Government and People
April 27, 1999
Mayor Anthony A. Williams, Fannie Mae's Franklin D. Raines Launch $1 Billion House Washington Initiative
WASHINGTON, DC Standing before the historic home of abolitionist Frederick Douglass in Washington, DC's Anacostia neighborhood, Washington, DC Mayor Anthony A. Williams and Fannie Mae Chairman and CEO Franklin D. Raines launched the $1 billion "House Washington: The District of Columbia/Fannie Mae Homeownership Initiative." The initiative is the largest single investment by a private company in the history of the nation's capital.
Fannie Mae (FNM/NYSE), the nation's largest source of financing for home mortgages, has committed to invest $1 billion in this sweeping four-year initiative designed to build and accelerate a new era in Washington by boosting community development and renewing neighborhoods.
House Washington will intensify housing and economic development investment intended to improve neighborhood infrastructure and remove regulatory barriers to residential development.
"We are on the threshold of a renaissance in Washington," Mayor Williams said. "House Washington makes good on the promise we made to marshal the resources of the private sector to bring about an exciting new era of neighborhood revitalization, business growth and long-term investment in our greatest assets: our citizens and our neighborhoods."
Working in partnership with lenders and others in the business, nonprofit, and public sector communities, Fannie Mae will invest in employer-assisted housing initiatives, single-family loan products with flexible underwriting and home buyer counseling features, and "high-impact" capital investments in targeted neighborhoods.
"This $1 billion investment will serve first-time home buyers. It will serve all neighborhoods. It will serve low-, moderate-, and middle-income families throughout the District," Raines said. "And it will serve families who rent. whether they live in single-family or multifamily rental units. We recognize that not everybody is ready for homeownership right now, and we want to make sure those not ready to become homeowners have good, decent affordable rental housing.
"Fannie Mae is enormously optimistic about the prospects for Washington, DC, and the possibilities for increasing homeownership opportunities for current and future DC residents," said Raines. "House Washington will be a catalytic event in the history of DC neighborhoods and the overall future of our nation's capital."
Fannie Mae's House Washington initiative is a nine-point plan to: reclaim city-owned properties; re- engineer the regulatory process; expand Employer-Assisted Housing;
"Washington is a city of great monuments," Mayor Williams said. "We stand here at the steps of the Frederick Douglass Home, a monument to a man who helped shine the light of freedom into every corner of our society.
"Through this new initiative, we will build new monuments to family, community and opportunity across every sector of this city, through the creation of new homeowners and the revitalization of neighborhoods," Williams said.
"Our announcement today signals our commitment to make Washington, DC a city where everyone can achieve the American dream of living and working where there are decent, affordable homes, safe streets. and neighborhoods we all can be proud of," Williams said.
Joining Williams and Raines were key elected officials and representatives from the Greater Washington Board of Trade and the DC Hospital Association, both of whom have joined Fannie Mae in supporting and encouraging the city's employers to become Employer-Assisted Housing partners. Each of these partners will play a role in advancing House Washington to provide affordable housing and rental opportunities throughout the nation's capital.
"The need to provide affordable housing in the nation's capital is palpable, and I am grateful that Fannie Mae and the city are working to meet this need in new and innovative ways," said Congresswoman Eleanor Holmes Norton (D-DC). "With the use of my $5,000 home buyer credit and other tax credits and creative initiatives, the District will show the country what can be achieved by a creative collaboration."
"The partners of House Washington, the city and Fannie Mae, are to be commended for their critical thinking and dedication to eliminating regulatory barriers so that the good work of neighborhood revitalization can continue," said DC Council Chair Linda Cropp. "The partnership combines an abundance of resources that will help infuse new vitality throughout Washington. "
The Chair of the Economic Development Committee, Council member Charlene Drew Jarvis said, "The National Capital Revitalization Corporation (NCRC) is a special initiative that I introduced and shepherded through the Council, the Office of the Mayor, and Congress. I'm personally excited to see the newly formed NCRC play such an important role in this public/private partnership that will ultimately transform once decaying neighborhoods into essential, thriving communities."
