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  • Comment Detail

  • Date: 05/31/18
    First Name: Michael
    Last Name: Steelman
    Organization: Farmers and Merchants State Bank of Bushnell
    City: N/A
    State: N/A
    Attachment: N/A
    Number: RIN-2590-AA83

  • Comment

    Alfred M. Pollard, Esq.
    General Counsel
    Federal Housing Finance Agency
    400 Seventh Street. SW
    Eighth Floor
    Washington, D.C. 20219
    Attention: Comments/RIN 2590-AA83

    Re: Notice of Proposed Rulemaking and Request for Comments –
    RIN 2590-AA83 – Affordable Housing Program Amendments

    Mr. Pollard,

    Regarding your notice of proposed rulemaking upon the Affordable Housing Program (AHP), please accept this correspondence as the comments of Farmers and Merchants State Bank of Bushnell, a community bank located in rural Illinois, and a member of Federal Home Loan Bank of Chicago. I am Chairman and CEO of our community bank, and appreciate the opportunity to comment on the proposed Affordable Housing Program amendments.

    Our community is located in a rural, agricultural area, and most of its citizens are in the low to moderate range of income. The bank has had the opportunity to utilize the Federal Home Loan Bank of Chicago down-payment assistance programs for many years. These grants are extremely important for the lower income borrowers, and can make the difference in a home being affordable for them or not being able to purchase a home at all.

    What is concerning regarding the proposed rule is its complexity and the “outcomes” framework in the proposed regulatory amendments The housing needs in rural Illinois can vastly vary from the metropolitan areas of the Federal Home Loan Bank of Chicago districts of Wisconsin and Illinois. What is needed is flexibility for the Federal Home Loan Bank’s to determine the needs of all of its members, both rural and urban, and let the AHP program work in the best interest of all of its members, as determined by the FHLB community investment staff and FHLB directors. Setting national priorities is commendable, but the complexity and lack of flexibility will make for a less successful program. Better to continue the existing program than layer on complexity and rigid guidelines in the future.

    Page Two
    May 30, 2018

    The complexity of the proposed rule will make it less likely that it is understood and fully utilized by community banks that lack the resources of regulatory and compliance staff to assure compliance with the proposed programs. So long as there is a clear connection to affordable housing, and needs understood by FHLB members, in their communities, a much less complex and flexible program would be much more workable and understandable for community bank members.

    It would be advisable for the FHFA to extend the existing program in order to consider the complexity and lack of flexibility in the proposed rule, and work with the Federal Home Loan Banks, community investment staff, and FHLB members in order to assure that the benefits of the AHP programs continue into the future.

    The FHFA is to be commended for its well-intentioned work on the AHP proposed rule, however it would be best for all parties to extend existing AHP Rules and comprehensively reconsider the same to assure flexibility and reduced complexity.

    Thank you again for the opportunity to comment on the AHP proposed rule.

    Respectfully,

    /S/ Michael G. Steelman

    Michael G. Steelman
    Chairman and CEO