Talking Heads: Stockton Williams, Executive Director, National Council of State Housing Agencies
By Darryl Hicks
9 min read
Local and Common Missions
In a career spanning more than 25 years, Stockton Williams has become a leading voice of the affordable housing movement in Washington, DC.
In March 2018, he was named executive director of the National Council of State Housing Agencies (NCSHA). What began as a small group of executive directors meeting annually has over the past four decades grown into a powerful national association and advocate for housing finance agencies and affordable housing in Washington.
NCSHA represents its members in Washington before Congress, the Administration and various federal agencies concerned with housing, including the Department of Housing and Urban Development, the Department of Agriculture and the U.S. Treasury, and with other advocates for affordable housing.
Prior to joining NCSHA, Williams held senior leadership positions in the private, public and nonprofit sectors throughout a career dedicated to expanding housing opportunities. He has been an advisor to many local communities across the United States, an author of original research, a speaker at industry events around the country and a frequent commentator in the media on a wide range of real estate and economic development issues.
Williams was executive vice president of content and executive director of the Terwilliger Center for Housing at the Urban Land Institute, managing principal at consulting firm HR&A Advisors’ Washington, DC office, and a senior advisor at HUD and the U.S. Department of Energy. He began his career as an affordable housing developer.
Tax Credit Advisor sat down with Williams to gain a better understanding of HFAs and how they work and other policy priorities at NCSHA.
Tax Credit Advisor: Do housing finance agencies have their own goals and viewpoints?
Stockton Williams: Each HFA was created under its state’s law to meet its state’s particular housing needs. Each agency executes its own strategies to meet that responsibility. In that sense, no two state HFAs are exactly alike. At the same time, all state HFAs share a common mission to provide affordable housing financing to all parts of their states and a similar operating model, which is to function, in many ways, like a mission-oriented business. Even though state HFAs are charged with meeting affordable housing needs in every part of their states, they generally don’t rely on their state government for financial support. They need to be entrepreneurial in using their own balance sheet and resources to fulfill their mission.
TCA: Do HFAs pluck good ideas from other agencies? Can I bring an idea or approach or priority from, say, the Tennessee HFA to the Massachusetts HFA as a suggestion?
Williams: Absolutely. In fact, that’s one of the principal reasons why HFAs created the National Council of State Housing Finance Agencies more than 40 years ago. HFAs are constantly learning from each other, sharing best practices and solving emerging challenges on a collaborative basis. NCSHA facilitates these exchanges and augments them with additional analysis and support.
TCA: When NCSHA members gather, what areas are they seeking information?
Williams: Virtually all aspects of their operations: finance, policy, program administration, communications, technology, human resources. Even the smallest HFAs are sophisticated and multi-faceted. All the agencies actively share experiences and best practices at conferences, through online community groups, and on regular conference calls organized by NCSHA.
TCA: Do states work together or separately? What issues unite them, or divide them? What is the role of NCSHA in bringing them together?
Williams: State HFAs are united by their common housing mission and operating model. They also share a set of annual federal policy priorities, which NCSHA works to advance on the HFAs’ behalf. There are other ways HFAs collaborate as well. Many state HFAs service their single-family mortgages in-house and some service loans on behalf of other HFAs. Another example is in developing best practices in program administration, as the agencies have done for years through NCSHA regarding the Low Income Housing Tax Credit program.
TCA: You mentioned earlier that HFAs need to be self-sustaining because they don’t receive taxpayer funding. I would imagine that HFAs earn fees for servicing mortgages in-house or for other HFAs. Can you provide other examples of how HFAs generate income?
Williams: The primary ways that state HFAs generate revenue to run their operations and advance their missions is through issuing tax-exempt bonds and by accessing the secondary mortgage market via mortgage-backed securities. Each of these approaches supports affordable for-sale and rental housing. State HFAs generated more than $28 billion to finance more than 152,000 for-sale homes and more than $8 billion to finance more than 123,000 rental apartments in 2017. HFAs reinvest their earnings into programs and activities that create and preserve more affordable housing.
TCA: What advice would you give to someone who’s new to affordable housing and just starting to develop a relationship with his or her HFA?
Williams: I think anyone who’s in that situation would find their state HFA readily accessible, and they can always come to NCSHA for assistance as well.
TCA: At NH&RA’s Annual Meeting this past February, you discussed the importance of tax-exempt private activity bonds in financing multifamily affordable housing. What policies would you like to see changed in 2019 to help expand their utilization at the state level?
