Comment

October 28, 2014 


Attention: Comments / RIN 2590-AA65 
Alfred M. Pollard, General Counsel 
Federal Housing Finance Agency, Eighth Floor 
400 7th St. SW 
Washington, D.C. 20024 


Dear Mr. Pollard:

This letter comments on your Agency’s proposed Enterprise Annual Housing Goals for 2015-2017 as published in the Federal Register Vol. 79 No. 176, 12 CFR Part 1282 Proposed Rule September 11 2014. 

The Oram Foundation (www.enviro-urban.org) is a private, non-operating foundation.  Our mission focuses on cities, people, the environment and social betterment in the urban setting.   I founded the Fund in 2006, and have been active in urban planning, urban transport and related topics for over 40 years.  My credentials include receipt of an Outstanding Public Service Award from the US Department of Transportation.     

In the past three years, my Fund in concert with other organizations has studied impediments to provision of low and middle income housing, with particular regard to suburban areas where many lower income people are now locating, partly as a result of the “revitalization” of older neighborhoods and rapid increase in rents in these settings.  The opportunity that we found was to build more housing in areas such as suburban travel corridors (“suburban strips”).  That is just one example but is very illustrative.  These corridors normally have some transit access to central areas as well as suburban jobs destinations, such as malls and office parks.  They are development-ready with vacant properties, such as car dealerships and old retail. Towns would welcome the development, even lower income housing that is too often shunned.  In all, this appears like a promising piece of the housing puzzle.  

Yet Federal housing programs are not very supportive of this vision.  New development, evidenced by market demand, should favor mixed use.  People who don’t have cars should be able to walk to get food, medical care and other services.  But development in these locations is inherently low rise, and for example if a project for a four storey building with a non-residential use on the ground floor seeks support from the federal housing programs, it is rejected as non-conforming because the commercial component exceeds the rather low non-residential maximums that all of the federal programs have (in varying ways).  This is in fact a huge issue, as relatively few locations can support buildings taller than four floors.  Land use, energy, environmental, social and other concerns can be linked to this issue.  This was eye-opening to me, despite my long career.  Sometimes apartments are built in such settings, but ground floor isn’t appropriate for that either.  “Separated uses” has become an urban planning concept that many have discarded.   The non-residential limits reflect that framework.
  
Your request for comments notes quantitative goals for the federal housing programs, but I suggest “the problem” is more structural than quantitative.  If we got an added 10 percent lower income housing financed, for example, but of the same type we now have, the result would of course be very positive yet the full opportunity for addressing many other problems would be missed.  I suggest that we need mixed neighborhoods – mixed by resident age and income, ethnicity, unit size, quality, commercial/residential uses and in other ways.  In essence, we need community.  Financing all too often makes this product – what’s most desired now – unavailable.  

To this end, a broader and more qualitative revision of federal housing goals is needed (and changing non-residential limits does not require new legislation, we found).  We don’t just need more low income housing, we need better communities.  The non-residential limits in the housing programs are one element that has made our cities unique, and especially problematic in some ways.  We also studied land use in Canada and found far more investment in low rise structures, notably in older downtowns.  Our housing programs miss this.  

We also discovered that FNMA did research very relevant to this, which was very enlightening and actually a turning point in our review. The research, by Prof. Gary Pivo at the University of Arizona, found that mortgages in areas defined as “sustainable” -- a reasonable surrogate for mixed use -- are far less likely to default than mortgages in non-sustainable locations, such as single use or auto-oriented locations.  That is, mixed use is better for everyone.    

I appreciate the opportunity to raise this issue with you.  I will be happy to share other information or assist any way that I might.  

Very truly yours,



Richard L. Oram
Chairman