Proposed Initiatives For State Action on
Affordable Housing in 2010

Protect the ability of non-profit organizations with federal tax-exempt charitable status to rent condos and/or townhouses that they own in order to provide affordable housing.

The federal Home Affordable Modification Program (HAMP) is meant to give homeowners with loans owned or guaranteed by Fannie Mae or Freddie Mac or other participating servicers an opportunity to refinance into more affordable monthly payments. However, many servicers participating in HAMP are not following all of the program’s directives, especially the requirement that loans be evaluated for HAMP eligibility before foreclosure proceedings are commenced.

To increase compliance with this program, and other mandatory loss mitigation programs, we propose amending current state law to require foreclosure complaints to state whether the mortgage is eligible for HAMP and whether a HAMP modification has been attempted. The amendment would also allow borrowers to use lack of loss mitigation program compliance as a defense against foreclosure.

Collect a $1,000 fee from the proceeds of foreclosure sales to be used to pay for foreclosure counseling, borrower outreach, and mediation.

• Programs from around the country show that requiring delinquent borrowers and servicers to come together to talk can significantly reduce foreclosures. In some programs, 3/4 of all participants resolve their cases without foreclosure – saving homes, neighborhoods, and tax dollars. Borrower Outreach is a key component to successful programs.
• Mandatory mediation only requires people to talk – if they don’t find an alternative that both sides prefer, the foreclosure moves forward.

Give local governments tools to maintain vacant properties

• Require banks to maintain vacant properties: Authorize local governments to ensure that properties are maintained and secured by enacting vacant and abandoned property ordinances and holding lenders, like banks and trustees of mortgage-backed securities, responsible for maintaining such properties.

The Illinois Assisted Living and Shared Housing Act (IAL/SHA) is inconsistent with the Federal Fair Housing Act (FHA) and the Illinois Human Rights Act (IHRA), allowing Illinois seniors to face discrimination and denial of needed services and housing because of race or disability. The proposal amends the provisions of the IAL/SHA that govern the licensing, construction, and operating standards of an Assisted Living establishment to reinforce that senior housing providers must comply with the FHA and the IHRA.

Amend the Forcible Entry and Detainer Act to provide an affirmative defense from rental housing eviction predicated on the tenant’s, lessee’s, or household member’s status as a survivor of domestic violence, dating violence, stalking, or sexual violence.

The Homelessness Prevention Program provides financial assistance to prevent individuals and families from becoming homeless and helps those who are experiencing homelessness to be quickly re-housed and stabilized. For fiscal year 2010, funding was reduced to $2.4 million from $11 million in the previous fiscal year—a 78% cut. While the federal Homeless Prevention and Rapid Rehousing Program (HPRP) stimulus funds have very similar allowable uses, we need to restore state funding to insure that resources are available when HPRP funds are exhausted.

Restore prior year budget cuts for the Emergency Food and Shelter Program. The program provides overnight shelters, transitional housing and supportive services. Funding for fiscal year 2010 is $9.1 million while funding in fiscal year 2003 was $9.7 million. We will also request the renaming of the "Emergency Food & Shelter" line item to "Emergency and Transitional Housing." This proposed name more fully captures the role of overnight shelters and transitional housing programs in the long-term process of rehousing individuals and families.