"House Washington is a mammoth financial and social undertaking," said Mayor Williams. "We will make this an even greater city when private companies such as Fannie Mae step up to the plate to address the big issues of economic and community development."
Fannie Mae already has been a critical source of affordable mortgage financing for homeownership and rental housing throughout the District, Raines said. "In the 1990s alone, we invested more than $2 billion in mortgages for homes in all four quadrants of the city. Now we'll invest $1 billion over the next four years."
In December 1998, Fannie Mae celebrated the completion of the first homes renovated under the Howard University LeDroit Park Initiative, a strategic partnership that will serve as a national model for community revitalization efforts in other urban areas. The effort was designed to create homeownership for moderate-income families and spur renovation of abandoned housing in the LeDroit Park area. Since the formation of this partnership, Fannie Mae has invested more than $23 million in the Howard University/LeDroit Park community.
Raines said, "Our partnership with Howard University demonstrates a fundamental operating principle of our Washington, DC strategy: to identify key partners and key projects in the city's most challenging neighborhoods, to demonstrate the vibrancy and viability of these communities, and, with our partners, to help stimulate and lead a transformation of these neighborhoods."
Working with the newly formed NCRC, Howard University, the federal government, and private sector partners, Fannie Mae will allocate hundreds of millions of dollars in investment capital to complete the revitalization of the historic LeDroit Park and Georgia Avenue neighborhoods.
As part of House Washington, Fannie Mae also is exploring the opportunity to replicate the success of its LeDroit Park Neighborhood Partners Initiative in other areas of the city.
The Fannie Mae Foundation, a separate entity from, but fully funded by the Fannie Mae corporation, is also a major partner in Washington, DC. As the largest private funder of neighborhood and community development efforts in the District of Columbia, as well as the largest source of philanthropic funds in the Washington area serving those who are homeless, the Fannie Mae Foundation has invested approximately $50 million in Washington efforts over the past ten years.
Over the four years of the House Washington initiative, the Fannie Mae Foundation will invest $55 million, which will include grants, new Community and Neighborhood Development Fund loans, and direct program spending.
"Through the Fannie Mae Foundation, we believe effective neighborhoods involve a network of relationships among people and institutions that support community development and meaningful participation in civic life," Raines said. "The Foundation recognizes that other aspects in addition to affordable housing contribute to the vibrancy of a community and it is committed to making significant investment of its programs, volunteer efforts, and grant and loan funds to revitalize DC neighborhoods."
Raines also announced that the Fannie Mae Foundation, in cooperation with the Washington Wizards, will conduct a Washington DC Home Buying Fair on June 26. The event will bring together lenders, non-profit agencies and real estate professionals to offer potential home buyers a one-stop opportunity to learn how they can buy their first homes.
Raines added, "Mayor Williams and I have spoken at length about a new era for DC residents. We believe that District communities are alive and thriving, that neighborhoods are diverse, and that the sense of community is strong. Children are in safer, more stable environments and are supported by community resources that encourage independent growth and development. Fannie Mae and the Fannie Mae Foundation are proud, in support of Mayor Williams, to play a role in helping Washington, DC express its fullest potential."
For more information on the DC Partnership Office and House Washington or a list of local lenders, please contact the Fannie Mae Consumer Resource Center at 1-800-7-FANNIE (1-800-732-6643) between the hours of 9:00 a.m. to 5:00 p.m. EDT Monday through Friday. To receive a free copy of the Fannie Mae Foundation guide, Opening the Door to a Home of Your Own, please call its toll-free number, 1-888-752-7170.
Fannie Mae is a New York Stock Exchange company and the largest non-bank financial services company in the world. It operates pursuant to a federal charter and is the nation's largest source of financing for home mortgages. Over the past 30 years, Fannie Mae has provided nearly $2.5 trillion of mortgage financing for over 30 million families. More information about Fannie Mae can be found on the Internet at http://www.fanniemae.com .
