In addition to these overarching issues, other proposals addressed in the 109 th Congress included legislation to create a stronger regulator for Fannie Mae and Freddie Mac, and revisions to the FHA loan insurance program. In the area of the budget generally, as of the date of this report, Congress had not yet enacted an FY2007 spending bill for the Department of Housing and Urban Development (HUD). It included reductions for several programs, including the Community Development Block Grant (CDBG) program, and increases for other programs, such as the Section 8 voucher program. At the time of this update, Congress has enacted three continuing resolutions that provide funding for HUD; the third of these expires on February 15, 2007. After Hurricane Katrina, Congress enacted two FY2006 funding bills that provided funds to HUD for hurricane recovery and reconstruction ( P.L. 109-148 and P.L. 109-234 ). In this budget environment, Congress faced pressure to reduce funding for HUD's programs in the FY2006 and FY2007 appropriations processes. The law included $5.2 billion in additional CDBG assistance for the states of Alabama, Florida, Louisiana, Mississippi, and Texas. The law contained provisions regarding the use and administration of funds that do the following:
require that at least $1 billion of the CDBG amount be used for repair and reconstruction of affordable rental housing in the impacted areas; allow each state to use no more than 5% of its supplemental CDBG allocation for administrative expenses; allow the affected states to seek waivers of program requirements, except those related to fair housing, nondiscrimination, labor standards, and environmental review; allow Governors of the affected states to designate one or more entities to administer the program; decrease the low- and moderate-income targeting requirement from 70% to 50% of the funds awarded; require each state to develop a plan for the proposed use of funds to be reviewed and approved by HUD; direct HUD to ensure that each state's proposed plan gives priority to activities that support infrastructure development and affordable rental housing activities; require each state to file quarterly reports with House and Senate Appropriations Committees detailing the use of funds; require HUD to file quarterly reports with the House and Senate Appropriations Committees identifying actions by the Department to prevent fraud and abuse, including the duplication of benefits; and prohibit the use of CDBG funds to meet matching fund requirements of other federal programs. 109-148 , which was signed by the President on December 30, 2005. 1999 was referred to the House Financial Services Committee; no action was taken on either bill before the end of the 109 th Congress. 5443 , the Section 8 Voucher Reform Act of 2006. Another HOPE VI reauthorization bill, H.R. In FY2006, Congress appropriated $735 million for elderly housing programs. The House would have provided $747 million for Section 202, while the Senate Appropriations Committee would have provided $750 million. In FY2007, for the second year in a row, the President's budget proposed to cut funding for the Section 811 program nearly in half, from $237 million in FY2006 to $119 million. Another bill, H.R. H.R. Two bills were introduced in the first session of the 109 th Congress to strengthen the oversight of Fannie Mae, Freddie Mac, and the banks under a single regulator. H.R. H.R. The House passed H.R. 1461 on October 26, 2005. 1461 . The Senate Banking and Urban Affairs Committee ordered S. 190 reported to the Senate on July 28, 2005. 5121 . The 109 th Congress did not enact any of these predatory lending bills. Low-Income Housing Tax Credit Modifications

The Low Income Housing Tax Credit (LIHTC) was created by the Tax Reform Act of 1986 ( P.L. H.R. 659 and H.R.
The 109 th Congress considered a number of housing-related issues in its two sessions. These included appropriations for the Department of Housing and Urban Development (HUD); assistance for families and communities affected by Hurricanes Katrina, Rita, and Wilma; reform of the Government Sponsored EnterprisesâFannie Mae and Freddie Macâand Federal Home Loan Banks (GSEs and FHLBs); revisions to the FHA loan insurance program; and changes to existing housing programs such as the Section 8 Housing Choice Voucher and the Low-Income Housing Tax Credit program. However, the 109 th Congress adjourned without completing action in many of these areas.
During the appropriations process for both FY2006 and FY2007, Congress faced possible cuts in various HUD programs. In FY2006, the President proposed to reduce the HUD budget by 9%, which included removing the Community Development Block Grant (CDBG) program from HUD. Congress did not make the majority of the reductions requested by the President. In FY2007, the President proposed to reduce funding to at least 13 HUD programs, while increasing funding for 11 others. In its proposed spending bills, the House and Senate Appropriations Committees restored many of the proposed cuts. However, at the end of calendar year 2006, Congress had not passed a budget bill for FY2007. Instead, it provided funding for HUD, among other agencies, through three continuing resolutions, the third of which expires on February 15, 2007. For most HUD programs, this means that funding continues at the FY2006 level.
Congress twice appropriated funds to HUD after the 2005 hurricanes. First, Congress provided $11.5 billion for the CDBG program to be used in affected areas ( P.L. 109-148 ). This amount was divided among the states of Louisiana, Mississippi, Alabama, Florida, and Texas. The second appropriation ( P.L. 109-234 ) provided $5.2 billion more to the CDBG program for hurricane recovery. In addition to these two allocations of CDBG funds, in P.L. 109-148 Congress provided $390 million in supplemental funding for Section 8 vouchers for families that had received HUD assistance before being displaced by Hurricane Katrina.
Other activities in the 109 th Congress included consideration of two bills to strengthen oversight of the GSEs and FHLBs under one regulator ( S. 190 and H.R. 1461 ). The House passed H.R. 1461 on October 26, 2005, while the Senate Banking and Urban Affairs Committee reported S. 190 to the Senate on July 28, 2005. Another bill ( H.R. 5121 ) would have raised the FHA one-family mortgage limit, and allowed mortgage premiums based on the borrower's risk. In the area of affordable housing, the House Financial Services Committee considered and passed a number of housing bills, including H.R. 5443 to reform the Section 8 voucher program and H.R. 5347 , a bill to reauthorize the HOPE VI program. Legislation was also introduced in the first session that would have increased Low-Income Housing Tax Credits available to develop affordable housing ( H.R. 2681 , H.R. 659 , and H.R. 3159 ). However, none of the aforementioned bills was enacted before the close of the 109 th Congress.