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42 FHFA REVISES ITS MINORITY AND WOMEN INCLUSION REGULATIONS e Federal Housing Finance Agency (FHFA) announced Wednesday the issuing of a Notice of Proposed Rulemaking. Now the agency is seeking comments on proposed amendments to its Minority and Women Inclusion regulations. In 2010, FHFA adopted regulations to facilitate implementation of the requirement of the Housing and Economic Recovery Act of 2008 to promote diversity and inclusion in all FHFA's and GSEs' businesses and activities. e proposed amendments further clarify the scope of the regulated entities obligation to promote diversity and inclusion. e proposed amendments would first require the regulated entities to engage in diversity and inclusion strategic planning by developing stand-alone plans or by incorporating diversity and inclusion into their existing strategic planning processes. ey would also encourage the regulated entities to expand contracting opportunities for minorities, women, and individuals with disabilities through subcontracting arrangements. Likewise, these amendments would require the regulated entities to amend their policies on equal opportunity in employment and contracting by adding sexual orientation, gender identity, and status as a parent to the list of protected classifications. ey would additionally require the regulated entities to provide information in their annual reports to FHFA about their efforts to advance diversity and inclusion through capital market transactions, affordable housing and community investment programs, initiatives to improve access to credit, and strategies for promoting the diversity of supervisors and managers. FHFA invites interested parties to submit comments on all aspects of the Notice of Proposed Rulemaking within 60 days of publication in the Federal Register. is isn't the only work the mortgage and housing industry is doing to promote diversity and inclusion, though. e American Mortgage Diversity Council (AMDC), an independent membership organization focused on advancing the conversation of diversity and inclusion within the mortgage industry, has introduced a digital library featuring diversity and inclusion articles with leading news assembled by various government and media organizations. e library will be a resource for the industry to find articles in the following categories: regulatory, advisory, statistical impacts of diversity, workforce development, supply chain management, and lender impacts. AMDC is also accepting applications for the 2016-2017 Mortgage Industry Diversity and Inclusion Directory. e Diversity and Inclusion Directory is a collection of company profiles that are minority and women owned or operated. e directory will be available online and will have limited print distribution to servicers, government agencies, and suppliers that are looking to engage diverse companies in supply chain. ANALYSIS PROVIDES LOOK AT POSSIBLE GSE RESTRUCTURING OPTIONS Several years after the Great Recession, taxpayers remain on the hook for Fannie Mae and Freddie Mac, and the federal government is still trying to determine a way to make the GSEs self-sustaining—without increasing the risk for another bailout. at's the gist of a policy analysis out in October from the Congressional Budget Office, an independent nonpartisan agency tasked with reviewing the impacts of congressional legislation. e CBO went with an illustrative outlook that focused less on any wish to restructure the housing market and more on what it would look like to shore up Fannie and Freddie. So, what did the options look like? Under one policy, the federal government could allow the GSEs to keep to $50 billion of its profits over the next decade. If needed, the government could step in to buy more senior preferred stock from Fannie and Freddie to ensure the two companies maintain a positive net worth, the CBO said. ey could also raise their income with returns secured by investing these profits in Treasury securities, according to the report. All of this would increase the federal government's explicit backstop relative to the GSEs' retained earnings, reduce the likelihood that Treasury would need to buy additional shares of preferred stock in the future, and result in a budgetary cost of about $10 billion. Under an administration treatment, the CBO said these policy options went as high as $85 billion over 10 years. Members of Congress have floated a number of legislative bills intended to restructure the GSEs and their role in the U.S. housing market, but as yet Fannie and Freddie remain in federal conservatorship. The foreclosure rate (0.9 percent) is back to 2007 levels, according to CoreLogic. KNOW THIS

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