We’re two months away from the midterm elections, where housing affordability will be top of mind for millions of American voters. Lawmakers at all levels have noticed. Congress recently passed the comprehensive ROAD to Housing Act, aiming to stimulate housing supply and lower housing costs. But while this law contains many great provisions, pilot programs, and plans to help tackle our housing crisis, it has one major flaw: it came without any appropriations. Without actual funding to stimulate homebuilding, reduce barriers for first-time homebuyers, or support the federal agencies being tasked with launching and improving housing programs, it will be very hard for this legislation to move the needle on America’s housing crisis.

Some lawmakers are working on expanding funding for housing needs. Yesterday, during a mark-up session in the House Financial Services Committee, Congresswoman Maxine Waters introduced a bill (H.R. 10325) that would allocate an additional $300 million in funding each year for affordable housing. Importantly, these millions in housing funding would not require a single additional taxpayer dollar.  

How? By requiring the Federal Home Loan Banks (FHLBanks) to contribute more to housing.

The FHLBank System is a large government-subsidized housing finance system of 11 regional Banks that  is charged with providing cheap loans to banks, credit unions, and insurance companies. Yet the FHLBanks remain unknown to most consumers. While these cheap loans are meant to help boost home lending, in practice, companies draw on FHLBank borrowing to support all kinds of business activities, buttress liquidity needs, and boost profits.

The Congressional Budget Office has estimated that the Home Loan Banks benefit from $7 billion in public subsidies every year, including tax exemptions, regulatory breaks, and a special status as a government-sponsored enterprise that significantly lowers their borrowing costs. Congress created this System almost a century ago to boost access to affordable mortgages. But over time, the System and its members have strayed from this purpose. 

Today, the System’s benefits increasingly flow to the biggest Wall Street banks and insurance companies, rather than small lenders, communities, and families. In 2025, the FHLBanks paid $3.5 billion in dividends to their member banks and insurance companies, while spending less than one-third of that amount on housing programs. Almost half of its bank and insurance company members don’t even originate mortgages anymore.  

So demanding that the FHLBanks do more for housing – and return a greater share of their subsidy to their public mission – seems straightforward.

Yet, Republican members of the House Financial Services Committee voted against more funding for housing: preventing the bill from moving out of committee and onto the House floor. Leading up to this committee vote, Congressmen Mike Flood and French Hill spoke out against increasing housing funding.

Their argument? They call the Affordable Housing Program funding requirements too bureaucratic and “inflexible.” They also point to the increase in charitable housing contributions that the FHLBanks have made over the last three years. While these so-called “voluntary programs” have been impactful, they were only undertaken under mounting political pressure. Charitable donations are not a substitute for a permanent housing commitment.  

What could adding $300 million in funding for the Affordable Housing Program accomplish?

Based on the current program, CFA estimates that it could annually help fund:

• The construction of an estimated 12,500 affordable rental units
• Down payment and closing costs for 7,000 would-be homebuyers
• And, necessary home repairs for more than 600 families

These are not abstract numbers, but real homes for tens of thousands of families. Increasing the housing contributions from the Federal Home Loan Banks would provide a much-needed balance to the $7 billion in subsidies and tax breaks they enjoy every year. Indeed, passing this housing bill would help secure housing subsidies year-after-year in perpetuity, without being based on the shifting charitable spirit of a System that is focused on its own bottom-line.

Congress must commit real funding to tackle our housing crisis: we cannot afford to leave critical housing dollars on the table.