Transportation, Housing and Urban Development, and Related Agencies Appropriations Act, 2008

Floor Speech

TRANSPORTATION, HOUSING AND URBAN DEVELOPMENT, AND RELATED AGENCIES APPROPRIATIONS ACT, 2008 -- (House of Representatives - July 24, 2007)

BREAK IN TRANSCRIPT

Mr. TURNER. Mr. Chairman, my amendment, coauthored by Representative Biggert of Illinois and Mr. Gillmor of Ohio, seeks to help families who are potential victims of lending practices that could lead to foreclosure. The amendment increases the amount of funds available for housing counseling under section 106 of the Housing and Urban Development Act of 1968.

The amendment would increase the program's funding by $6.7 million. The increase is offset by reducing the Office of Inspector General account by $6.7 million. The CBO has scored this amendment as budget-neutral.

Funding for housing counseling has increased by only $2 million since fiscal year 2003.

Mr. Chairman, as a former mayor of the city of Dayton, Ohio, I have seen directly the detrimental impact that predatory lending and the practice of unwarranted subprime loans have had on urban families and communities. In 2001, the University of Dayton released a study of how mortgage foreclosures were affecting urban areas in Ohio. My community of Dayton had 1 foreclosure for every 43 households. Similar findings were seen in Cleveland, Akron, Columbus, and Cincinnati.

The problem of home foreclosures isn't limited to Ohio and the Midwest. According to a June 12, 2007, Bloomberg article, national home foreclosure rates in May soared 90 percent from last year. Many of these are tied to the subprime loan industry.

Many foreclosed homes sit vacant and boarded up for long periods of time. These properties go beyond just being an eyesore and become a threat to public health and safety. These properties are a blight to our neighborhoods and result in falling property values and increased crime, lead to an eroded tax base, and impair a city's ability to provide important services to families.

Beyond the individual impact these practices have on our neighborhoods, the subprime foreclosure crisis is resulting in the loss of capital in the financial market, a market that, if not righted, could threaten our growing robust economy.

Today we are seeing headlines from all across the country showing the growing concerns of financial markets regarding predatory and subprime lending practices that have resulted in a record number of foreclosures.

Recently, members of the Ohio delegation, led by Representatives GILLMOR, PRYCE, LATOURETTE, and Senator Brown, held a forum on the predatory lending crisis in Ohio. At this forum we heard from a variety of groups, from banks to fair housing groups. All of these groups shared a mutual concern over the issue of predatory and subprime lending, and many agreed that an increased focus on housing counseling was a key component to fighting this problem.

It is my hope that increased funding possible through this amendment will allow housing counseling agencies the ability to provide vital counseling services to families in need. These services will give families the assistance they need to protect themselves from practices and circumstances that could lead to foreclosure.

Mr. Chairman, I believe that homeownership is a privilege that everyone should enjoy. We must give all American families the tools they need to be successful homeowners.

Mr. Chairman, I yield back the balance of my time.

Mr. OLVER. Mr. Chairman, I move to strike the last word.

The Acting CHAIRMAN. The gentleman from Massachusetts is recognized for 5 minutes.

Mr. OLVER. Mr. Chairman, I would ask the gentleman if he would withdraw his amendment, and I would be happy to work with him, as I am sure the ranking member would as well, though I would lead him to comment, to work with him in conference to address this issue.

Otherwise, I rise in reluctant opposition to the gentleman's amendment.

I believe the need, as he has indicated, for housing counseling is strong. But what his offset does in this instance is to take the funding for the Inspector General for HUD back to the level of the budget request for the year 2007, where we had increased in the supplemental budget the appropriation for the IG to $88.2 million, in the supplemental budget had been added to the IG to do its work, and have recommended in this bill a less than 2 percent increase. So that, compared with the 2007 appropriation for the IG, the amendment would represent a 5 or 6 percent decrease in the amount of funding available for the IG.

We simply are not in a position to be able to increase this account because of the deep holes that the President handed to us in the HUD budget. We froze the account at the FY07 level, with the supplemental amount there, which is the best that we could do without harming other HUD programs.

Now, taking the funding from the Inspector General to increase this account is counterproductive to the gentleman's amendment. Should we reduce the oversight in order to increase the housing counseling? They're both vital programs. We feel that we have struck the correct balance here for this pair of needs.

I commend the gentleman's passion on the issue, and I would be happy to work with him in the future on the issue related to housing counseling. And I do recognize that we are likely to have some, in the secondary lending market, problems later this year, continuing problems, as we have been having, but I would urge the gentleman to withdraw the amendment at this time and we would try to work it out in conference.

Mr. TURNER. Will the gentleman yield?

Mr. OLVER. I would be happy to yield.

Mr. TURNER. Mr. Chairman, I appreciate your commitment to look to work on this issue; however, the housing crisis is enormous. It is impacting a number of families and neighborhoods throughout the country. We're seeing the impacts are grave.

I would like to work with you on where, perhaps, an offset would be acceptable. But at this time we would like the House to be on record in support of this increased funding, so I would desire not to withdraw the amendment. But I appreciate your support of the increased funding and will look forward to working with you.

BREAK IN TRANSCRIPT

Mr. TURNER. I certainly appreciate your description of the needs for the Inspector General. And I support, of course, the chairman's description of searching for additional offsets for this in order to find additional monies for housing counseling. And in that, I'm certain that after the amendment passes the House, that there would be a great deal of effort by the chairman in conference to seek, perhaps, an additional offset where the Inspector General amount could be restored.

But as you have heard from so many of the Members that are here, this is an issue that strikes at the very heart of the fabric of our neighborhoods and our families. I have so many families who have come to me to tell me the stories of what they have experienced. There are nonprofit organizations in my community who are every day working with families who have faced this issue of foreclosure, and they want to know that we support the services that are being provided to them and that might be available to them.

BREAK IN TRANSCRIPT

Source