Under this bill, Fannie Mae and Freddie Mac would be required to contribute to the fund revenue equal to 1.2 basis points for each dollar of their average total mortgage portfolios for the preceding year. In the first year, the money would go to Gulf Coast states, which are still struggling with housing problems after the 2005 hurricanes.

Crowley noted that the fund is not an entirely new concept. It "is the conceptual cousin of the highly successful Affordable Housing Program of the Federal Home Loan Banks, through which 10% of their profits must go into a grant program to support affordable housing activities," she told the committee.

She also noted that this bill makes clear what can and cannot be done with these funds. An earlier version of the bill introduced in the last Congress generated some controversy when questions arose whether the funds could be used for other activities than building capital costs.