How to Turn Around the FHLB's Economic Development

The lackluster performance of the Federal Home Loan Banks' economic development could be improved by following the model of their own Affordable Housing Program, writes Carol Wayman.

2 minute read

August 23, 2011, 6:00 AM PDT

By Matthew Brian Hersh


"Many housing developers are familiar with the FHLBanks' Affordable Housing Program (AHP), which requires each of the 12, independent, regional banks to set aside 10 percent of annual profits to invest in local affordable housing initiatives," writes Wayman, federal policy director of the Corporation for Enterprise Development (CFED). "The results have been incredibly positive, with more than $4.2 billion in grants administered since 1990, creating more than 700,000 units. The program has been the 'crown jewel' of the system as it brings strong housing development proposals together with appropriate financing. AHP is the largest source of private funds available for affordable housing in the nation."

While there are examples of good economic development financing from FHLBanks-a community space in Washington, DC's Shaw neighborhood; a permanent, year-round farmers' market for low-income farmers and entrepreneurs in Nevada; the redevelopment of vacant commercial property into mixed-use development in Worcester, Mass.; a series of loans given to small businesses in Wisconsin - but for a GSE that gets benefits from its semi-public status, the amounts are disappointingly low.

"The best way to increase investment in community economic development is to mandate it," writes Wayman, "using the AHP model - setting aside a percentage of FHLBanks' annual profits for investment in community economic development projects identified by member financial institutions.

"In this time of overwhelming budget cuts, high levels of unemployment and global economic change, a long-term, significant funding source that brings together community development organizations, local governments, and the financial sector could play a crucial role to building a stronger, more inclusive economy."

Thanks to Matthew Brian Hersh

Monday, August 22, 2011 in Shelterforce

portrait of professional woman

I love the variety of courses, many practical, and all richly illustrated. They have inspired many ideas that I've applied in practice, and in my own teaching. Mary G., Urban Planner

I love the variety of courses, many practical, and all richly illustrated. They have inspired many ideas that I've applied in practice, and in my own teaching.

Mary G., Urban Planner

Cover CM Credits, Earn Certificates, Push Your Career Forward

Logo for Planetizen Federal Action Tracker with black and white image of U.S. Capitol with water ripple overlay.

Planetizen Federal Action Tracker

A weekly monitor of how Trump’s orders and actions are impacting planners and planning in America.

June 25, 2025 - Diana Ionescu

Map of Western U.S. indicating public lands that would be for sale under a Senate plan in yellow and green.

Map: Where Senate Republicans Want to Sell Your Public Lands

For public land advocates, the Senate Republicans’ proposal to sell millions of acres of public land in the West is “the biggest fight of their careers.”

June 19, 2025 - Outdoor Life

Person wearing mask walking through temporary outdoor dining setup lined with bistro lights at dusk in New York City.

Restaurant Patios Were a Pandemic Win — Why Were They so Hard to Keep?

Social distancing requirements and changes in travel patterns prompted cities to pilot new uses for street and sidewalk space. Then it got complicated.

June 19, 2025 - Diana Ionescu

Aerial view of town of Wailuku in Maui, Hawaii with mountains in background against cloudy sunset sky.

Maui's Vacation Rental Debate Turns Ugly

Verbal attacks, misinformation campaigns and fistfights plague a high-stakes debate to convert thousands of vacation rentals into long-term housing.

15 minutes ago - Honolulu Civil Beat

White and purple sign for Slow Street in San Francisco, California with people crossing crosswalk.

San Francisco Suspends Traffic Calming Amidst Record Deaths

Citing “a challenging fiscal landscape,” the city will cease the program on the heels of 42 traffic deaths, including 24 pedestrians.

1 hour ago - KQED

Tents inhabited by unhoused people lined up on sidewalk in Los Angeles, California in front of industrial building.

California Homeless Arrests, Citations Spike After Ruling

An investigation reveals that anti-homeless actions increased up to 500% after Grants Pass v. Johnson — even in cities claiming no policy change.

2 hours ago - Times of San Diego

Urban Design for Planners 1: Software Tools

This six-course series explores essential urban design concepts using open source software and equips planners with the tools they need to participate fully in the urban design process.

Planning for Universal Design

Learn the tools for implementing Universal Design in planning regulations.