Two housing advocacy groups are suing federal housing officials, claiming they are illegally withholding at least $382 million from a fund created by Congress to support affordable rental housing for poor people.
The National Low Income Housing Coalition and the Right to the City Alliance filed suit in federal court in Miami on Tuesday seeking to have the Federal Housing Finance Agency provide the money to a national housing trust fund.
The trust was created five years ago. Funding was supposed to come from Fannie Mae and Freddie Mac, the two government-sponsored mortgage guarantee giants. They nearly collapsed during the financial crisis and the trust hasn’t been funded.
After a $187 billion government bailout, Fannie and Freddie are profitable again, pumping billions of dollars into the Treasury.