CREF Policy Update Dec. 9, 2021

Commercial and multifamily developments and activities from MBA relevant to your business and our industry.

Last week House and Senate lawmakers passed a continuing resolution ahead of the December 3 government funding deadline. Also, Federal Reserve Chairman Jay Powell and U.S. Treasury Secretary Janet Yellen provided testimony to both the Senate Banking and House Financial Services committees on the state of the U.S. economy. And last Tuesday, HUD’s Office of Multifamily Housing published a memo to FHA MAP lenders, providing guidance for loan closing documents.

1. Congress Passes Stopgap Funding Bill to Avert Government Shutdown 

Yesterday, House and Senate lawmakers passed a continuing resolution (CR) ahead of the December 3 government funding deadline. President Joe Biden is expected to sign the measure today to avert a shutdown. The stopgap funding bill punts fiscal year (FY) 2021 funding to February 18, 2022.

• Why it matters: The stopgap measure extends several expiring authorizations that were addressed in the previous CR, including the National Flood Insurance Program (NFIP).
• What’s next: Congressional leadership continue its closed-door negotiations on the next fiscal cliff tied to the debt ceiling. Treasury Secretary Janet Yellen has said Congress has until December 15 to raise the nation’s borrowing limit or risk a catastrophic default that would have widespread ramifications for the global economy. MBA will provide members with relevant updates as necessary.

For more information, please contact Borden Hoskins at (202) 557-2712 or Alden Knowlton at (202) 557-2741.

2. HUD Announces Elimination of Hard Copies of Closing Documents Post-Endorsement 

On Tuesday, the U.S. Department of Housing and Urban Development (HUD) Office of Multifamily Housing published a memo to Federal Housing Administration (FHA) MAP lenders, providing guidance for loan closing documents.

• Why it matters: The memo said, “HUD has now determined that submission of hard copies is not required, provided that they are identical in every respect to the electronic submission.”
• What’s next: Lenders are no longer required to submit the Form HUD-9585 entitled, “Lender Certification Electronic Submission of Closing Documents.”

For more information, please contact Grant Carlson at (202) 557-2765.

3. HUD Reports to Congress on Evictions 

HUD’s Office of Policy Development and Research (PD&R) recently released a report on residential evictions. The report was released in response to a request by Congress.

• Why it matters: HUD stated in a press release, “The report provides background on the need for an eviction database; a detailed discussion of lessons learned to date from efforts to collect data on court-ordered, extra-legal, and administrative evictions, including evictions of HUD-assisted households; and a set of potential approaches for how HUD could move forward to build a national dataset on evictions, assuming additional federal funding and action from Congress.”
• What’s next: MBA will continue to follow policy developments regarding evictions and the potential for the creation of a national database.

For more information, please contact Grant Carlson at (202) 557-2765.

4. Fed Chief and Treasury Secretary Testify on Capitol Hill, Address Inflation and Supply Snarls

Earlier this week, Federal Reserve Chairman Jerome Powell and Treasury Secretary Janet Yellen testified before both the Senate Banking and House Financial Services committees, stating they underestimated how quickly the U.S. economy would rebound from the COVID-19 recession and strained supply chains. Both Yellen and Powell said substantial fiscal and monetary stimulus played a role in stoking the higher demand that fueled inflation, referring to the phenomenon as a challenging side effect of an otherwise fast recovery. Lawmakers in both the House and the Senate engaged the two top U.S. economic policymakers on a variety of other topics, such as the federal debt limit, bank reporting proposals, rental assistance implementation, and the proposed Build Back Better Act (BBBA) tax and social infrastructure proposal. A summary of both hearings can be found here.