Style Usage: Fannie Mae's Board of Directors has authorized the company to operate as "Fannie Mae, and the company's stock is now listed on the NYSE as "Fannie Mae. " In order to facilitate clarity and avoid confusion, news organizations are asked to refer to the company exclusively as "Fannie Mae. "
The Fannie Mae Foundation, a private nonprofit solely funded by Fannie Mae, transforms communities through innovative partnerships and initiatives that revitalize neighborhoods and create affordable homeownership and housing opportunities across America. http://wwwfanniemaefoundation.org
HOUSE WASHINGTON: THE DISTRICT OF COLUMBIA/FANNIE MAE HOMEOWNERSHIP INITIATIVE
House Washington is a $1 billion, four-year effort to remove regulatory barriers, expand homeownership and rental opportunities, and meet community development needs throughout Washington, DC, with an emphasis on parts of the city that have been passed over by development in recent years. The plan includes nine points:
1. Reclaim City-owned Properties
2. Re-engineer the Regulatory Process
3. Expand Employer-Assisted Housing
4. Launch a Citywide Homeownership Initiative
5. Support Multifamily Small Loans
6. Create $100 million in Investment Capital
7. Complete the Howard University LeDroit Park Neighborhood
8. Develop New Neighborhood Partners Initiatives
9. Support Neighboring Communities
|For Immediate Release
April 27, 1999
|Contact: Donna Brazile or Sean Gralton
Web Site: http://www.house.gov/norton
Washington, D.C. Congresswoman Eleanor Holmes Norton (D-DC) announced that she was introducing a bill today to make her $5,000 D.C. homebuyer credit permanent because it is "the best hope for replenishing the population decline in the District of Columbia." She made the announcement at the Frederick Douglass National Historic site, where a major housing and neighborhood investment plan for the District was unveiled by Franklin Raines, CEO of Fannie Mae, and Mayor Anthony Williams. Her statement follows:
I have chosen to introduce the District of Columbia $5,000 Homebuyer Credit Act, a permanent version of my $5,000 homebuyer credit, today, because Fannie Mae has significantly increased the credit's value to D.C. residents by monetizing the $5,000 credit. This means that D.C. residents will be able to convert the $5,000 homebuyer credit to cash to help make the down payment on a house. The credit alone would be the down payment on a $100,000 house in the District, As a result, for a $100,000 house, no down payment would be necessary.
I am pleased that the President has already agreed to a one year extension of the credit in his budget, and this extension is likely to be approved. We can't stop now, however. The credit has had the phenomenal effect of helping to make D.C. number one in home sales in the country. Home sales in the District increased an extraordinary 50% last year, 'the fastest pace in the nation,' according to a local analysis, We have gone from 14,206 homesales in 1997, when the credit was enacted, to 21,406 last year. We have come from a few years back when people couldn't sell to where people can't buy today. This is why Fannie Mae's effort to increase the supply of affordable housing is so welcome, Indeed, what Fannie Mae and the city announce here today is indispensable if the District is to accommodate the pool of people willing and eager to buy in the city.
The $5,000 homebuyer credit, coupled with a rapid increase in housing stock and investment, are the best hope for increasing our population on a permanent basis. When people buy homes, they lay down roots and are less likely to flee. We have already lost three times the population in this decade as we lost in the last decade, and we are still losing population. The credit has helped stimulate new population and could ultimately help turn our population loss around.
For years, I have searched for natural ways to Increase revenue for the District. My large tax cut bill, the progressive flat tax, is a major leap forward and it is still alive and kicking. I have an upcoming meeting with the Senators whom I worked with closely on my other D.C. tax breaks. I will soon be announcing a bill to make the entire city an enterprise zone, spreading citywide the lucrative tax breaks for D.C. businesses I won in the 1997 Taxpayer Relief Act However, as the city looks for revenue, it must not lose sight of the reality that there can be no permanent increase in revenue without a permanent increase in our population. Investment in housing is the best way to achieve not only a liveable city in all eight wards, but a thriving city of taxpaying residents who own their own homes.
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