Williams: NCSHA has been working for some time to get legislation enacted that would provide for a more flexible “recycling” of multifamily housing bonds. Proceeds from recycled bonds can be used to finance multifamily affordable housing, but they can’t be put back into use for other purposes under the “private activity bond cap.” In addition, the multifamily housing bonds that are recycled don’t generate four percent housing credits. So, we have been working to pass legislation that would enable states to use recycled bonds for a wider array of purposes, including affordable single-family housing. That would allow states to use more of the recycled housing bond authority for housing overall and for multifamily housing with housing credits.
TCA: What affordable housing initiatives are you lobbying Congress for and what is the likelihood that Congress and the administration will enact them?
Williams: NCSHA and other leading national housing organizations have been working for several years on a comprehensive bill that would increase and improve the LIHTC. It’s called the Housing Credit Improvement Act. In the last Congress, bipartisan House and Senate legislation generated substantial co-sponsorship on both sides of the aisle but did not pass. We are working with House and Senate leaders to get the Housing Credit Improvement Act reintroduced again on a bipartisan basis. It will provide for a substantial increase in housing credits and improvements to make them more efficient and effective.
We’re getting ever closer to the heat of the 2020 presidential election cycle, so it’s hard to forecast the legislative environment. Our view has always been that we need to enlist strong bipartisan co-sponsorship, so that we are ready to be included in any legislative package that starts moving in Congress and could wind up on the president’s desk. It could be a technical corrections bill to the 2017 tax cut, or an extender’s bill to continue tax incentives that are set to expire, or an annual funding bill, as we saw in 2018 when Congress passed an omnibus appropriations bill that made a down payment on the housing credit increase and implemented an important program change that allowed the program to create more mixed-income developments.
We are also focused in our advocacy efforts related to affordable rental housing on advancing state HFA priorities on Government Sponsored Enterprise (GSE) reform, appropriations for HOME and other key HUD programs, forthcoming guidelines for the project-based rental assistance contract administration, and potential changes to the Community Reinvestment Act.
TCA: NCSHA has been keeping a watchful eye on Opportunity Zones and the growth of OZone Funds. There are OZone expos and conferences occurring regularly. It seems like a lot of hype for a tax incentive that lacks a regulatory framework and expires at the end of 2026. Do you see OZones playing a meaningful role helping to revitalize distressed communities?
Williams: We do. Many state HFAs were at the table working with their governors to designate the areas that would be eligible for Opportunity Zone investments. A number are working to market worthy investment opportunities within their states’ zones, leveraging their market knowledge from having provided financing for housing and economic development in many of the zones. Some HFAs have deployed their own resources into Opportunity Zones. Maryland and Mississippi are two states that come to mind that through different tools have put resources on the ground in Opportunity Zones to help make them more successful.
NCSHA is also at the forefront of our industry’s efforts to utilize Opportunity Zone incentives to the fullest extent for affordable housing development and preservation. We have testified at the IRS on program regulations and met with HUD and Treasury officials. Every few weeks, we publish a revised directory of publicly announced Opportunity Zone Funds that tracks what fund managers intend to do with Opportunity Zone capital, how much they plan to raise, and where they say they’re going to invest in. We’ve consistently, over time, seen more fund managers identify affordable housing and workforce housing as an investment area of focus, which is encouraging. We’ve also seen several well-established affordable housing organizations, such as Avanath Capital Management, Boston Financial, Enterprise and LISC, create Opportunity Zone funds. These are also good signs.
TCA: You’ve been head of NCSHA for just over a year. What has been your proudest achievement thus far? What are your goals for 2019?
Williams: One that comes to mind is NCHSA’s work leading the affordable housing industry’s response to the Government Accountability Office’s long-running inquiry into development costs in the housing credit program. NCSHA and several HFAs worked closely with the GAO to provide data and the context for analyzing it. In addition, NCHSA commissioned an independent look at development costs in housing credit properties by Abt Associates. The common headline across the two studies, both of which were comprehensive, analytical and credible, was that development costs in the housing credit program are in line with development costs in multifamily housing overall over the past several years. We believe both studies both validate the efforts states are making to control and monitor development costs and ensure that most efficient use of this critical resource. The results are also a credit to the housing credit developers who work with the states to use credits efficiently. Development cost discipline will continue to be a priority of NCSHA’s and the states.
Story Contact:
Stockton Williams
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