• Why it matters: During the Tuesday hearing before the Senate Banking Committee, Chairman Powell indicated that the central bank could accelerate a removal of its “quantitative easing” efforts to boost the economy. Powell also said he thinks reducing the pace of monthly bond buys can move more quickly than the $15 billion-a-month schedule announced last month.
• What’s next: If the Federal Open Market Committee (FOMC) chooses to accelerate its plans, that could mean a “tapering” earlier in the spring next year, giving the Fed leeway to raise interest rates. Powell said he expects the issue to be discussed at the December FOMC meeting. And Secretary Yellen will continue to call on Congress to raise the statutory federal debt limit and pass President Biden’s BBBA proposal as soon as possible (prior to year’s end). 

For more information, please contact Ethan Saxon at (202) 557-2913 or Tallman Johnson at (202) 557-2866. 

5. ESG/CLIMATE RESOURCES

IOSCO Calls for Oversight of ESG Ratings and Products Providers

In a report published last week, the International Organization of Securities Commissions (IOSCO) called for regulators to intensify their focus on the use of environmental, social, and governance (ESG) ratings and data products. The report’s recommendations include promoting more transparency regarding the methodologies that ESG ratings providers use in developing their products, ensuring that there are procedures in place for managing conflicts of interest, and improving communications between providers and entities covered by the data products.

• Why it matters: IOSCO is the international body that brings together the world’s securities regulators and is recognized as the global standard-setter for the securities sector. IOSCO’s recommendations may impact ESG ratings and data products used by MBA CREF members.
• What’s next: MBA staff will continue to track relevant ESG standards and data as they pertain to the industry.

For more information on climate or ESG, please contact Adrian Ballinger at (202) 557-2774.

6. LISTEN: MBA’s Jamie Woodwell Podcast Interview on Commercial/Multifamily Trends and Outlook 

Jamie Woodwell, MBA’s Vice President of Commercial Real Estate Research, recently recorded a podcast interview with RealCrowd CEO Adam Hooper on macroeconomic trends, commercial/multifamily investor demand as the pandemic evolves, interest rates, loan demand by property and investor type, and much more as the industry looks ahead to 2022.

• What it says: Click here to listen to the podcast and/or read the transcript.

For more information, please contact Jamie Woodwell at (202) 557-2936.

7. mPact Fall Fundraiser Benefiting MBA Opens Doors Foundation 

mPact will host the first of three fundraising events benefiting the MBA Opens Doors Foundation (ODF) on December 9, 2021. Join us for a fun cooking class on how to make dumplings with Top Chef Frontrunner Chef Nini Nguyen.

• Why it matters: Each fall, the mPact team takes on a series of fundraisers with the goal of raising funds to support ODF’s mission of providing mortgage and rental assistance grants to parents and guardians caring for a critically ill or injured child.
• What’s next: Help mPact support families in need while taking care of yourself! If you would like to register for multiple events, register here with a $25 donation for each event.

For more information, please contact Jacky Salazar at (202) 557-2746.

8. State Trackers

• State eviction moratorium and legislative activity tracker available here.

For more information, please contact William Kooper at (202) 557-2737 or Grant Carlson at (202) 557-2765.

7. Upcoming MBA Education Webinars on Critical Industry Issues

MBA Education continues to deliver timely programming that covers the spectrum of challenges, obstacles and solutions pertaining to our industry. Below, a list of recent and upcoming webinars – which are complimentary to MBA members:

• Rental Housing Perspectives: Low-Income Housing Tax Credit Landscape – November 30
• Commercial Real Estate Tech Tools & Trends – December 1
• MISMO Monthly Webinar: Introduction to Extensible Stylesheet Language Transformations (XSLT) – December 8
• DUS Multifamily Asset Management Perspectives – December 14
• Ten Things Your Company Must Do in 2022 – January 12
• The Climate Change Imperative: Exploring the Role of Residential Lenders and Servicers – January 18
• DUS Multifamily Asset Management Perspectives – January 19
• Successful Recruiting in a Changing Marketplace – February 10

MBA members can register for any of the above events and view recent webinar recordings.

For more information, contact David Upbin at (202) 557-2890.